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Students: Here's a rock. Here's you. Here's a hard place.

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Well, colour me conflicted. It’s Crayola’s newest shade, I hear. I was just reading in my local news rag that StudentAid BC stripped a bunch of schools of their official designation, leaving students unable to get student loans to attend them. It’s little private schools, primarily, like Sprott Shaw Community College (though not all of their branches were affected). They did this because the default rate of their students was so very high.

“At the end of the day it’s the student’s decision whether or not to pay their student loan,” Predyk (VP of Operations for Sprott Shaw) said. “You’re penalizing other prospective students for the actions of students who may have come to school four years ago.”

Actually, no. At the end of the day, they’re telling students not to go to your crappy crappy school because no one will give them a job afterward, and they’ll default on their student loans. But nice of you to obfuscate the issue. On the other hand, what’s a person to do if they’ve not go the credentials, brains or ambition for a better school, but desperately need to get some better skills? If you can’t get into or through a UVic or Camosun program, but want to do something other than unskilled labour, what kinds of options do you have?

And yet, I understand that if the job market isn’t hiring those people anyway, then…

UVic’s default rate is quite low, which is great, but there’s a few issues here, and I think there’s more to it than the programs being better. I mean, people who attend UVic tend to start out in a higher economic class than those trying to go to Sprott Shaw. They’re often younger and have parents that can pay if they get in trouble. They’re more likely to get jobs in the white collar fields, regardless of their programs. They usually don’t go into school with other debt. Furthermore, they tend to marry people who are also from the same class background - and marriage partners are on the hook for their spouses’ loans. So how much of it is the prestige of the program? And how much of it is the economic situation of the student likely to attend the school in the first place?

Student loans themselves are kick in the ‘nads. There are a number of injustices built right into the system:

  • To qualify, your partner’s or parents’ income is taken into account. This is ridiculous if neither of them will pay your tuition.
  • When paying them back, if you can’t afford to pay them back, your partner is on the hook for them. However, your partner cannot claim the tax credit for the interest paid. Even if s/he is the one paying all of your loan payments. This is doubly stupid because in order to qualify for interest relief or debt reduction, your partner’s income is considered to be yours.
  • Loan payments are charged higher amounts of interest than the average mortgage. Usually by about 5%. Why are banks allowed to charge interest on these at all? They’re guaranteed by the government, so there’s no risk at all to the bank! It’s infuriating that multi-billion dollar corporations are allowed to make millions off the backs of struggling students. Also, it’s a HUGE benefit for those who do end up getting good jobs, because they can roll their student loans into their mortgages. I did. It’ll save me thousands and thousands of dollars in interest. If my economic situation wasn’t so good? If my husband didn’t have a decent union job? We’d be on the hook to the bank for a lot more money.
  • For some reason, declaring bankruptcy doesn’t clear student loans. Why are these loans different from every other debt?
  • If a married couple with kids both have student loans, the mother gets the money to pay for the kids. This means a higher debtload for women, who are statistically more likely to be poor and underpaid.

This is so infuriating. My husband paid off thousands of dollars of interest on my loans, but cannot claim the tax credit. Although we went to school for the same amount of time and were married for all but one year of it, I have a much much larger debt load than he does, because I was the one who had to claim the dependent (I’m the Mom!).

This is sexism at its finest. I had a larger debtload than he does, because I’m the mother. But I have a lower paying job than he does, because I’m the woman. He is expected to pay my loans off, because “we’re equal partners” (snort We weren’t when they determined the loan payments). But only I can claim my interest payments. And I can’t claim them because I don’t even make more money than my basic personal amount.

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This page contains a single entry by published on August 24, 2011 3:58 PM.

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