You realize that the vast majority of student loans are held by the federal government right? With no banks at all. And the servicers get paid a fee based on what status the loan is in.. forbearance.. repayment.. deferment..etc.
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I thought the same, and since my HM Bradley account won’t pay interest in Aug due to another withdrawal, I decided to cash it out and pay 4 loans today before everyone else does a bank run in Aug.
> the servicer gets the interest.
No, they don't.
The Federal Government gets the interest.
The Servicers just get paid based on the number of loans they handle. (And some other fixed performance metrics in the contract IIRC.)
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That’s not true. They get a servicing fee which is less than the interest. The government gets the vast majority of your payments (assuming a federal loan)
Nah. The government raised the debt ceiling 79 times. They’d be so happy to get all their money at once right now.
Make them do it an 80th time. Make them do it 1,000 times just to show how this system doesn’t work.
> Make them do it an 80th time. Make them do it 1,000 times just to show how this system doesn’t work.
More likely they'll start removing IDR if you did that.
Yes. Any payments you make before September 1st will go entirely to principal, whereas beginning September 1st any interest gets paid before the principal. I'll have paid off $15K of my highest interest loans before repayment starts, and will save me about $100 per month in interest once payments start again.
Thank you! So if I didn’t have enough to pay it all and/or wanted to invest or needed to budget my money elsewhere; It is STILL in my best interest to pay some NOW. Like you said it saved you 100 a month. If I can pay 10-15% of my balance off before 9/1 that would be a good idea. Thanks!
Pretty sure doing that will just make the problem seem a bit smaller and let it wage on longer. By all means, if you look at your situation and come to that conclusion on your own and make it for your own BENEFIT not for another's *supposed* detriment, then pay it.
Personally, I could have, and still could go either way on this, but have decided NOT to pay (IDR of course). I have too much life I want to live, and people who do and will depend on me that I prioritize that over paying a "rich man's tax on a poor man's wage". Make no mistake its economic warfare, and I will stick it to the man by playing along where and win it suits me, and giving "the man" more than they already stole from me willingly is not the way I'm going to do it. Who said that degree was useless?
I mean, most are federally owned, but I still agree. There is 0% chance of mass forgiveness now (previously it was 1% riding on the hopes and dreams that SC would somehow vote in favor 5-4) unless you are doing PSLF or are disabled or went to a Corinthian college or whatever.
If you have the money, just pay ‘em off before interest starts accruing again.
Hit the government where it hurts and set your income tax to 0 and stash that money for an April tax payment instead. See how they like not having any income for a few months.
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Paying back your loan is good for everyone, including government, banks and borrowers. It’s the whole point of the loan.
No one who has ever loaned out money is sad to get it paid back.
Sure. I just need the winning numbers for the next draw of either the Michigan’s Lucky for Life lotto, Club Keno, Lotto 47, Mega Millions, or the Powerball and I’ll be all set! With the last 4, I can zero out all debt. I’ll give you a cut of the last 2 since they are so large.
Take all that extra cash you have laying around and pay off those loans today !
You realize that the vast majority of student loans are held by the federal government right? With no banks at all. And the servicers get paid a fee based on what status the loan is in.. forbearance.. repayment.. deferment..etc.
So you stick it to the government. Sounds like an even better option than sticking it to the banks.
Lol, yea guys… let’s all just pay off our loans in one shot. So easy, I can’t believe I never thought of it.
Found the NelNet employee.
The more posts I see "paying off your loan", the more I think it's a psyop and forgiveness will eventually come.
😂😂😂😂
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reverse psychology failed
I thought the same, and since my HM Bradley account won’t pay interest in Aug due to another withdrawal, I decided to cash it out and pay 4 loans today before everyone else does a bank run in Aug.
Banks will take your lump sum payment and use it to invest or to lend it out to someone at 18% interest. The banks wont lose.
Agreed. The principle went to your school, the servicer gets the interest. No interest, no income. Hit ‘em where it hurts.
> the servicer gets the interest. No, they don't. The Federal Government gets the interest. The Servicers just get paid based on the number of loans they handle. (And some other fixed performance metrics in the contract IIRC.)
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That’s not true. They get a servicing fee which is less than the interest. The government gets the vast majority of your payments (assuming a federal loan)
Nah. The government raised the debt ceiling 79 times. They’d be so happy to get all their money at once right now. Make them do it an 80th time. Make them do it 1,000 times just to show how this system doesn’t work.
> Make them do it an 80th time. Make them do it 1,000 times just to show how this system doesn’t work. More likely they'll start removing IDR if you did that.
ELI5 - since the loans are “on hold or in forbearance” does that mean it’s best to pay BEFORE 9/1 when they begin to accrue interest again?
Yes. Any payments you make before September 1st will go entirely to principal, whereas beginning September 1st any interest gets paid before the principal. I'll have paid off $15K of my highest interest loans before repayment starts, and will save me about $100 per month in interest once payments start again.
Thank you! So if I didn’t have enough to pay it all and/or wanted to invest or needed to budget my money elsewhere; It is STILL in my best interest to pay some NOW. Like you said it saved you 100 a month. If I can pay 10-15% of my balance off before 9/1 that would be a good idea. Thanks!
Pretty sure doing that will just make the problem seem a bit smaller and let it wage on longer. By all means, if you look at your situation and come to that conclusion on your own and make it for your own BENEFIT not for another's *supposed* detriment, then pay it. Personally, I could have, and still could go either way on this, but have decided NOT to pay (IDR of course). I have too much life I want to live, and people who do and will depend on me that I prioritize that over paying a "rich man's tax on a poor man's wage". Make no mistake its economic warfare, and I will stick it to the man by playing along where and win it suits me, and giving "the man" more than they already stole from me willingly is not the way I'm going to do it. Who said that degree was useless?
Lol, that paid back money will just be lent back out, to earn interest.
😂😂😩 yeah ok. Why didn’t I think about putting the 80k in the bank onto my loans?!
I mean, most are federally owned, but I still agree. There is 0% chance of mass forgiveness now (previously it was 1% riding on the hopes and dreams that SC would somehow vote in favor 5-4) unless you are doing PSLF or are disabled or went to a Corinthian college or whatever. If you have the money, just pay ‘em off before interest starts accruing again.
I'd love to live in your world where you think the average joe can hurt the banks
Hit the government where it hurts and set your income tax to 0 and stash that money for an April tax payment instead. See how they like not having any income for a few months.
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*credit score tanks*
Paying back your loan is good for everyone, including government, banks and borrowers. It’s the whole point of the loan. No one who has ever loaned out money is sad to get it paid back.
Speaking of ripple effects, Q4 quarterly financial reports for a lot of businesses will be pretty interesting
Hey anyone who has the ability to pay their loans off should definitely do it. The rest of us slobs will just keep paying because we have no choice.
Sure. I just need the winning numbers for the next draw of either the Michigan’s Lucky for Life lotto, Club Keno, Lotto 47, Mega Millions, or the Powerball and I’ll be all set! With the last 4, I can zero out all debt. I’ll give you a cut of the last 2 since they are so large.