> Rant: I feel like most people haven't really thought about why colleges are so expensive now. It is because of the federally guaranteed student loans.
I've heard this thousands and thousands of times. I suspect that most people have heard it already too.
> It means there's pretty much no downside to banks loaning an arbitrarily large amount, because if the student doesn't pay it back, the government will.
This is a misunderstanding of the current student loan system, which is mostly direct loans from the federal government rather than private bank loans. That's why student loan forgiveness by the federal government is a current issue.
I've heard this thousands and thousands of times. I suspect that most people have heard it already too.
> It means there's pretty much no downside to banks loaning an arbitrarily large amount, because if the student doesn't pay it back, the government will.
This is a misunderstanding of the current student loan system, which is mostly direct loans from the federal government rather than private bank loans. That's why student loan forgiveness by the federal government is a current issue.