One type of loan, more than any other, has a profound effect on the American economy these days. These loans can cause undue hardship for borrowers, and can lead to a lifetime of inescapable debt. But instead of cautioning people against these loans, authorities promote them, despite their negative aspects.
No, we’re not talking about payday loans. Those are small dollar short-term loans, catering to working class people with steady jobs but poor credit.
Today we are talking about student loans.
While payday loans draw more and more attention from federal regulators, and face a barrage of negative media attention, it is the student loan system that shackles young people to tens of thousands of dollars worth of debt that they will carry with them for decades, if not longer. (more…)