The largest bank in the United States will stop making student loans in a few weeks.
JPMorgan Chase has sent a memorandum to colleges notifying them that the bank will stop making new student loans in October, according to Reuters.
The official reason is quite bland.
"We just don't see this as a market that we can significantly grow," Thasunda Duckett tells Reuters. Duckett is the chief executive for auto and student loans at Chase, which means she's basically delivering the news that a large part of her business is getting closed down. ...
...JPMorgan's actually the second big private lender to step away from the business. Last year US Bancorp exited the business. That leaves Wells Fargo & Co., Discover Financial Services Inc., PNC Financial Services Group, SunTrust Banks Inc., and various credit unions as the largest private student lenders. Oh, and of course, Sallie Mae, which was privatized in 2004.
This article was taken completely out of context. The article rests on that one sentence "We just don't see this as a market that we can significantly grow." How did they turn this into bubble bursting? The loans JPM are lending are private loans, which are being crowded out because government got into that game too. Thus JPM's private student loan business can no longer make significant growth because of this giant competitor. Notice that JPM isn't saying that it is not profiting....it is saying that this segment is not growing as fast as they would like. When it comes to money allocation, you always allocate it to projects that make more money. If one project makes 10% another makes 13%, you go with 13%. Somehow this article extrapolated this to mean that the student loan bubble is bursting.
This all just baffles me in the sense that there are jobs maybe menial but a ton of jobs nonetheless and there are still people who feel they can just default? My generation namely. If only these people knew the damage at such a young age they are doing to their credit and essentially lives. As for the rest of us who pay our bills and work our butts off to do so, no need to worry about a thing.
That anyone could say this in a country where, currently and for the past few years, people with college degrees can't even get called back for hourly jobs at Taco Bell and McDonald's, and people with Master's degrees are working mall retail, blows my mind.
I'm a pre-nursing student & I already owe $40000 in loans. Once I'm done with nursing school I'll owe about $60,000. I'm not too worried about it, because I'll be making decent money[/quote']
Most people aren't worried about it until they actually have to start paying for it
Over 10 years that's around $700 worth of repayment a month. Even making "decent" money, that's a lot.
But what are you going to do? Nowadays debt is almost necessary to get through school.
Nice to see you..... it a large forum sonetime it is difficult to cross paths....LOL
It applies because not all people who have loans of any kind default because they are lazy and refuse to get a job. There are circumstances that are beyond our control that no matter how hard we try...it just isn't enough.
You may have agreed to a credit check and NEVER know it. If you have applied for a job and they performed a background check....AND your state allows it......they can perform a credit check as a part of that background check. MANY retailers perform background checks for those employees who handle money....ie: Cashiers.
As a nurse, applying for a job, you WILL be subjected to credit checks in the states that allow them and some of those states do NOT have to notify you. Did you know they perform a credit check to sign up for a mobile phone? You have probably had your credit checked without your permission. depends on the state
That you will NEVER consent to a credit check and will ALWAYS be able to find a job and work enough that default is not an option........Never is a long time and always has an exception.
It shows to your good character that your efforts, hard work ethics and perseverance that you were able to keep your head above water. Right now there are hard hit areas of the country where this is near impossible.
California has a 47% unemployment rate of new grad nurses. MANY of the previously laid off and underemployed went to nursing school on the promise of a nursing shortage (that doesn't exist) and paid exorbitant tuition for a key to the door that opened to the yellow brick road...who can't find enough work to pay the new loan bill and can't negotiate for longer/better terms/forgiveness who have no choice but to default.
As nurses it is our job to have empathy and understand of another's circumstances and decisions, whether or not they are correct decisions, and sit in judgement. We can have our own personal opinion but it is our job to look at all possibilities and see all side of one story.
Can I just reiterate that not all loan default is due to laziness. I defaulted in 2001, due to a 3 month stint in the hospital, so doped out of my mind (necrotising pancreatitis REALLY hurts) that I never thought for a second to call my loan servicer. Low and behold, a big nasty full default of my loan. Sallie Mae's response? You should have called. I'm not joking. I was dying, and they felt I should have called. Luckily, I rehabbed my loans (an option easily available to all borrows post default).
My defaulted loan actually haunted me on my credit until it was fully rehabbed, and, as I've never had an employer who DIDN'T check my credit. I spent the entire rehab period, and several years after as I paid down my massive hospital debt, explaining myself to employers, what had happened, and why they should hire my 570 FICO having self. I was unaware that there were employers out there in a professional setting that still do not run credit... I have never seen one.
Oh, and just to give an idea of why "just get a job" doesn't work. For a 30K loan, the average payment is usually more than your average 15 dollar an hour employee can make and still, you know, eat and pay rent. Yes, maybe they should not have taken on the debt in the first place, but often times, we believe, as a society that there will always be a job at the end of the college rainbow.
Also, my personal story of monetary ruin after illness is not unique. It's actually pretty darn common. I had insurance, heck I even had an AFLAC ICU policy as well. When I got sick I smashed right on through my lifetime cap around the 3rd week. I then spent years paying a ton of my own medical expenses because of pre-existing condition clauses (pesky pancreatic removal surgery and big old mean blue cross). If Obamacare did one thing right, I'm a shinning example of what it was.
The point is, until one has walked a mile in another's shoes, the only have an idea about the gravity if someone else's situation, not the reality (btw that's the driving force behind my nursing career change, not anything to do with a stable job, I left a stable job for this). You don't know until you know. You just DON'T. You can think you do all you want, but you can never really imagine.
This article was taken completely out of context. The article rests on that one sentence "We just don't see this as a market that we can significantly grow." How did they turn this into bubble bursting? The loans JPM are lending are private loans which are being crowded out because government got into that game too. Thus JPM's private student loan business can no longer make significant growth because of this giant competitor. Notice that JPM isn't saying that it is not profiting....it is saying that this segment is not growing as fast as they would like. When it comes to money allocation, you always allocate it to projects that make more money. If one project makes 10% another makes 13%, you go with 13%. Somehow this article extrapolated this to mean that the student loan bubble is bursting.[/quote']
This is the reason that I decided to not attend a ABSN that I entered ( I deferred till Fall 2014). I am looking to enter a local CC. If I get my ADN then get my BSN at a state university I will be less than $20K. The program I got into would have required me to take out at least $60K. I already have student loan debt that I have to worry about.I just could not enter into more debt and push my loan debt above the $100K mark. I think that is irresponsible if I have another option. I might not get a BSN as quickly however I feel I made the right choice. I do plan on getting married and having children and I could not imagine doing any of that if my credit is shot due to having debt the size of a mortgage ....and not have a home to show for it.
My dream is to be a nurse ( and get be a NNP or PNP one day). I just want to go on a fiscally conservative road in order to fulfill that dream.
It is sad that others do not think of that. Personally, I think the the student loan bursting will have a much more terrible effect of the economy that the housing bubble burst of 2008.
First of all, why would you go $30,000 in debt? That would have alleviated your Issues. Im currently going to a CC that costs $1100 for 14 credits. I understand you have to transfer university but even here its $6k a year which can be easily earned over a few years. So yes anyone can do it! You can move to North Dakota and make $15 an hour at Sears! My friend didn't even have a car and worked there while going to college.
Also you may want to read back to my post because I never once said anyone was "lazy" nor was it implied.
So your advice for anyone with mounting student loan debt is to move to North Dakota and work for Sears? Because that is just such a viable option for so many people. Do you know how much it costs to move? Take me for example. I live in Texas. It would cost me thousands of dollars to move to North Dakota. What good does that do someone who is barely scraping by to move half way across the country to work in North Dakota? They'd have to quit their job, find housing, and re-establish themselves and then, look for a new job. Given the economic state our country is in, I am dumbfounded and baffled to read these sorts of posts. I get your sentiment about being responsible with money and debt but don't be so narrow minded about it. Everyone's situation is different and being so black and white about it makes you look incredibly ignorant and naive.
Also, 30K is not an unreasonable amount of student loan debt. In fact, that's about the national average. People in our generation had it shoved down our throats that we had to go to college or else we wouldn't amount to anything. Unfortunately, student loans are a necessary evil for people who want to go to college but do not have enough money or scholarships to cover the full amount. Tutition costs continue to rise so I don't forsee this getting better any time soon.
I've already decided that if my student loans are overwhelmingly unpayable, I will just move out of the country where I can start over with a degree and new credit. If you go to college to better yourself you shouldn't be forced into unreasonable debt while the banksters and Ceos are enjoying lavish bonuses. I think it's ridiculous when people say "Well, if you couldn't afford school you shouldn't have gone and taken out loans." That is such horse spit. Why do only the wealthy get to get a college education and start off a career with a fair shake? Education is a right to everyone imo, and in many countries it's covered up to the graduate level for anyone who wants to pursue it. Sorry, but I didn't bust my butt working and going to school at the same time to be punished for trying to live a better life than the one I grew up in.
Agreed that this article is over exaggerated. One company deciding not to do student loans anymore =/= any bubble bursting. Most people go predominantly federal anyway.
That said, Carley77, get over yourself. The poster in question got a degree in ACCOUNTING. That is typically considered a pretty safe bet in anyone's eyes. It's not basket weaving. Yes, it's a 4 year degree and those do generally cost around $30k. Also I live in MN and have heard plenty about the job prospects in ND- there's a reason they pay like they do, and as there's a current major population boom those jobs will quickly dry up too. Not to mention the huge crime rates in some of the oil boom towns.
I got a degree in animal science. Admittedly, probably not the highest demand field but it was 05 when jobs were still good and I had intentions of running my own business. I did everything I could to get the almighty "experience" and still no go. I apprenticed for years before striking out on my own, and strike (out) I did.
I got a job at Applebee's and as a direct support professional at a home for the mentally disabled. I maxed out my hours at both. While I made enough money, that's ONLY because I ALSO have significant income from an inheritance. I would be really royally screwed if it weren't for that, and if it weren't for the fact that my parents paid for my first BS. Others not so much. Compared to many I came from the lap of luxury. It's pretty hard to pull yourself up by your bootstraps when you have none to begin with. Hoping that your classes will cover some poverty issues as mine did...
******If you go to college to better yourself you shouldn't be forced into unreasonable debt while the banksters and Ceos are enjoying lavish bonuses. I think it's ridiculous when people say "Well, if you couldn't afford school you shouldn't have gone and taken out loans." That is such horse spit. Why do only the wealthy get to get a college education and start off a career with a fair shake? Education is a right to everyone imo, and in many countries it's covered up to the graduate level for anyone who wants to pursue it. Sorry, but I didn't bust my butt working and going to school at the same time to be punished for trying to live a better life than the one I grew up in.****
it a large forum sonetime it is difficult to cross paths....LOL
umbdude, MSN, APRN
1,228 Posts
This article was taken completely out of context. The article rests on that one sentence "We just don't see this as a market that we can significantly grow." How did they turn this into bubble bursting? The loans JPM are lending are private loans, which are being crowded out because government got into that game too. Thus JPM's private student loan business can no longer make significant growth because of this giant competitor. Notice that JPM isn't saying that it is not profiting....it is saying that this segment is not growing as fast as they would like. When it comes to money allocation, you always allocate it to projects that make more money. If one project makes 10% another makes 13%, you go with 13%. Somehow this article extrapolated this to mean that the student loan bubble is bursting.