While many American still suffer from the economy, the financial institutions are profiting billions of dollars and are primed to profit year after year from the loans to college students. While banks borrow money from each other at low rates close to 0%, they are charging the youths of our future exorbitant interest rates of almost 7%. This is when the 30-year mortgage for a house is about 3%.
Many of our youth come out of school with debt of over $25,000 in undergraduate loans. It is not unheard that some students come out of graduate school with loans of over $500,00.00 dollars. While, most loans can be eliminated by bankruptcy, lawmakers and investors have handcuffed our youths by preventing student loans from bankruptcies.
It is this greed of outrageous interest rates, the exorbitant profits of executives, and their investors that we place a burden on our future. It is with this baggage of debt that we send our youth into the business world. Unless, prosperity returns to the economy, many of these students will be unable to pay back even their interests on their loans. Our government and financial investors are sacrificing our youth for greed. Like the financial meltdown in the housing market, the student loan meltdown may place a great strain on our economy, and of the world.
I am not proposing that investors loan money without interest, but I am proposing an interest rate that is reasonable for both parties. Investors should gain some profit while also knowing that they are helping others. It is this foresight of the future that bankers and investors should lower the interest at a rate which is reasonable for both students and investors, leaning more in favor of the students. When this happens, the future of America will become a little brighter.