"Between the years 2007 and 2012, the United States government made 66 billion dollars on the interest of student loans. Think about that."
Student debt "is a travesty", says Suze Orman. Here's what she thinks the law, banks, schools, and students should do about it.
Watch the first part of our interview: http://linkd.in/1zSpZtX
Some of our favorite excerpts:
"We have $1.2 trillion of student debt. Forty million students have debt. And it's a travesty. It's a travesty what's happened. Who in the world can go out and get a loan for almost any amount of money with no ability to pay it back except students? Who has the right to get a loan with no income? Students. You can't get a car loan, can't get a home loan, can't get a business loan. You can't even get a credit card. Oh, but you can have $100,000 of student loan debt that isn't dischargeable at bankruptcy at a higher interest rate than mortgages, car loans. Really? And you can't discharge it in bankruptcy. You can't discharge it in bankruptcy, even if it's a private student loan in most cases. So what is the solution? I really think the laws have to change."
"I think student loans should absolutely be able to be discharged in bankruptcy because if you're gonna lend somebody money that they can't afford to pay back, then the lenders, you need to be more responsible about lending out that kind of money. Now, why does the government want to lend so much money to students that can't afford to pay it back? That's the question that should be asked and answered.
And the answer to that is—do you know that between the years 2007 and 2012 the United States government made $66 billion on the interest of student loans? Think about that. They can't stop. They don't wanna stop. It's a major earner for the government. The government should not be funding their deficits off of the backs of the future of America."
"If somebody doesn't do something about this, you're going to see student loans start to bring down the housing market, the economy of the United States 'cause it's just gonna mushroom and mushroom. And the result will be an economy that truly feels the effect of $2 trillion or $3 trillion of bills that cannot be paid."
"Sometimes it's worth going to school. And I have to tell you, sometimes I don't think it is worth going to school. I'm a tremendous advocate of a community college until you really know what you wanna do. I'm a tremendous advocate of vocational colleges so that you can get a job and do something and get paid for it. Am I a tremendous advocate of going to a school for $50,000 a year and graduating with $200,000 of student loan debt with an English degree? No, I'm not."
"The school will never make you. You make your school. So, it's not where you went to school that's gonna determine whether you're successful or not, it's what do you do with the education that you're getting."