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#61 of 68 Old 05-12-2008, 07:14 PM
 
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Originally Posted by mama41 View Post
In most fields (and ed isn't one of them), if you have high student loans, it's because the school didn't really want you that bad. That's a good indicator of how you'll do in the marketplace.
I guess then that my son who graduated from a good university with high student loans wasn't wanted that bad by his school or by the marketplace. He, he , he, I can't help but laugh. He worked at that university doing IT jobs while getting his education and was highly paid. He now works for a major airline making six figures so I guess it wasn't that good of an indicator how he would do in the marketplace. He has done very well as have my other children who also had student loans. My other two are in education by the way, one works with disadvantaged children and the other teaches ESOL overseas in a highly competitive foreign market. I had high student loans for my graduate degree but also earned the highest scholarships for academic excellence that the school offered. (for every semester, and it was highly competitive) They only covered half of the tuition at this private school. Gee whiz, I guess I wasn't really wanted... I have paid off my loans by the way and very quickly. I have done fine in the market place. So will others who get loans, or who pay cash, or who get grants and scholarships. If a person cares about their higher education, they will do well and succeed.
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#62 of 68 Old 05-12-2008, 09:16 PM
 
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I think mama41 may be generalizing what holds true for a fairly small segment of the population -- future academics/college professors. 100% of the people I know who've gone down that path have had their masters/phd paid for by the programs that they are in. Quite frankly from their experience, if you're not good enough to get your Ph.d in (for example) History paid for by the school, you're not good enough to get a tenure track position, and shouldn't be following that career path. Or else accept a life of adjunct hell...
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#63 of 68 Old 05-12-2008, 11:31 PM
 
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Wow, never thought I'd be judged by my student loans! I think it also depends on the money available at the schools. I had pretty much a full ride at a private college, but my public university grad school just didn't have that much money available. Everyone had loans and lots of them. Had I gone to private grad school (but would have had to move my family out of the area) I'd have less loans. Some people seek out grants from different sources, others just accept the first finacial aid offer. Some people worked part time through the grad program. I had a husband and kid so I took out additional cost-of-living loans instead of working in addition to the full time grad program. I really don't think it is much of an indication of anything.
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#64 of 68 Old 05-12-2008, 11:40 PM
 
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I understand that you have to make decisions that protect your bottom line, but the generalization is rather broad sweeping.
Yes, of course. In no sense is it personal. It's all you can do when making business decisions with people you don't know and your risk tolerance is low. Naturally it will be unfair to some. But you'll find that banks behave similarly whenever they're in a squeeze.
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#65 of 68 Old 05-13-2008, 12:33 AM
 
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I guess then that my son who graduated from a good university with high student loans wasn't wanted that bad by his school or by the marketplace. He, he , he, I can't help but laugh.
OK. I'm glad you and your children have done well. In 20-some-odd years of living in and around universities, though, public and private, what I see is that in general, students regarded as promising get considerable help, and walk out with loans of $0-moderate amount. Undergrad and grad. Might an excellent student get no help? Sure. I've seen that happen too. But if you look at the two groups, which is about all I can do as a landlord, the funded group is considerably more successful and employable. Of course, that's for just out of school. If a prospective tenant had long employment at a good wage...well, I'd ask why she was renting instead of buying. But if I got a reasonable answer, then sure, that'd mitigate a lot of student debt on the report.

Flor, yes, unfortunately, you do get judged by your student loans. I say "unfortunately" because banks cooked up this idea of "good debt" maybe 15 years ago, and it's been a crackerjack success. Only it's bunk. Debt is debt. Every creditor out there is looking at student loans as part of total indebtedness -- in the end, the student-loan creditors are in line ahead of them if your situation goes belly-up. The credit landscape has changed, that's all.
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#66 of 68 Old 05-13-2008, 09:55 AM
 
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Originally Posted by mama41 View Post
Yes, of course. In no sense is it personal. It's all you can do when making business decisions with people you don't know and your risk tolerance is low. Naturally it will be unfair to some. But you'll find that banks behave similarly whenever they're in a squeeze.
And I should say that I just got a Home Loan, on my little teaching salary, with my high student loan, for $130,000 at just 5.5%. I would think a full credit report with payment history would be a much better indicator than loan amount. I had been a home owner since I was a junior in college (over 10 years ago) working 30 hours a week at minimum wage. When I divorced my husband bought me out and I have been renting since January. I take possession of my new house tomorrow and will be out of my rental at the end of the month.
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#67 of 68 Old 05-13-2008, 11:28 AM
 
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Originally Posted by mommyto3girls View Post
And I should say that I just got a Home Loan, on my little teaching salary, with my high student loan, for $130,000 at just 5.5%. I would think a full credit report with payment history would be a much better indicator than loan amount. I had been a home owner since I was a junior in college (over 10 years ago) working 30 hours a week at minimum wage. When I divorced my husband bought me out and I have been renting since January. I take possession of my new house tomorrow and will be out of my rental at the end of the month.
This is true. Credit-worthiness amounts to more than just total debt - debt to income ratio, debt to payment ratio, payment history, etc. I've never missed a payment on my student loans and that factored heavily into my home loan. When I applied for my home loan, my credit score was in the low-mid 700's without ever opening a single consumer account. It was based on utilities history and student loans alone. It certainly wasn't my income that qualified me. I was working for a non-profit doing habitat restoration and conservation at the time. Neither was it so long ago - just 3 years.
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#68 of 68 Old 05-13-2008, 03:34 PM
 
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Originally Posted by mommyto3girls View Post
And I should say that I just got a Home Loan, on my little teaching salary, with my high student loan, for $130,000 at just 5.5%. I would think a full credit report with payment history would be a much better indicator than loan amount. I had been a home owner since I was a junior in college (over 10 years ago) working 30 hours a week at minimum wage. When I divorced my husband bought me out and I have been renting since January. I take possession of my new house tomorrow and will be out of my rental at the end of the month.
Of course. Nobody, including me, looks at these things in isolation. (I don't like one tenant's c/c picture, for instance, but other factors more than make up for it.) Your record of homeownership probably stood you in good stead, and likely your long, stable employment did, too. And you're going to find differing levels of risk tolerance with various lenders.

What I am trying to caution against is the notion that lenders ignore student loans because they're "good debt". It simply isn't true. So this is one reason -- certainly not the most important reason, but one reason -- why you don't want your 22-year-old walking out of school loaded up with school debt, and why it's a good idea to help them pay for school. 20 years ago, credit reports didn't govern opportunities the way they do now.

Congrats on your new house, by the way.
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