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Student loan repayment
Posted on 6/15/22 at 8:01 am
Posted on 6/15/22 at 8:01 am
Anyone think once the pause of Federal student loans go back into repayment status there will be another drag on consumer spending impacting the market.
7
Posted on 6/15/22 at 8:08 am to iron banks
Yes
Posted on 6/15/22 at 8:08 am to iron banks
quote:
Anyone think once the pause of Federal student loans go back into repayment status there will be another drag on consumer spending impacting the market.
Repayment? Hahahah you think Biden is crushed now? Wait until the final nail in the coffin happens.
Posted on 6/15/22 at 8:11 am to iron banks
Absolutely to some degree. When poeple arent having to make $300, $500, $1000 student loan payments every month most are just shuffling that money to be spent elsewhere. Part of the reason they keep kicking it down the road IMO especially now that the economy has been on a downturn this year. I mean the Dems are doing it to try and get something together for forgiveness, but now there's definite other motives.
It worries me this has been punted down the way for over 2 years now because so many people have adjusted to not paying it and that money is earmarked elsewhere. Too many people live paycheck to paycheck so once those kick back in it could be a huge kick into the economy's nuts once again.
Imagine if mortgages got frozen for over 2 years and nobody had to pay. I mean beyond the gigantic inflation that would hit the entire economy as a result of that money flowing into it all of sudden but we think the housing market boomed in the last year+, imagine what it would look like if people got told they didnt have to pay their mortgage and the govt kept kicking that down road every 6 months when it came to a "Deadline" to kick back in
Not even getting into the inflation this also helped cause over this time period. Just another one of the many factors in the inflation we've been seeing. Want to see inflation slow a bit? Let student loan payments kick back in. Would be way more effective than these slow interest rate increases by the fed, granted it could crash the market even harder than huge interest rate hikes would.
It worries me this has been punted down the way for over 2 years now because so many people have adjusted to not paying it and that money is earmarked elsewhere. Too many people live paycheck to paycheck so once those kick back in it could be a huge kick into the economy's nuts once again.
Imagine if mortgages got frozen for over 2 years and nobody had to pay. I mean beyond the gigantic inflation that would hit the entire economy as a result of that money flowing into it all of sudden but we think the housing market boomed in the last year+, imagine what it would look like if people got told they didnt have to pay their mortgage and the govt kept kicking that down road every 6 months when it came to a "Deadline" to kick back in
Not even getting into the inflation this also helped cause over this time period. Just another one of the many factors in the inflation we've been seeing. Want to see inflation slow a bit? Let student loan payments kick back in. Would be way more effective than these slow interest rate increases by the fed, granted it could crash the market even harder than huge interest rate hikes would.
This post was edited on 6/15/22 at 8:14 am
Posted on 6/15/22 at 8:30 am to iron banks
Payments resume on August 31st, right?
I wonder if they'll push it back another 3 months for mid-terms...
I wonder if they'll push it back another 3 months for mid-terms...
Posted on 6/15/22 at 8:36 am to SonicAndBareKnuckles
Yes, Sept 1 it is set to resume unless they push it back. I don't have any loans as I paid mine off years ago. Just thinking it could be another significant anchor around the economy.
Posted on 6/15/22 at 8:51 am to SonicAndBareKnuckles
quote:
Payments resume on August 31st, right?
I wonder if they'll push it back another 3 months for mid-terms...
I would bet major money on if they haven't gotten any forgiveness together at that point its being punted to 2023.
No way the Dems fall on that sword right before mid-terms if they havent passed some sort of mass forgiveness at that point. You think it would turn congress around already as it is? Let them reinstate their first few new student loan payments literally right before people go vote...with no forgiveness given or in sight still and see how much of a bloodbath that election would be
Posted on 6/15/22 at 8:57 am to SonicAndBareKnuckles
quote:
I wonder if they'll push it back another 3 months for mid-terms...
They will keep postponing it. Political football at this point
Posted on 6/15/22 at 9:14 am to thunderbird1100
quote:
Imagine if mortgages got frozen for over 2 years and nobody had to pay. I mean beyond the gigantic inflation that would hit the entire economy as a result of that money flowing into it all of sudden but we think the housing market boomed in the last year+, imagine what it would look like if people got told they didnt have to pay their mortgage and the govt kept kicking that down road every 6 months when it came to a "Deadline" to kick back in
I mean they already did this with rent for like 18 months.
But yea, you're spot on. It's a nightmare.
Posted on 6/15/22 at 9:25 am to Ancient Astronaut
quote:
They will keep postponing it. Political football at this point
Agree or disagree, it would be a pretty big frick you to a bunch of people facing skyrocketing inflation, fuel prices, and a scary job market to then say “oh start paying your student loans back too.”
Posted on 6/15/22 at 9:46 am to iron banks
I think it either gets pushed back again to be after midterms or they resume it in September but the 10k in forgiveness happens to lessen the sting. Dems can run on forgiving the rest as long as you vote D in the midterms (lol)
Posted on 6/15/22 at 9:50 am to iron banks
Looking at the financial impact (and leaving the political one to the Poli Talk board)... the whole point of the pause was to push money into other parts of the economy.
So yeah... when/if payments resume... it will have a drag effect.
I don't think it will be huge. Many with large balances / large income have kept paying to reduce interest, and those with large balances / small income will just IBR it so it's not a huge amount moving around.
So yeah... when/if payments resume... it will have a drag effect.
I don't think it will be huge. Many with large balances / large income have kept paying to reduce interest, and those with large balances / small income will just IBR it so it's not a huge amount moving around.
Posted on 6/15/22 at 10:36 am to iron banks
quote:
Anyone think once the pause of Federal student loans go back into repayment status there will be another drag on consumer spending impacting the market.
Hope so, it will definitely help inflation.
The real question though, is will they ever get un-paused?
Posted on 6/15/22 at 11:51 am to SonicAndBareKnuckles
This and he will also announce $10,000 to $50,000 in freebies to everybody with a student loan.
Posted on 6/16/22 at 5:32 am to iron banks
It will start removing cash out of the economy. Too much cash in the economy is a big reason we have inflation.
Posted on 6/16/22 at 6:26 am to SonicAndBareKnuckles
quote:
I wonder if they'll push it back another 3 months for mid-terms...
They will keep using new excuses to keep it on hold (e.g. inflation, war, home prices, etc.)
Posted on 6/16/22 at 7:13 am to STLhog
quote:
I mean they already did this with rent for like 18 months.
But the vast majority of renters still kept paying their rent. That was much less a "almost everyone stopped" situation. Hardly anyone has been making student loan payments still since the freeze.
Posted on 6/16/22 at 7:33 am to JohnnyKilroy
quote:
I think it either gets pushed back again to be after midterms or they resume it in September but the 10k in forgiveness happens to lessen the sting. Dems can run on forgiving the rest as long as you vote D in the midterms (lol)
I don't think $10k in forgiveness is enough to outweigh the sting of restarting payments, no matter what they try to run on afterwards. Democrats have taken what could have been an easy political win and are potentially turning it into a massive political albatross.
Posted on 6/16/22 at 8:34 am to Joshjrn
quote:
I don't think $10k in forgiveness is enough to outweigh the sting of restarting payments, no matter what they try to run on afterwards. Democrats have taken what could have been an easy political win and are potentially turning it into a massive political albatross.
The way they spin it is in order to give $10k of forgiveness we have to re-start payments (Cash flow concerns, etc).....buuttttt, if you vote for us in November we want to pass the $50k forgiveness if we can.
Posted on 6/16/22 at 8:34 am to Joshjrn
quote:
I don't think $10k in forgiveness is enough to outweigh the sting of restarting payments, no matter what they try to run on afterwards. Democrats have taken what could have been an easy political win and are potentially turning it into a massive political albatross.
The way they spin it is in order to give $10k of forgiveness we have to re-start payments (Cash flow concerns, etc).....buuttttt, if you vote for us in November we want to pass the $50k forgiveness if we can.
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