How Universities And Colleges Need To Get A Better Handle On Their Outstanding Student Loans

The number of universities and colleges in financial difficulties are on the rise.  Until now, the focus has been on student loan debts and how many students have no choice but to default on their obligations.  Promised or hoped-for jobs have vanished at astonishing speed, forcing graduates to work in positions that pay minimum wages or maybe a little above the minimum.  Most of those graduates have no benefits.  They have no health or dental insurance, no hospitalization, no life insurance and no 401K for their retirement.  However, they purchased their education from universities or colleges and those institutions rely on student loan payments to perpetuate good education.  Their object is not to engage collection lawyers to drain the students’ finances, but to hire them to stay solvent.

Universities Struggle Through Default

The other side of student debt is the struggling college that needs to be paid by the government for the services already rendered.  Colleges are often chosen for their specialties, like engineering or nursing or whatever advances a student best in their interests.  This means to be constantly up-to-date with equipment, the newest computer technology, modern laboratories, libraries that hold not only books but also media equipment and computers.  Dormitories are also constantly in need of repair.  A fiscal budget must meet many expenses and, hopefully, have some reserves.  When students are in default, the government will not allot that money to the universities or colleges. 

A Last Effort

Some higher learning institutions have reached for harsher tactics to ensure that future generations of students can engage in a good college education.  Some outright sue the student in a court of law.  Other universities or colleges use debt collection agencies to recover some of the money owed to them.  Collection agencies are busier than ever as the economy has hit a long-term low point.