Field Report

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Jose Reynoso

Severity of and Remedies for the Student Loan Debt Crisis

Writing for the Social Sciences/ ENG 21002/ City College of New York

May 14, 2019

Acknowledgements: Work by Annabelle Surya, Abigale Garpestad, Ayouba Kamara

Table of Contents

  1. Abstract…………………………………………………………………………………….2
  2. Introduction………………………………………………………………………………..2
  3. Literature Review………………………………………………………………………….6
  4. Methods and Materials…………………………………………………………………….9
  1. Participants………………………………………………………………………..9
    1. Field Observation Participants…………………………………………….9
    2. Interview Participants…………………………………………………….10
    3. Survey Participants……………………………………………………….10
  2. Materials………………………………………………………………………….11
  3. Procedure………………………………………………………………………………11
    1. Field Observation Procedure………………………………………………….11
    2. Survey Procedure…………………..…………………………………….11
    3. Interview Procedure………………………………………………………13
  4. Limitations……………………………………………………………………….14

    5. Results………………………………………………………………………………………15

  1. Field Observation Results………………………………………………………………..15
  2. Survey Results……………………………………………………………………………16
  3. Interview Results…………………………………………………………………………19

  6. Discussion……………………………………………………………………………………25

  7. References…………………..……………………………………………………………….28

Abstract

Students have struggled to afford their higher education costs for decades, and those who can’t are obligated to take out loans. These loans can accumulate to hundreds of thousands of dollars, making it difficult for graduates to create a life outside of debt. The purpose of the following study is to evaluate the remedies offered by financial aid/government officials to combat the student loan crisis. To gain an understanding of the severity of this crisis, interviews, and surveys were conducted with community representatives and individuals who have been negatively affected by their student loans. The survey results conclude that more than half of the students surveyed at Fordham University have taken out loans to cover tuition costs. 23.3% of Fordham University students surveyed have taken out $20,000- 35,000 in student loans. 3.3% said they have taken out $75,000-100,000 in loans and another 3.3% have taken out over $100,000 to cover tuition costs. Meanwhile, students surveyed attending CUNY have taken out no more than $20,000 in loans. However, 65% of students surveyed who attend CUNY have not taken out loans. It is no secret private universities are drastically more costly than CUNY schools. Nevertheless, attending a student’s top choice university should not bury them in a lifetime of debt.

Introduction

Higher education is seen as a privilege for most people. In many parts of the world, access to college and university is only granted to individuals of a certain group. There have been times in the past where gender and race have played a part in deciding whether someone would have access to higher education. America prior to the 21st century century is an example of this. However, nowadays this is based mainly on how much money someone has. While anyone can attend college regardless of gender or race, many people choose not to due to how costly going to college can be. According to an article titled The Average Cost of College During 2018, during the 2017-2018 academic school year, the average cost of attending a four-year private college was $34,740. On top of this, the cost is only going up as a the student attends college. This is a major increase from what tuition cost back in 1978. An article called Median Incomes v. Average College Tuition Rates, 1971-2016 estimates the cost of attendance for a four-year private college in 1978 to be around $4,610. Furthermore, this drastic increase in college tuition is combined with very little increase in the cost of living. This difference makes it very difficult for those who want to pursue higher education to be able to afford college and afford basic necessities like food and shelter.

In order to circumvent this problem, many students will take out student loans to pay for college. Some students may be able pay the full price, but most students can’t. Scholarships help with paying for college, but not every student is awarded scholarships to pay for college in full. To pay for college, students take out loans. These loans are then paid after graduation. This is done under the assumption that the student will have a well paying job immediately after college in order to pay off their loans. However, often times this isn’t the case. The cost of attendance in America isn’t that much more expensive than other countries, and students in other countries also take out loans for school. So why is America’s student loan debt so bad? One common reason that is used to explain this is the method in which Americans must pay back their loans. In the US, there are different types of repayment plans that can be used to repay student loans. An article titled Understand Student Loan Repayment Plans goes into detail about three types of repayment plans. Standard repayment sees debt being paid back in monthly payments over ten years. Extended repayment extends this to 25 years instead of ten. Income-driven repayment plans work a little differently, as they take into account the income of the borrower and uses this to determine how much is paid back monthly over the course of around 20 years. Australia uses a system similar to America’s income-driven repayment plans. However, Australia isn’t facing a student loan debt crisis like America is. An article on the New York Times titled America Can Fix Its Student Loan Crisis. Just Ask Australia, by Susan Dynarski, claims that Australia uses the system of income-driven repayment, but implements it a lot better than America. One major difference between Australia and America is that Australia seems to prioritize borrowers basic needs before anything else. “The idea is that no one facing economic hardship should have to choose between paying student debt and paying for basic necessities.” writes Susan, as she describes that Australia tends to borrowers needs before demanding payment on their loans. Furthermore, Susan explains that payment is based on income earned and that it automatically adjusts, something that isn’t done in the income-driven plans in America. It’s due to this that Australia is able to refrain from having a student loan debt problem.

According to an article on Forbes called Student Loan Debt Statistics In 2019: A $1.5 Trillion Crisis, by Zack Friedman, as of February of 2019, over 44 million borrowers owe $1.5 trillion worth of student loans. This shows just how serious the student loan debt crisis is and leads to one important question; how did it get this bad? This is most likely due to how students are expected to pay back their loans. After graduating, people have six months before they must begin paying their dues. This six month period is supposed to give newly graduated students a chance to get settled down and find a job before they begin having to pay. However, this isn’t always the case. Whether or not an individual is able to secure a job right after college, the individual is still expected to begin payment after six months. These dues may not seem like a lot to some at first, but the amount adds up, and after some time many students default on their student loans. This situation is all too common. To avoid defaulting on their student loans, many people turn to the aforementioned repayment plans. While these plans do serve as a way to repay loans over a long period of time, many borrowers still find themselves defaulting on their student loans.

With this student loan debt crisis showing no signs of slowing down, this leaves one question to be asked; what exactly is being done to remedy the situation? With the student loan debt crisis as bad as it is, it’s easy to assume that nothing is being done to remedy the situation. However, many organizations are actively combatting this situation. Groups such as Neighborhood Trust Financial Partners are holding events in order to inform people about the various ways of dealing with student loans. These kinds of efforts are helpful to the general public, however, the student loan debt crisis remains a large scale issue that shows no signs of slowing down.

Currently, research is being conducted on this topic. This study aims to explore the severity of the student loan debt crisis and the various ways in which the situation is being remedied. Individuals will be interviewed in order to get a sense on how some people deal with their student loan debt as well as what they are doing to help others in a more unfortunate situation. The study will focus on two private, non-profit colleges; Fordham University and NYU. The data collected in the study should give more insight on how badly student loan debt may have affected people and what is being done to combat this crisis.

Literature Review

College has become so expensive that it can be seen as more of a luxury rather than a necessity. In an article written by Sarah Goldy-Brown titled “The Average Cost of College in 2018”, published on StudentDebtRelief.us (2018), the average tuition of private 4-year college was estimated to be around $34,740. This cost changes when talking about 4-year public colleges, which charge out-of-state students an average of $25,620 and in-state students an average of $9,970. Furthermore, the cost of attending these schools keeps on increasing over time. During a student’s four years at college, he/she can expect to see a 2.4% price increase in private colleges, and a 3.2% price increase at a public college. The aforementioned prices are only the base tuition, however. On top of this price, the cost of items like books, food, and shelter must also be taken into consideration. This results in an even more expensive cost for education.

Because of all the aforementioned expenses, it should come as no surprise that students struggle to pay for their education. With the cost of attending college being so high, there is almost no way in which a person of average income can afford to pay for it all. An article titled “Median Incomes v. Average College Tuition Rates, 1971-2016”, published on ProCon.org (2017), shows how the median income of a man and a woman compare to the average cost of college from 1971 to 2016. The article finds that in 2016 the average annual tuition, fees, room, and board cost an average of around $45,370 for 4-year private nonprofit colleges, and $20,150 for 4-year public colleges. When compared to the median annual income of a man ($38,869) and a woman ($24,892), the cost of college far exceeds it. However, this wasn’t always the case. The average cost of college in 1971 was only around $2,930 for 4-year private nonprofit colleges, and $1,410 for 4-year public colleges. Furthermore, when compared to the median annual income of a man ($6,903) and a woman ($2,408) in 1971, the cost of college doesn’t exceed it, and is more affordable.

With the cost of college being almost unaffordable to many students, how exactly do students pay for their education? In order to pay for college, students take out student loans. These loans, however, aren’t free money. Because these are loans, the money must be paid back after graduation. An article titled “Understand Student Loan Repayment Plans”, published on mygreatlakes.org, explains the different options borrowers have in order to pay back these loans. There are three types of loan repayment plans. These include standard repayment, extended repayment, and income-driven repayment. Each plan has the borrower repaying their debt in monthly payments over the course of 10 (standard) to 25 (extended) years. The income-driven plan works slightly differently. In this type of plan, a borrower must make monthly payments based on their income. This type of repayment plan seems to be the best way to repay student loans, but America puts a lot of limitations on the eligibility of being able to use this type of repayment plan.

One country that allows its borrowers to repay their loans based on their income is Australia. An article written by Susan Dynarski, titled “America Can Fix Its Student Loan Crisis. Just Ask Australia” (2016), explains how Australia’s repayment system works well for the country despite students taking out just as much in student loans as they do in America. Dynarski states that Australia’s method of repaying student loans works because there are certain regulations put in place. For example, borrowers are not required to start making payments until they reach earnings of $40,000 or above. This isn’t the case in America, where  borrowers must begin repayment only 6 months after graduating regardless of financial status. Furthermore, the amount that is paid back monthly can change based on an increase or decrease in earnings; something that requires more work to do here in America. Using this comparison, Dynarski makes the claim that America’s repayment system is worse than Australia’s.

By using a standardized system of repayment, Australia is able to avoid having a student loan debt crisis as bad as America’s. With students not being able to repay their student loans, it’s no surprise that the national student loan debt is $1.5 trillion, according to Zack Friedman, who wrote an article titled “Student Loan Debt Statistics In 2019: A $1.5 Trillion Crisis” (2019). With over 44 million borrowers contributing this crisis, this is definitely a situation which affects the country as a whole.

These articles were useful in providing much needed insight on this topic. Each article dealt with a specific part of the topic ranging from the average cost of college in recent times to the statistics of how much is owed by over 44 million borrowers. The information provided helps to create a narrative that paints the student loan debt crisis as the severe crisis that it is. However, this leaves one major question to be asked. What exactly is being done to remedy the situation and why is it not working? While efforts are being made to alleviate the situation, many people aren’t seeing positive results. Currently research is being conducted with the hopes of finding out just how bad the situation is, and what some people are doing to help those dealing with this problem.

Methods

Participants

    Field Observation Participants

The field observation was conducted at a Student Loans Workshop conducted by the Neighborhood Trust Financial Partners (NTFP) on Saturday, March 16th, 2019 in 2751 Grand Concourse, The Bronx, New York. Attending the workshop was a method in understanding/learning the statistics, problems, and remedies regarding those dealing with student debt. The speaker was Eric Espinoza, a financial counselor at the company who has dealt with many cases regarding student loans with his own clients. As a worker in the field and, thus, a very informed person on the subject, he agreed to set up an interview for the study over the phone.

One of the participants of the NTFP was Olga Baez, a woman who had a significant insight to share with her fellow audience members. She gave helpful tips based on her experience on how to save money during college and talked about how she had loans, herself. She was, thus, approached at the end of the meeting to set up an interview due to her potential in expanding upon her knowledge and insight regarding saving money and in student loans. She happily agreed. It was learned that Ms. Baez has started her own non-profit organization called Strive Higher NY, which helps young students of color reach out and explore different fields of study, guides them through the high school/college application process, and offers significant life advice.

    Interview Participants

When researching the topic of student loan debt, priority was put on finding interviewees with experience in the topic. Potential interviewees consisted of school financial aid counselors, current students, and graduates/non-graduates with substantial loan debt. This would provide some helpful insight into what is being done to help students mitigate their student loan debt. Furthermore, speaking with an official who works in that area would provide extensive knowledge on how students or graduates should proceed with handling their debt. Lastly, interviewing a student or graduate with student loan debt would provide insight into how people affected by the crisis first-hand deal with their debt. Therefore, Eric Espinoza was interviewed for his experience as an advisor at Neighborhood Trust Financial Partners. Olga Baez was selected due to having the first-hand experience with student loans and having knowledge gained from initiating her non-profit organization, Strive Higher NY.

      Survey Participants

Thirty successful, self-administered surveys were taken at the Lincoln Center campus of Fordham University in front of the main building. All participants were either currently pursuing a degree or have already graduated.  Roughly ten people declined to take it.

Thirty more surveys were taken at the City College of New York. The surveys taken in the class were used, and the rest were taken from the online Google Form, shared on social media. Therefore, the CUNY group of students were either from the classroom or have a connection to a group member.

Materials

The materials used during the field observation was a notebook, a laptop, and the Student Loans Workbook that was provided. To conduct surveys, there were both physical copies and an identical Google Form that participants answered on. For the interviews, a cell-phone voice recorder was used, a cell-phone to talk was used, and laptops to take notes were used.

Procedure

    Field Observation Procedure

A field observation was conducted on March 16, 2019, at a workshop hosted by the NYC Department of Consumer Affairs Office of Financial Empowerment, in cooperation with Neighborhood Trust Financial Partners, which sought to help attendants with their student loan debt and how to manage their repayment. It was in a large room similar to a classroom setting. Attendees sat at large tables facing the speaker who used a small whiteboard. The questions people asked and the tips they gave were paid close attention to during the workshop. It was hoped to achieve greater knowledge on the remedial measures of student debt provided by the government or other institutions. Using an informative, interactive guidebook, the workshop offered valuable insight on how to manage one’s student loan debt. It also provided a sense of the type of people who struggle with student loan debt. This field observation was participatory, but participation was kept to a minimum.

    Survey Procedure

Surveys were conducted in order to collect data on the number of student loans taken out by college students, as well as how those students would deal with the debt. The target audience included graduates or current college students as they were more likely to offer insight on their experience or expected experience with student loans. The focus was put on surveying students of Fordham University and students of City College. Fordham University was chosen due to the school’s reputation for high tuition. Because of this, students of Fordham University were more likely to be on the severe end of student debt and were be able to provide significant responses regarding their experiences. City College was chosen because it is a CUNY school, therefore providing insight on the issue of student debt from another perspective.

A total of eight questions were asked on the survey. The surveys administered were intercept surveys. The questions on the survey mainly consisted of multiple choice questions, with one dichotomous question and one open-ended question. The variety in question types allowed for the categorization of these responses in order to compare results. The demographic questions related to income, level of education, and occupation. To allow the surveyed to be more comfortable sharing income level, ranges were provided for each answer. The other questions focused on their experience with student loans, whether they have it or not, so anyone may provide feedback about how they feel towards student loans. To create a space for this feedback, the open-ended questions asked if the degree was worth the debt, and what can be done to help remedy the crisis.  

The physical survey was conducted on April 4th, 2019 between the hours of 1 pm to 3 pm. Participants most important to this study were those with some amount of student loan debt, therefore, students at the Fordham University Lincoln Center Campus, located at 113 W 60th Street, New York, NY, were targeted. Of the participants approached, 30 responded. Surveys were also conducted online via Google Forms from April 4th, 2019 to May 8th, 2019. Furthermore, surveys that were conducted on physical paper at Fordham University were transferred to the Google Form. This format was chosen because of the ability to obtain a higher reach than stay within the limits of paper copies, time constraints, and physical boundaries. A Google Form was being sent to an audience that was unable to be reached otherwise. Also, a Google Form automatically categorizes results and creates a visual of the responses, which was convenient when creating charts and graphs in Microsoft Excel.

    Interview Procedure

Potential interviewees were selected based on their knowledge and/or experiences with the student loan debt crisis. The target interviewees comprised of: one who is knowledgeable of the issue and works closely with student debt remedies, one who experienced student debt his/herself and can provide his/her story, and one who works in a financial aid office at Fordham University to discuss his/her advisement to students regarding loans. A total of five interviews were requested. Of the five interviewees, two responded. Interviews were conducted on April 4th, 2019, and April 9th, 2019.

The first interview, conducted on Thursday, April 4th, 2019, was face-to-face in a semi-structured format in order to gather as much input as possible with follow up questions as the interview continued. The interviewee was Olga Baez, a former student of Fordham University who now works at the school and has founded her own organization which aims to help students get through college. A total of five questions were written prior to the meeting in order to guide the conversation and to ensure a touch on relevant points. The questions also aimed to collect as much insight as possible on Olga’s role in this field. However, many of her points were worth expanding upon, so a few additional questions were asked when appropriate. The second interview was conducted over the telephone on Tuesday, April 9th, 2019, for the interviewee’s convenience. This interviewee was Eric Espinoza, an associate director of programs and strategic advocacy for Neighborhood Trust Financial Partners. For him, questions were geared toward his specific experiences in working with people with student debt. His responses would thus lead to stories that magnify the severity of the issue, and he would offer his knowledge on student loan remedies. Similar to the prior interview, this interview was also semi-structured and consisted of four questions, which also aimed to gather insight on Eric’s role. This semi-structured method allowed Eric to follow-up on his responses to clarify certain points or to expand on his responses. Furthermore, both interviews were recorded on a telephone recorder and notes were taken as the interview took place.

    Limitations

The most prominent limitation of the study is the survey’s respondents; feedback from students and graduates was crucial, thus surveyees were chosen based on a convenience sample of the students who were around Fordham’s campus at a specific time, meaning their responses could not be generalized to the entire school. This also highlights another limitation that was present in the study: sample size. In order to get more accurate data, a larger sample size of more than 1,000 would be needed. This is due to how big of a situation the student loan debt crisis is and the fact that it affects many students in the country as a whole. This kind of sample size would prove to be impossible, however, given the time constraints on the study.

Furthermore, the study would have benefitted from responses of various other groups. Input from government workers would have been very valuable. A worker in Department of Consumer Affairs should have been contacted for their input in what New York can expect in the future in terms of student debt, and what is currently being done to remedy the crisis. The study would have also greatly benefitted from surveying students who attended other private, non-profit colleges. In this study, only one private college was looked at. In order to gather more insight and better data, more colleges could have been involved in the study. However, due to time constraints, it proved to be difficult to involve other schools aside from the two already involved.

Results

    Field Observation Results

By attending the workshop, many attendees were older and most of them had already completed college and were currently in debt. One man, who spoke a lot, had just finished paying off his loans and seemed to be there just to offer advice or gain knowledge to share with other people. There were several remedial measures to student debt offered, and the most significant was simply awareness on the options people have regarding paying off their debt, and options besides debt, such as scholarships and government aid. A way to best understand these options is taking advantage of the free financial advisement given by one of New York’s Financial Empowerment Centers. Many people inquired about loan forgiveness, and it was learned that loan forgiveness is difficult to achieve.

    Survey Results

Figure 1: A majority of students at Fordham University did not take out loans, or expect to not take any out any.

Figure 2: A majority of students at the City College of New York did not take out any student loans (65.5%). Furthermore, students took out no more than $20,000 in loans.

A total of 59 students were surveyed. 30 of the surveys completed were taken by students at Fordham University. 29 surveys were completed by students of the City College of New York. Questions were asked to gain insight on how students were affected by student loans. When asked how much a student took out or plans to take out in loans, the majority of students responded that they didn’t take out or plan to take out loans. Of the 30 surveyed at Fordham University, 12 responded that they had no intention taking out loans. Likewise, of the 29 surveyed at CCNY, 19 responded that they didn’t take out loans. In terms of how much loans were taken out by students at both schools, 36.6% of students surveyed at Fordham University took out more than $20,000 in student loans. In contrast, there were no students surveyed at CCNY who took out more than $20,000.

Figure 3: Shows how long it will take for students at CCNY to pay off their loans. The majority (65.5%) said that they don’t plan on paying their loans back.

Figure 4: Shows how long it will take for students at Fordham University to pay off their loans. The majority (40.0%) said that they don’t plan on paying their loans back.

When asked how long they expected it would take to pay off their loans, the majority of students answered that they don’t have loans or they don’t plan on paying their loans back. According to figure 3, 19 out of the 29 students surveyed at CCNY will not be paying back their loans, and according to figure 4, only 12 out of the 30 students surveyed don’t plan on repaying their loans. The longest amount of time that CCNY students predicted it would take to pay their loans was 10 years. This was different among the students surveyed at Fordham University, where according to figure 4, some students believed that it would take them over 10 years to pay back their loans.

As expected, students attending Fordham University have taken out significantly higher amounts in student loans than CUNY students, and expect to take double the amount of time to pay them off. 23.3% of Fordham University students surveyed have taken out $20,000- 35,000 in student loans. 3.3% said they have taken out $75,000-$100,000 in loans and another 3.3% have taken out over $100,000 to cover tuition costs. Meanwhile, students surveyed attending CUNY have taken out no more than $20,000 in loans. Students attending CUNY schools have a greater chance of not having taken out loans than private university students.

A whopping 65% of students surveyed who attend CUNY have not taken out loans. A drastic difference from the 40% of Fordham University students surveyed who have not taken out loans. The other 46.7% of students attending Fordham University believe it will take no more than 5-10 years to pay off their loans. And 3.3% believe it will take over 26 years to pay off their student loans, comparative to CUNY students who believe their loans will be paid back within a maximum of 6-10 years. Even so, a majority of CUNY students who have taken out loans believe it will take 3-5 years to complete.

Interview Results

Two experts were interviewed in their domains and the interviews were conducted in different manners. The first interview took place at Fordham University and lasted 40 minutes long. The interviewee’s name is Olga Baez, the founder of Strive Higher New York, founded in the summer of 2017. During the interview, Ms. Baez explained why she created this initiative. As a resident of the Bronx, she wanted to help those who cannot get access to a certain type of education, especially Blacks and Latino. She also aids middle school and high school students in preparing for college. She helps students who apply for scholarships become well informed about student loans and also apply for internships. She is a borrower herself and currently owes 45,000 dollars in student debt, but she doesn’t regret her decision to take out loans because it has helped her earn two master’s degrees.

The second interviewee, Eric Espinoza, works for Neighborhood Trust Financial Partners. The interview with Mr. Espinoza was conducted via a telephone call and lasted more than 25 minutes on March 16th, 2019. Various questions were asked about his field of expertise and personal opinion on the matter. During the interview, Mr. Espinoza explained his role as a counselor in Neighborhood Trust, including the function of this organization to assist in the student debt crisis and what role the federal government can play to improve this situation.

Interview with Eric Espinosa

Jose: What work have you done specifically to assist students struggling to pay their student loans?

Espinoza: I started as a financial counselor in Neighborhood Trust in 2012 and a lot of work is divided into categories. There were those who their employers gave them everything that was promised and they were able to get a job in an area where they could manage all the goals they had in order to focus paying back student loans and help them prioritize their student loans payment goal and help their family members, that was one category how would directly help people to back their student loans.

The other thing is to make them aware the payment program that they have access to, would allow them the most flexibility and fit in other priority that they have as a potential student loans forgiveness program that they had explored. Those are kind of the happier side of student loans programs, but the frightening side is how to get their loans out of default. That’s what would happen to your student loans if you are unable to pay them back within nine months.

You know a number of things we will do are to negotiate with federal to try a lower student loans payment temporarily or permanently based on the way they were trying to get back on track.

Jose: How do you feel the government can improve the student debt crisis?

Espinoza: There are a lot of things they can do. I think that there is generally a lack of awareness, first of all, they can make signing up for student loans a lot better, more comprehensive and more understandable also give true information for both student borrowers and their family members. They should tell them what kind of loans they qualify for in order for them to be able to pay them faster; because some schools do not clarify what students need in order to borrow just for their tuition, but generally the living cost and books are all stuff that student must have for their education that what makes it a little harder. And they need to make the repayment plans simpler. There needs to be a plan for students to ensure their senior year, then when they graduate, they will know what to do to pay off their debts. Also, the local government could really help on where students could go for free advice because, with this crisis, a lot of people are getting rich just to help people learn how to manage their student debts.

Jose: In your personal opinion, do you think a college degree is necessary to lead a successful life?

Espinoza: You know I feel like that a tricky question. No, but it depends on how you define success, some people want to live life with relatively low stress and meet people all around the world or being a parent. I think there are a lot of ways to be successful without a college degree, but realistically in the job market that exists right now, it’s very difficult to access a stable full-time job without a college degree. I think the concern should be what you pay for a college degree and how much of the quality degree you got. Do employers care how much you pay to earn that degree? Those are the concerns.

Jose: What is the worst situation you have witnessed as a direct result of student debt?

Espinoza: There are so many, I think one example is there was a student who got behind on his student loan payments and was trying to resolve by buying them back. The department of education hired some people to try to help those who are back in their repayment. A certain amount is paid to that collection agency. So the late borrowers have to pay another amount just to get back on track. Sometimes they also are planning to take people’s social security payment but they are supposed to do that. I think that those are the worst situations I have witnessed.

Interview with Olga Baez

Annabelle:  Tell me about Strive Higher NY and your role in it.

Ms. Baez: Sure, so I started Strive Higher NY in summer 2017… basically the idea is to expose middle school student of color and high school student to different experiences and opportunities, so I take them on college fair and we focus on literacy and career. The idea is to get students prepare for the future and start thinking about all differences and opportunities out there and teaching them financial literacy and different careers that are availables. We help them to get scholarship and internships with some financial institutions…(she smiles) it is a one woman show, I run the program by myself. I also help students how to graduate from college, because what’s the point to go to college if you don’t graduate from it?

Jose: Ok great, next question is What is your experience regarding student debt? What brought you the Student Loans Workshop? And if you did take out loans, how did you go about paying it back?

Ms. Baez: Hum… I wanted to figure out what they were offering that was the reason that I went there, because I don’t see many events in the bronx like this and it seems to be work together, so I wanted to see and I was very happy that they got so many details and informations to share and I wanted to also share that information with others. When it come to my personal experience, I am a first generation college student, so I went to college I knew that i didn’t want to get in debt. I did say that oh I am going to go to college that I want and take my student loan, No I did not have that mindset. I took out a loan in my second year, but I was able to decrease it because of my job position. It was an HRS position. I was able to graduate with a huge amount of student loan, then when I went to grad course, I knew that I am going to have to spend a little bit more. What I can tell people is that if you really want to have a higher education you need to be careful with the amount a debt you taking while you still as undergraduate, because you are going to take loan if you want to pursue your master or Phd. Some student get even paid cut fee base on the statue, so it better to know about all these opportunities that my lightinen your loan.

Jose: Do you mind sharing how much student loan that you took out?

Ms. Baez: Yeah sure it’s fine, you know working here as Sophomore undergraduate, I will say it’s definitely under $20,000, and I graduated in 2005, so temporary long time ago, it was a small college but I did get accepted into PES, and the financial package was completely different from small school so I was scared to go PES. You know when you graduate from college they give you 6 months, then after you gonna need to pay your student loans. So right now I would say that I have about $45,000 as student loans with interest with my college degree. I got two master degrees so I would say that it’s a lot money but it’s worthy what I have receive from it. I am on 10 years plan with the process that I am into it right I think I am going to be able to finish pay off in 10 years.

Jose: What would you advise new students (debt free) to do to remain debt free?

Ms. Baez: I think they should continue to apply for scholarships. and continue to save up their money if you are working, with these methods, It will be definitely hard to be into debt.

Jose: What made you realize you were going to get involved? (personal connection to the topic?)

Ms. Baez: Sure, I think my experience growing up as first generation college student that has definitely pay the way to made to become the person who I am today. Unfortunately I don’t think that a lot things have changed since my time in high school and that sad. I think that there are a lot programs but not as much for students to get their degrees. The numbers keep going up for students enrolling in college but not the same as they graduate. It great that blacks and latino are going to college, but other side how many of them graduate from it. Statistic shows that 36% of students graduate from 2 years college within 3 years.

Discussion

There is no doubt that the student loan debt crisis has affected the majority of students all across the country. The effects of the crisis can be observed in just about any university in the United States. However, not all students are affected in the same ways. Students who attend or have attended private, non-profit universities, like Fordham University, have different experiences with student loans than students who attend CUNY schools. The study found that on average, students at Fordham University had taken out and are more likely to take out a large amount of money in students loan compared to students in a CUNY school. This was expected as Fordham University is known for its high cost of attendance. CUNY schools are public schools and are very cheap in comparison to private schools. Results from the study also show that the highest amount of student loans taken out by CUNY students was less than $20,000. This finding was significant as it is highlights a gap between Fordham students and CUNY students. Fordham students take out more loans than CUNY students. Of course, this finding was expected. However, it still comes as a surprise that the difference is as large as it seems. These findings also highlight the difference in cost between CUNY schools and private schools.

The interviews conducted give insight on what is being done to remedy the situation. Olga Baez explains that students should be exposed to the various methods there are in order to pay for college. This remedy to the student loan debt problem would definitely help in minimizing the amount of damage done by student loan debt. Student loans are taken out in order to pay for college. Often times, the individuals taking out loans are those who don’t have the money to pay for school. Informing these individuals of other payment methods, like scholarships and grants, could help prevent cases of massive student loan debt. Furthermore, organizations such as Olga Baez’s Strive Higher can be beneficial in providing support for the students who need it when it comes to paying for college. This is another way in which the student loan debt crisis can be remedied. Another simple, yet effective, method of combating the crisis is to make the process of taking out loans and paying them back more simple. Eric Espinoza explained that the current way things are done is ineffective and only serves to confuse people. A streamlined process of taking out loans and repayment could help those who may not completely understand this process to begin with. This could lead to people making more knowledgeable decisions and would therefore decreases the amount of people who get stuck with debt they can’t pay back.

References

Dynarski, S. (2016, July 09). America Can Fix Its Student Loan Crisis. Just Ask Australia. Retrieved from https://www.nytimes.com/2016/07/10/upshot/america-can-fix-its-student-loan-crisis-just-ask-australia.html

Friedman, Z. (2019, March 07). Student Loan Debt Statistics In 2019: A $1.5 Trillion Crisis. Retrieved from http://www.forbes.com/sites/zackfriedman/2019/02/25/student-loan-debt-statistics-2019/#69fc02d3133f.

Goldy-Brown, S. (2019, May 09). The Average Cost of College in 2018 – Student Debt Relief. Retrieved from http://www.studentdebtrelief.us/news/average-cost-of-college-2018/.

Median Incomes v. Average College Tuition Rates, 1971-2016. (n.d.). Retrieved from https://college-education.procon.org/view.resource.php?resourceID=005532

Types of Federal Student Loan Repayment Plans – Great Lakes. (n.d.). Retrieved from https://mygreatlakes.org/educate/knowledge-center/know-your-options-repayment-plans.html