learner Loan crisis Brewing In The United States

America Student Loans - learner Loan crisis Brewing In The United States

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This mandated discount in the interest rate charged by lenders, in theory, was to help American College Students to afford their education. The reverse ensue has happened, as by reducing the interest rate on student loans, the government has mandated a discount in the profitability on those loans, production them less desirable as an venture to the investors who purchase these loans from banks.

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America Student Loans

Investors in these loans supply the liquidity to the banks to make time to come loans. Without this liquidity or capital, banks do not have the money to make new loans.

Recently nearly 70 student Loan Lenders have suspended their lending, as liquidity has dried up from investors and lenders do not have the capital to make new loans. This list includes the nations largest bank...Bank of America, who three weeks ago stop lending money for student loans.

Congress, the animal who created this qoute last fall, by trying to mandate interest rates on student loans and who has no company setting prices in a Free store Economy, is currently attempting to fix the problem.

Three weeks ago the Us House of Representatives passed legislation to allow the division of instruction to purchase loans from lenders on the secondary market, to supply liquidity to student loan lenders, so they can make new loans. The program is called the "Lender of Last Resort Program".

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