MOm wants dead son's student loans forgiven

[disney1990]

If everyone who signed the petition would have sent in a nickel, that pays off the loan. Problem solved!

The fact is she co-signed the loan which puts her on the hook. Would it be nice if the loan was forgiven? Sure. It would also be nice if my mortgage company forgave my loan.

You are right. Seems simple enough. If every loan was forgiven because one of the people died, the banks would not be happy.

Maybe she should set up a page on http://www.indiegogo.com/

She could ask people to contribute just $1 or $5. Perhaps she would raise enough money to pay it off.

 

[Lionqueen2]

Those who walk away from their student (and other) loans may think it doesn't affect their ability to get credit, but it certainly does affect the rate. A friend who owns a car dealership told me he has had customers who don't understand why they have to pay high interest rates on car loans - they pay their credit cards and mortgages but don't pay their student loans (as if those don't matter). A former coworker of mine asked me if 8.5% was a good interest rate on a loan for a new car

In addition, those who walk away from loans may also be jeopardizing their job opportunities. Not all employers are eager to hire people who demonstrate irresponsibility with their own finances.

 

[BeachGirlFLA]

And people are stupid. If that woman couldn't pay the loan back, then she shouldn't have co-signed for it. Banks aren't there to make sure people are OK, they are there to make money. They don't need to have a heart, people who use them just need to have brains.

And I wouldn't say all banks are heartless. The bank I work for wants to make sure that the loan is actually in the best interest of the borrower as well as the bank before we make it. Yes, we are in the business to make money but we also do things to protect the borrower when we are underwriting the loan.

 

[BeachGirlFLA]

How many more mortgages do you plan to apply for? How many more car loans?

34 is the average age of first time home buyers.
60 and beyond are actually getting reverse mortgages. LOL.

do you plan on getting a new house at 80 or 85? Sorry in fact a lot of 80 year olds are trying to get rid of assets so they won't go destitute trying to get long tern care.

I'm approaching retirement and really don't give much fig to my credit score. My house is paid off, my cars are paid off. don't need great credit to get a new one as if I need one it will be used and either paid off fully or a huge down payment. And as I said, at least in NJ every other commercial is from a car dealer screaming that you can get a new car for $1 dollar down.

Just saying typically at that age, major credit purchases are behind folks. In fact, most are doing the naked "I just got finished paying my mortgage" dance.

Most seniors I know are like me, if I ain't got it by now and I can't get it with cash, then you know what, I don't need it.

I underwrite several mortgages each week that are for people over 60 (and I'm not just talking about refis.) They're usually my easiest ones since pension and social security are very easy to document and to calculate.

 

[scrapquitler]

The entire situation seems rather heartless.

What's heartless, that the bank wants to be repaid what the Mother agreed to pay? That's the reality of co-signing...it means the co-signer is legally obligated to pay the debt if the other person does not. Should the bank just forgive every co-signer who can't pay? In the end, that would just end up costing everyone else a lot. If you think you can't pay the payments, then you should NEVER co-sign.

 

[tvguy]

For those considering student loans, as unpleasant as thinking about your child dying can be, this is why Student Loan Advisors say NEVER go with a private loan, only the Federal Loans.

 

[joviroxx]

Im very thankful for Florida Prepaid College Tuition program. I will have our kids tuition and dorm fees paid off by the time they start!

 

[Planogirl]

Hopefully someone will help this lady out. However she is responsible for the bill.

If I had a nickel for every person I talk to who said that something like that shouldn't be on their credit report since they "only co-signed".

 

[mickeysgal]

Co-signed = co-owned.

She owes the money and she needs to abide by the terms she signed for. A loan isn't a piece of paper that you sign when times are good. It's there for the length of the terms - no matter what is going on in your life. That's why you (general you) enter into these type of agreements cautiously and provide for a Plan B - like life insurance in case something catastrophic happens, emergency money, etc.

She could declare bankruptcy. Otherwise, pay.

 

[trip]

Co-signed = co-owned.

She owes the money and she needs to abide by the terms she signed for. A loan isn't a piece of paper that you sign when times are good. It's there for the length of the terms - no matter what is going on in your life. That's why you (general you) enter into these type of agreements cautiously and provide for a Plan B - like life insurance in case something catastrophic happens, emergency money, etc.

She could declare bankruptcy. Otherwise, pay.

Not sure that you can discharge student loans in a bankruptcy.

 

[robinb]

Not sure that you can discharge student loans in a bankruptcy.

Not federal ones, but as I said before these private loans are glorified signature loans, but with parents co-signing to ensure that the banks get paid back.

 

[luvmy3]

And I wouldn't say all banks are heartless. The bank I work for wants to make sure that the loan is actually in the best interest of the borrower as well as the bank before we make it. Yes, we are in the business to make money but we also do things to protect the borrower when we are underwriting the loan.

I wouldn't call any bank heartless, that implies they would actually have a heart in the first place, and since they are an entity, that is an impossibility. My intention was not to agree with the pp about the heartless part, just to point out that humans should use their brains (something they possess) when dealing with such entities. That, and personal responsibility

 

[trip]

I may be wrong but unless things have changed, this article seems to say that private school loans aren't dischargeable. Following are some excerpts from this article.

http://www.huffingtonpost.com/2012/08/14/private-student-loans-bankruptcy-law_n_1753462.html

But because of a 2005 reform law, private student loans cannot be discharged in bankruptcy, except in extremely rare cases.

Today, with stricter lending rules and a tighter credit market, 90 percent of private loans require a cosigner, and those cosigners also are unable to discharge the debt.

Today, 2.9 million Americans have private student loan debt, owing about $150 billion and representing 15 percent of all student debt.

 

[BeachGirlFLA]

I wouldn't call any bank heartless, that implies they would actually have a heart in the first place, and since they are an entity, that is an impossibility. My intention was not to agree with the pp about the heartless part, just to point out that humans should use their brains (something they possess) when dealing with such entities. That, and personal responsibility

I kind of meant that bank employees/bank execs aren't all heartless as well and I think I quoted the wrong post. It wasn't meant as a correction to you but to those who think that all bank execs are heartless.

 

[luvmy3]

I kind of meant that bank employees/bank execs aren't all heartless as well and I think I quoted the wrong post. It wasn't meant as a correction to you but to those who think that all bank execs are heartless.

Oh, gotcha, and I definitely agree with that.

 

[westjones]

For those considering student loans, as unpleasant as thinking about your child dying can be, this is why Student Loan Advisors say NEVER go with a private loan, only the Federal Loans.

For my girls, they weren't offered enough in federal loans to cover the cost of college. I believe they were offered $5500. That isn't enough for tuition let alone housing.

We didn't take the loans. My girls live at home and are going to the college where my husband works and they both got scholarships, so we didn't have much cost this year and didn't need loans. But for most people, that wouldn't be enough to pay for college, and even working part time (like I did in college) wouldn't make up the difference).

......oh but I agree....it is best to try to never take out private loans. Our wonderful neighbors who lived across the street had two kids in college and they took out home equity loans to pay for their college. Then the dad lost his job, a few months later the mom lost her job....and then they lost their home (the house was just sold at an auction). I wish the bank would have worked out something with them. They were wonderful neighbors and we all miss them.

 

[Planogirl]

I kind of meant that bank employees/bank execs aren't all heartless as well and I think I quoted the wrong post. It wasn't meant as a correction to you but to those who think that all bank execs are heartless.

I agree. I also don't think that being heartless or not really has anything to do with it. Corporations have rules and they are simply following the rules.

I do wish that someone with money could help the lady out though.

 

[DVC-Don]

Mom co-signed, so she has to pay.

 

[robinb]

I may be wrong but unless things have changed, this article seems to say that private school loans aren't dischargeable. Following are some excerpts from this article.

http://www.huffingtonpost.com/2012/08/14/private-student-loans-bankruptcy-law_n_1753462.html

But because of a 2005 reform law, private student loans cannot be discharged in bankruptcy, except in extremely rare cases.

Today, with stricter lending rules and a tighter credit market, 90 percent of private loans require a cosigner, and those cosigners also are unable to discharge the debt.

Today, 2.9 million Americans have private student loan debt, owing about $150 billion and representing 15 percent of all student debt.

Thanks for setting me straight.

So they require a co-signer on a loan that cannot be discharged by either borrower. What motivates the banks to make good choices in determining eligibility when they are virtually guaranteed to be paid back? No wonder so many student loans are in default! I have a feeling that this will be another case of banks making poor lending decisions and getting bailed out by the feds.

 

[allison443]

Thanks for setting me straight.

So they require a co-signer on a loan that cannot be discharged by either borrower. What motivates the banks to make good choices in determining eligibility when they are virtually guaranteed to be paid back? No wonder so many student loans are in default! I have a feeling that this will be another case of banks making poor lending decisions and getting bailed out by the feds.

I think that the non-dischargeability of the loans was passed to encourage banks to lend to students, many of whom are not credit-worthy (young, no job, etc.). Otherwise you would probably have massive borrowing for college, then the student graduates, immediately declares bankruptcy and gets rid of their college debt. They are at the beginning of their earning years and can wait out whatever adverse affect the bankruptcy has on their credit.