Student Loan Question

[Allison]

Sorry you feel that way but I am just arming her with the facts. I don't want anyone to get a free ride but at the same time, she has some valid points. The entire student loan industry has become a corrupt predatory organization that feeds on a student's naivete and a parents lack of understanding. In many cases, the financial aid offices are knee deep in the process, encouraging and sometimes requiring students to apply for loans even when they don't need them.
Before you burn my avatar in effigy, let me state that I understand that not all financial aid professionals do this but as an industry, it's a sickness. That is why some of the more reputable institutions have disavowed student loans altogether.
So, does a person have a responsibility to pay back a debt? Absolutely but in response to your suggesting that I a coaching her on how to screw the taxpayers - hogwash. I am simply arming her with the facts. It's the schools and the financial institutions that are screwing the taxpayers. Just ask Andrew Cuomo.
The Cuomo investigations revealed that schools and lenders had partnered up in countless acts of deceptive practices designed to encourage college kids to take out unnecessary loans.

http://www.oag.state.ny.us/press/2007/mar/mar15a_07.html

You are painting with a very broad brush. The entire student loan industry is not corrupt and student loan offices are filled with honest hard-working people doing the best they can to help students and their parents. All Cuomo did was find a few bad apples as an example and what he accomplished was to hurt students more than he helped anyone. And the "more reputable" institutions haven't disavowed loans because they think the industry is corrupt, they did it to attract families who make too much money to qualify for a lot of scholarships but not enough to be able to pay the full cost of attendance and of course, the good publicity didn't hurt.

 

[creativeamanda]

I have a federal direct student loan that I took out for grad school (graduated in 1996). I was definitely allowed to take out more than tuition. As it was explained to me, it's assumed people will be using that money for other living expenses while they're in school.

Well, then, I'm thankful to the college. I came out of school with a bachelor's degree and $6000 in student loan debt. With graduate school, I was able to get the federal govt to forgive it (something they do for people going into special education up to I think $17,000). But I didn't take out more than the needed amount then. I didn't even think I was allowed.

 

[koalababy]

I wish people would stop suggesting this person sub or teach. I do NOT want her sharing her uniques life view with my kid.

No kidding.

Sorry you feel that way but I am just arming her with the facts. I don't want anyone to get a free ride but at the same time, she has some valid points.

The OP has no valid points. She doesn't want to pay back her student loan. Her "excuse" of being 18 and not understanding what a loan is absolutely ridiculous. If it is true (please lady, do not become a substitute teacher) then it still doesn't matter. She still owes that money. She doesn't want to pay it back and she doesn't want to get a job. That's it. And we're talking about $200 a month. That's not a lot. Especially for someone who's not already working 40 hours a week. .

I didn't read all the other replies so I'm sorry if this is a repeat.

Call and speak to someone, if they cant help, speak to the next higher up and keep going and explain the situation.

What's her "situation"? That she doesn't want to get a job to pay off her bills? Maybe I should try that too with my mortgage company.

 

[Free4Life11]

You are painting with a very broad brush. The entire student loan industry is not corrupt and student loan offices are filled with honest hard-working people doing the best they can to help students and their parents. All Cuomo did was find a few bad apples as an example and what he accomplished was to hurt students more than he helped anyone. And the "more reputable" institutions haven't disavowed loans because they think the industry is corrupt, they did it to attract families who make too much money to qualify for a lot of scholarships but not enough to be able to pay the full cost of attendance and of course, the good publicity didn't hurt.

Thank you! Most lenders DON'T want borrowers to default. Where I work, our default management team is the fastest growing team. All of the due diligence required (letters to borrower, reference, school, phone calls) gets expensive. And sure the loans are guaranteed, but the guarantee percentage is decreasing and upper management doesn't our borrowers to default, so I'm pretty sure we aren't making money when borrowers default!

Might I add that the State of N.Y. has sure made out nicely as Cuomo demonized so many lenders and institutions. Many were shamed so badly they were just about required them to send million dollar "apologies." I sure hope that money is going to provide scholarships and assistance to college students!

I understand there was corruption in the industry, but at the same time don't discount the millions of students and families who have been able to afford a college education because of this industry.

 

[stitchlilo]

You can take out more in loans than the amount of tuition? When I was in college, we were not allowed (I graduated in 1996). Was this just something our college's financial aid office did?

Not more than my tuition. I had money saved, so I could pay my entire tuition without the loan, but knew that the next semester I would be short.

 

[Goobergal99]

I have student loan debt and am still going to Disney... granted I am paying on it, but none the less I have debt...

In any case, they will definently garnish your wages, I had a friend that never paid and she came to me complaining about having less money in her paycheck. When I looked on the stub, i saw PHEAA at the bottom under all her taxes and benefits. A $50 monthly payment turned into $200 every two weeks! If there is anything you shouldnt mess with, I would say the government. Just pay back the loans! they will work with you trust me, call them and don't get off the phone until you work it out.

For the record I graduated with the max debt for an independent student
(46,000) and even after 10,000 loan repayment by my employer, I still had 36,000 to pay. I consolidated and over a 20 year period (already almost 5 years banged out already!!) I pay about $220 a month, it isn't a joyful payment but better then owing the government my tax return.