Posted on 08/06/2014 6:47:14 AM PDT by Innovative
Lisa Mason had taken out close to $100,000 in student loans in order to pay for nursing school, and was making payments on the debt when she died. Steve Mason said he and his wife, who had co-signed the loans, were contacted immediately after his daughter’s death and were told they must start making payments.
“We knew if she didn’t pay her debt we would be responsible by co-signing, but we didn’t know that if she died the debt would fall to us,” he said.
Mason said his daughter’s debt has ballooned to $200,000 and the payments exceed $2,000 a month.
(Excerpt) Read more at foxnews.com ...
Yes they need a lawyer.
It occurs to me that, if these are private loans, not federal student loans, that they may well be dischargeable in bankruptcy.
Not knowing their financial situation of course. But the dad said their credit is ruined as they have struggled with this. Their credit can’t get any worse if they declare bankruptcy, if possible.
bottom line they need legal advice.
I knew somebody whose husband died. They had a bunch of credit card debt. Some in both names, some just in the deceased husband’s name. She was responsible for all of it. She ended up declaring bankruptcy and was relieved of the debt.
Why? So the debt is spread out to everyone else? Maybe you enjoy paying for everyone else but I'm sick and tired of it. They co-signed so it's their debt. It's not my debt.
You don't have to be an alcoholic to get liver diseases. There's more than one kind. Bad things happen to good people.
Next time get a Life Insurance Policy with the Co Signers being the Beneficiaries.
Huh? I never said anything about alcohol. I was wondering what kind of liver disease she had. A friend of mine had a liver disease when he was in his 20s. It didn’t kill him until he was around 50.
I don’t think this was a high cost school.
25k a year? If includes tuition, room and board sounds about right.
Same here. Learned that lesson the hard way. I’ve worked way too hard to allow someone else to screw up the credit rating I’ve earned.
After your mention of other articles, I did a search and indeed there are several with additional information.
Here is one:
“Originally for $100,000, the total due increased to $200,000 due to late fees and a hefty 12% interest rate.”
Why would they take out a loan at that huge interest rate?!
“We knew if she didn’t pay her debt we would be responsible by co-signing, but we didn’t know that if she died the debt would fall to us,” he said.
Life is hard. It’s harder when you’re stupid.
Got me….maybe they didn’t shop.
As usual, the dailymail has lots of details.
Sounds like she got new loans as she went along with her education. The article says some of the lenders have been working with them, some aren’t.
Well, for one thing they didn’t expect that their daughter would die in her twenties. No one does.
Any time I’ve bought something expensive on credit (house, car, etc) I’ve opted for the insurance to pay off in the event of death. Then again, I’ve worked casualty so I’m under no illusions of immortality.
Apparently the banks considered her a high risk borrower, in a CNN article it said she was paying 12% interest rate and the parents weren’t making payments for some time, that’s how $100K grew to $200K — apparently the loans were taken out years ago and she died some four years ago.
Sad, but that’s why people need to think of the worst that can happen and take that into account, when making decisions.
Ditto.
“I have family members who are nurses and there ain’t no way they paid 100,000 dollars for their education.”
That is what I was thinking how could someone pay 100k for nursing school. Was she at Harvard.
The problem is that the people offering the loans are predatory lender, but more of a problem are the kids who use these loans for all sorts of things other than books, tuition and basics. They go out and party on the money by expensive toys and live in the fantasy world that the bill won't come due.
“What kind of interest rate are they charging for the student loans if they double in four years?”
According to the Rule of 72, the interest rate would be 18%.
I thought if it was in the dead spouse’s name only, the surviving spouse is not obligated to pay. If they left an estate, it comes out of the estate. But if not, I don’t think the spouse has to pay. Though the credit companies will try, very hard. It may depend on state laws.
12%???? wow! that sure ain’t your typical student loan rate!
They Co signed the loan. If the party defaults, sadly in this case by dying, they are still responsible.
Never, never, never, never co-sign ANY type of loan. The requirement for a co-signer is just the lender telling the borrowers up front that they already know that they will be collecting from the co-signers. People would be better off to take the loan directly and then personally collect from the other party....at least then you get to avoid the shock of the inevitable.
If you are currently in a situation where you have co-signed, you should immediately purchase a term life insurance policy on the party that was the 1st borrower.
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