Posted on 09/09/2012 6:47:49 AM PDT by Uncle Chip
At a protest last year at New York University, students called attention to their mounting debt by wearing T-shirts with the amount they owed scribbled across the front $90,000, $75,000, $20,000.
I couldnt believe the accumulated wealth they represent for our industry, the consultant, Jerry Ashton, wrote in a column for a trade publication, InsideARM.com. It was lip-smacking.
Though Mr. Ashton says his column was meant to be ironic, it nonetheless highlighted undeniable truths: many borrowers are struggling to pay off their student loans, and the debt collection industry is cashing in.
As the number of people taking out government-backed student loans has exploded, so has the number who have fallen at least 12 months behind in making payments about 5.9 million people nationwide, up about a third in the last five years.
In all, nearly one in every six borrowers with a loan balance is in default. The amount of defaulted loans $76 billion is greater than the yearly tuition bill for all students at public two- and four-year colleges and universities, according to a survey of state education officials.
To get the money back, the Department of Education last fiscal year paid more than $1.4 billion to collection agencies and other groups to hunt down defaulters.
Hiding from the government is not easy.
(Excerpt) Read more at nytimes.com ...
Yep - I had one based in Texas trying to collect on a medical bill I had paid when I got the bill. They kept coming back with stronger warnings until I sent both them and the medical folks they represent a registered letter telling them that if this continued, or if my credit rating took a hit because they couldn't get their $hit straight, the next missive would be from my lawyer and the instructions for my lawyer would be to collect as much money as humanly possible.
That is possibly a case of stolen identity. I would recommend checking with one of the several accredited websites that help folks determine if they are victims of identity theft or not. This might only seem like an inconvenience right now, but what if this person jumps bail on some felony charges under your name, or if they get into your 401K account and cash it out.
“WTF where these idiot losers thinking?”
You’ve hit upon the crux of the issue.
I’m more worried about Ms. Cordeiro putting junior in the back seat of her (expensive-looking) vehicle than about whether she’s a deadbeat. I guess no one ever told her how easy it is to forget about a kid back there (particularly if a debt collector calls), and thus put him at great risk, particularly in the summer.
Tragic.
Being limited to the 1st 2 years of post secondary "Higher Learning" costs, it served the purpose of luring in marginal students to 'try out' for those high-paying college graduate jobs. It could not be used for technical or direct skills training courses. Thus students (or parents) are encouraged into "Higher Learning" but with little regard as to what the end expense may be.
Strange thing about "Higher Learning" costs in the past several decades, no matter what the inflation rate or cost of living indexes may show, the tuition/residence/materials cost goes up. In the 1986-2011 time frame, the CPI went up 115% while Tuition went up 498%. Add to this is the fact that the "Higher Learning" employed financial advisors are there to KEEP THE SEATS FILLED and not for the financial benefit of the student.
Is "Higher Learning" a racket? /sarcasm
Is College a liberal stalking horse to destroy our culture? /sarcasm
What happened to her child?
“By the time the government caught up with him, Mr. Chaskin owed more than $19,000 in accumulated interest and penalties, but the judge reduced the amount to $8,200 after Mr. Chaskin pleaded for a break.”
He should have to pay it all back, especially since he had $20k to play with in a brokerage account. Other than that, people (parents and kids) are learning serious lessons about taking money that is offered to you as a loan.
And remember, as bad as the tactics sound here, try borrowing from a shark (like my neighbor did a long time ago), their ways of dealing with deadbeats are a bit more, how do you say, effective (although in his case, he paid it back per plan).
Apparently you missed my /s.
there is regulation. Enforcement is a joke. collectors know they can get away with everything because their targets have no money and are a low priority when violations are reported.
nobody cares.
Even setting the “basketweaving” PhDs aside, consider how many people we all know (including sometimes, ourselves) who are or were employed in a field almost completely unrelated to their undergraduate majors. In the days of “liberal arts education”, it was not unusual for the biology major to end up running a bank, under the theory that a four-year degree taught critical thinking and analytical skills that were transferrable beyond one’s area of major study. Even if, in today’s much constricted jobs economy, that is still somewhat true, it’s a very expensive gamble for an uncertain outcome.
And, what happens to the lifetime earnings, not to mention the student loan repayment timetable, when you allow for the years living in mom’s basement and/or the years working below one’s potential (underemployed)?
No one needs to accrue $90K in loans. If you can’t afford a big-name school, don’t go there. Go to community college and a state school. For most jobs, once you’re out in the workforce, nobody really cares where you went to college.
No, I saw your /s. ;-)
I was just looking for a somewhat relevant post to respond to. I’m always surprised when I see anyone funding a graduate degree with student loans. (obviously there are exceptions)
“Nevermind I thought you meant the author.It’s the law to put them in the back seat at that age.”
Sometimes we simply have to get tinted windows and ignore “the law”, as it’s now obsolete with air bags that don’t deploy when there’s a kid in the front (via weight sensors in the seats). I know others think they’re perfect, but I’m not, so I actually (or read did) worry about leaving my kid(s) in the back seat, especially here in Houston.
“This was all calculated and expected, I assure you. The Obama regime WANTS debt slaves.”
Uh it was under Dumbo Dubya’s reign of error (with a GOP controlled Congress) in 2005 that the inability to discharge student loans was put in place.
http://www.gpo.gov/fdsys/pkg/PLAW-109publ8/html/PLAW-109publ8.htm
Plenty of us small government conservatives on FR warned that it was a terrible idea for a very simple reason - for every dollar that had to be paid to some debt collector was a dollar that couldn’t be spent to help the economy. Looks like we were proven right again.
Oh,that’s a worry.I didn’t know about the weight sensors .
I’m actually one of the guys making good on my old student loan. About time I made that amend.
I had something similar happen. I thought I put a stop to the phones calls after I managed to talk to a real person at the dept collection agency and telling them I had no idea who they were looking for. About 6 months later I started getting phone calls for the same unknown person. They even called my parents in an another city looking for this person. Unbelievable. The calls eventually went way when I was home during the workday and answered the phone.
I am guessing these dept collection firms buy, sell and trade cases and start from scratch each time..
I am speaking of degrees which get you no where and no job.....except of course, in government.
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