Student loan hell

[JustRalph]

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=439x81251

noticed this thread at DU

Been reading about this problem growing for the last few years.

I actually think this person in the thread is in the lower end of what most owe

[Dave Schwartz]

The system is actually much worse than that.

A very good friend of mine from years ago married his wife just after graduation. About 7 or 8 years into their marriage she was dunned for a student loan of about $1,000 that had grown with interest and non-payment to about $3,000.

She contacted the collection agency for the loan and told them that she remembered this load; that she had applied for it but never actually taken the funds.

The collector said that was not HIS problem. He had purchased a loan for good money and she was going to pay. When she asked him to produce proof that she had ever actually received the money he said he did not have to.

To make a long story short, ultimately the bureaucrats agreed with the collection agency, saying it was her responsibility to "keep her receipts." When she said, "Why would I have a receipt for money I didn't receive," the agency said, "That's not our job. The school must have lost it."

Eventually, when it got to about $5k, they settled for half.

[boxcar]

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=439x81251

noticed this thread at DU

Been reading about this problem growing for the last few years.

I actually think this person in the thread is in the lower end of what most owe

That guy is peeved big time at the "banks". But I thought the government took over the student loan biz?

Regardless, I've never seen the wisdom in a young person mortgaging off his future. Either work you way through school, or work and save every dime now for future enrollment in a school. Of course, the third option would be for parents to open up a education trust fund very early in their kid's life. Any one of these options are far superior to going into debt -- most espcially now if that debt is owed to the federal government.

Boxcar

[ArlJim78]

Education is the biggest racket around.

[redshift1]

I was thirty when I finally paid off my student loans and that was before school costs exploded.

[Saratoga_Mike]

The system is actually much worse than that.

A very good friend of mine from years ago married his wife just after graduation. About 7 or 8 years into their marriage she was dunned for a student loan of about $1,000 that had grown with interest and non-payment to about $3,000.

She contacted the collection agency for the loan and told them that she remembered this load; that she had applied for it but never actually taken the funds.

Eventually, when it got to about $5k, they settled for half.

Someone paid $2,500 on a loan they never received?

[Tom]

I told my banker that I posted here and suggested he read my some of posts.
Two days later, he refunded my college loans. :p

[Valuist]

Someone paid $2,500 on a loan they never received?

Probably less than what the legal costs would be to defend it.

[GameTheory]

She could have just ignored it with no consequence. After that period of non-payment, it was written off as a loss already by the original creditor and past the statute of limitations for her to actually still owe it. (And likely not on her credit report.) Only by acknowledging that she had a debt was it back on the books and her credit report.

[Dave Schwartz]

Someone paid $2,500 on a loan they never received?

That's what I asked, but, yes.

[GameTheory]

Actually, what I said might not be true if it was a government-backed loan (but then it would have been the government calling, at least eventually). But for a private debt, credit-card etc -- those things expire (time varies by state).

And usually someone would have to provide proof of debt if you demand it (which you shouldn't if it has been long enough -- you should simply not talk to them, because acknowledging the debt can "re-activate" it.) It is quite possible she did "receive" the money -- most student loans go straight to the registrar's office, although sometimes you have to at least sign the check or something. Still, certainly possible the school was paid in her name -- the school owes her money, and they most surely would have a record of it...

[Saratoga_Mike]

That's what I asked, but, yes.

I think you lent them $10k a few yrs ago, too, no? See if you can settle for $5k!

[Dave Schwartz]

That Mike, always thinking...

[Rookies]

I told my banker that I posted here and suggested he read my some of posts.
Two days later, he refunded my college loans. :p

Should have waited 4 more days to be the clear leader for Humour Post of 2011! :lol: :lol: :lol: :D :D :D

[delayjf]

you should simply not talk to them, because acknowledging the debt can "re-activate" it.)

Are you refering to the stature of limitations on the collection of the debt

or

the amount of time a negitive comment can remain on your credit report?

The reason I ask is - working next to a lawyer who showed me that the only way to re-toll a bad debt on ones credit report was to bring the debt current then fall behind in the payments again.

When she asked him to produce proof that she had ever actually received the money he said he did not have to.

BS - by law they have to verify the debt upon request.

[GameTheory]

The reason I ask is - working next to a lawyer who showed me that the only way to re-toll a bad debt on ones credit report was to bring the debt current then fall behind in the payments again.It was my understanding that if, for instance, you had a debt that was 15 years old -- long gone, written off, not on your credit, etc, BUT you still get letters or calls from whatever agency bought it for pennies on the dollar and you actually paid them anything, the debt would now reappear on your report (possibly, if the agency reports it). Even if you paid in full it shows as paid very very late (or at least very old) so it is better for it not to be there at all. And I've also heard just acknowledging who you are, the debt is/was yours, or asking them to prove you owed it, etc could possibly bring it back to life. Not sure where the exact line is. In other words, if it is dead, don't touch it. Of course if you are more recently delinquent, you are probably better off finding a way to pay it off, get on a payment plan or whatever. But if it is off the books, nothing good can come from even talking to the collection agency people.

None of this applies to the government, of course. They will never stop.

[TJDave]

It was my understanding that if, for instance, you had a debt that was 15 years old -- long gone, written off, not on your credit, etc, BUT you still get letters or calls from whatever agency bought it for pennies on the dollar and you actually paid them anything, the debt would now reappear on your report (possibly, if the agency reports it). Even if you paid in full it shows as paid very very late (or at least very old) so it is better for it not to be there at all. And I've also heard just acknowledging who you are, the debt is/was yours, or asking them to prove you owed it, etc could possibly bring it back to life. Not sure where the exact line is. In other words, if it is dead, don't touch it. Of course if you are more recently delinquent, you are probably better off finding a way to pay it off, get on a payment plan or whatever. But if it is off the books, nothing good can come from even talking to the collection agency people.

None of this applies to the government, of course. They will never stop.

We ARE talking about a contested debt...One you honestly believe you don't owe, right?

[GameTheory]

We ARE talking about a contested debt...One you honestly believe you don't owe, right?No, a real debt, but it doesn't really matter. Let's say you had a credit card you defaulted on 15 years ago -- just stopped paying it. The credit card company probably wrote it off after a year or two (counted it as a loss and so it is "off the books"). It was given to some first-tier collection agency during that time (an agency that actually works with the creditor so if you had paid then they would have gotten most of the money). Much time passes -- it has dropped off your credit report (after 7 years) and the statue of limitations has expired. You do not legally owe this debt. (You may even have a new account with the same credit card company now -- it is truly gone and forgotten as far as they are concerned.) Nevertheless, it has been passed around, sold from one collection agency to another (another with a gazillion debts of other people) for pennies on the dollar or hundreds of pennies on the dollar.

Now some dude is calling you for payment. He will offer you settlements, etc, but really he has no legal standing to actually threaten bad consequences for non-payment because the debt has legally expired. (But he will anyway if you talk to him.) The amounts discussed will be totally arbitrary -- he just wants to convince you to pay him something, anything.

If you pay it, the guy makes a commission and his company gets the rest. Does the original creditor that you actually owed get anything? No. And if you pay it, it will likely actually make your credit report WORSE, not better. Is it the "honest" thing to do because you did owe it once? Hard to make that argument either, since the system has already forgiven your debt long ago even if you still feel guilty about not paying it. We've only got this parasite left, ready to take your money that you no longer legally owe anybody. Can't see the point of paying him, moral or otherwise. Just put it in the past and move on.

[skate]

Education is the biggest racket around.


:ThmbUp:

Tennis anyone?

[skate]

No, a real debt, but it doesn't really matter. Nevertheless, it has been passed around, sold from one collection agency to another (another with a gazillion debts of other people) for pennies on the dollar or hundreds of pennies on the dollar.

Now some dude is calling you for payment. He will offer you settlements, etc, but really he has no legal standing to actually threaten bad consequences for non-payment because the debt has legally expired. (But he will anyway if you talk to him.) The amounts discussed will be totally arbitrary -- he just wants to convince you to pay him something, anything.

If you pay it, the guy makes a commission and his company gets the rest. Hard to make that argument either, since the system has already forgiven your debt long ago even if you still feel guilty about not paying it. We've only got this parasite left, ready to take your money that you no longer legally owe anybody. Can't see the point of paying him, moral or otherwise. Just put it in the past and move on.

Right on the money, good call Theory.

[The Judge]

in some states if you make a payment on a loan after the statue of limitations has run, it starts a new agreement. So any type of small monthly payment arrangement is BAD.

If for some reason you do decide to pay make sure you get a "release", you would be surprised how often these "paid off loans" come back around for a second visit.

Some people have to pay loans they are not legally obligated to pay in order to clear their record so that they can make a major purchase such as a home and they just have no time to fight. Sometimes money to pay off the debt can be left in escrow until its cleared other times it can be a deal buster so it has to paid if its small enough.

In most states they have to produce the original loan with your signature. There is tons of info on the internet for free on step by step methods to deal with unlawful collections no need to pay for advice.

[JustRalph]

Back to the original topic

http://www.examiner.com/finance-examiner-in-national/the-college-eduction-scam-the-student-loan-bubble-and-a-lifetime-of-debt

Saw this piece today. Some of those 16 items surprised me

The one comparing credit card debt was very surprising to me

With all the moaning about medical costs, funny nobody noticed education costs going up twice as much

[delayjf]

As I research on the internet the issue of how long a negative report can stay on your credit report - I've discovered there seems to be a lot of confusion. So I went to several legal sites and this is what I've found.

As far as credit card / loan debt is concerned. A negative credit report can only stay one's credit report for 7 and 1/2 years. (according to the FRCA, the seven year period starts 180 days after the initial delinquency date) the 7 year clock cannot be turned back by a payment, or by a Collection agency that purchases the debt. However, what collection agency's sometimes do is list the debt with the credit reporting bureaus, even though it’s older than 7 years, hoping the listing will intimidate you into making a payment. If that happens it is up to you to ask the credit bureaus to remove the outdated report. My guess is that it’s also a good idea to ask the collection agency to remove their negative report as well. If they don't and you incur a loss of some kind i.e. turned down for a home loan, you can sue them for deformation.

Here's a good link that covers both the negative report reporting limitations as well as the SOL for collections in each state.
http://www.cardreport.com/credit-problems/time.html

[highnote]

With all the moaning about medical costs, funny nobody noticed education costs going up twice as much

I've noticed. With two kids planning on going to college someday tuition costs is something I keep an eye on.

It can cost $50K plus per year!!!!!

I think that student bank loans has driven up education costs just like mortgage loans drove up real estate prices. There will probably be a crash in education prices, too. If no one can afford to go to college costs will have to come down.

[boxcar]

Back to the original topic

http://www.examiner.com/finance-examiner-in-national/the-college-eduction-scam-the-student-loan-bubble-and-a-lifetime-of-debt

Saw this piece today. Some of those 16 items surprised me

The one comparing credit card debt was very surprising to me

With all the moaning about medical costs, funny nobody noticed education costs going up twice as much

As usual Big Gov is a huge part of the problem. Just about anything the government touches turns to pig poop. And Big Ed, which is loaded, generally, with liberal faculties is scamming the "little guy" -- the average student who borrows or pays all this money or goes into deep debt thinking they're going to get a decent education at the end of the road. These liberal bastions in the educational system are essentially cheating these kids and, in many cases, robbing them of any real opportunities for a prosperous future.

I'd be curious to know what a totally private college like Hillsdale charges for tuition every year.

Boxcar

[GameTheory]

As usual Big Gov is a huge part of the problem. Just about anything the government touches turns to pig poop. And Big Ed, which is loaded, generally, with liberal faculties is scamming the "little guy" -- the average student who borrows or pays all this money or goes into deep debt thinking they're going to get a decent education at the end of the road. These liberal bastions in the educational system are essentially cheating these kids and, in many cases, robbing them of any real opportunities for a prosperous future.

I'd be curious to know what a totally private college like Hillsdale charges for tuition every year.

BoxcarPrivate schools are even more, generally. Of course there are scholarships, etc. I heard Hillsdale is about 20K/yr currently -- that's tuition only.

[boxcar]

Here is some info I got off the Hillsdale site. Keep in mind that this college doesn't take a dime in government money.

* Admissions
o Q: What is your tuition at Hillsdale?
o A: Tuition for 2010-11 is $19,960. The annual cost is $28,490 which includes tuition, room, board, and general fees. Books and course fees are additional expenses.

http://www.hillsdale.edu/admissions/faq/faq_search.asp?iSectionID=1

Boxcar

[boxcar]

Private schools are even more, generally. Of course there are scholarships, etc. I heard Hillsdale is about 20K/yr currently -- that's tuition only.

Well, according to the link JR posted to the Examiner, I'd say 20K is a bargain!

This is why college tuitions at many institutions now are $30,000 to $50,000 per year, not even counting living expenses.

Boxcar

[GameTheory]

I went to Ithaca College from 1988-1992, which is private. I think it was about 10k at the time, and most state schools were around 4-6k, and could be significantly less for home-state students.

Really you're better off at a community college these days, except for certain professions where the "brand-name" of your school is really going to pay off.

Harvard's endowment is so large they could give free tuition to all their students without blinking. Don't think they will though...

[johnhannibalsmith]

I wasted a year of my life (well...) accruing an $8,000 student loan that stands as the only beckoning monthly debt that I haven't vanquished. I paid a hefty monthly load for a couple of years when I was working right after I left school. I then went into forebearance for a year, then ultimately defaulted when I moved and couldn't come close to making the monthly payment. After two years of being unable to come to an agreement on monthly payments which resulted in no payment - I began paying again at a reasonable monthly payment.

In other words, despite recognizing my own measure of irresponsibilty through some of that time, I've been paying for quite a bit longer than I have not been paying since I started repayment. I now owe about 20% more than the original loan amount - even after years, years, years, and more years of payment compared to a bad spell of a couple when I did not.

The worst part of it all is that I hate to play this angle, but at 16, when I had to fill out all of this garbage... I gotta claim some serious memory loss here when I try to remember actually realizing what the hell I was getting into. Simple truth was that I picked the school that was closest to my girlfriend. I signed where I had to and money and tuition and loans was the farthest thing from my mind. I had to be hotshot to even fill out any applications.

I always try to steer all young people away from the mistake of education.

[Tom]

Community college s taught by those who are doing it.
Too many "professors" have no clue what the real world is like.

[delayjf]

Really you're better off at a community college these days, except for certain professions where the "brand-name" of your school is really going to pay off.

That has become the new paradiam, most students are going to community colleges for their first 2 years then transferring to a four year school. My first semester at Nebraska, tuition was 19.00 a credit.