New Book 'The Student Loan Scam:' By Michael Collinge & Website StudentLoanJustice.org

[1776Forever]

Thanks to DUer chaska who told me about this!

Background: I was told that my entire Social Security Check of $674 was going to be taken for my Student Loan payments. I found this website after chaska told me about the new book by Michael Collinge "The Student Loan Scam":

StudentLoanJustice.org

Here is a snip from their site:

In 1997, under intense lobbying from student loan companies, the Higher Education Act (HEA) was amended.

Read more here:

http://www.studentloanjustice.org/problem.htm

The site takes personal stories and is trying to get people organized in different States to fight back. We are filing bankruptcy because of helping a family member for 2 years that needed help after they developed Progressive MS and had no insurance but we cannot take the Student Loans off because of the amendment to the HEA. I hope if you have a story to tell you will go on the .org site and tell it and get involved. You could be next!

:fistbump:

[FirstLight]

1. Bookmarking for SURE!

My loan is in default for a few reasons, one of which I cannot believe there is not a form or SOME way i can file for any grace period..

all i can do is struggle to make enough money to pay it back someday...and i still don't even have a bachelor's degree!

[JDPriestly]

2. This is outrageous, and Congress and the president need to bail out students

caught with outrageous loans and no jobs.

If Congress and the president can bail out the banks, they should certainly bail out those who cannot pay on their student loans. We tell kids that they need an education and encourage them to take the loans. They then become indentured servants because the loans cannot be forgiven. The only way to end your debt is to die. That is outrageous. The contracts for those loans are, in my view, unconscionable.

[1776Forever]

4. You got that right - that's what I told the guy today from the loan company!

When I die I might have a few bucks after they cremate me! I wanted to pay a % of my little monthly check but he told me "No, you must pay the entire amount." Right - This is just rediculous! I know I am not the only one! I feel like the Millionaires that lost their millions to Maddof - only I am loosing my little $$ to the government store!

[ihavenobias]

17. Amen and K & R n/t

[closeupready]

20. You know, it just occurred to me - these contracts might even be unconstitutional.

That is, you are correct when you say that the loans only expire upon your death, and continue collecting interest until paid off. That certainly IS de facto indentured servitude.

Has anyone sued the government on grounds that such provisions are unconstitutional?

[JDPriestly]

21. Wikipedia defines indentured servitude as

The laborer is under contract of an employer for some period of time, usually three to seven years, in exchange for their transportation, food, drink, clothing, lodging and other necessities. Unlike a slave, an indentured servant is required to work only for a limited term specified in a signed contract.

http://en.wikipedia.org/wiki/Indentured_servants

Since the contract is not with the employer, technically, the loans aren't actually indentured servitude. It's the modern day equivalent. Actually, if the lender would guarantee the borrower employment that would enable the borrower to pay the debt within a definite period of time, it might be better.

[Waiting For Everyman]

3. These student loans need a bright light on them - it's indentured servitude again.

The whole program is ridiculous. Very little of the cost ends up being deductible off of taxes, which is absurd. So are the terms. And BK should wipe out everything... that's the point of it. It's either justified or it isn't, and if it's justified all debts should go away. Also, no government check should be seizable by these vultures.

Thanks for the link!

[1776Forever]

5. Thanks! I feel like that old song - 16 Tons

You load sixteen tons, and what do you get?
Another day older and deeper in debt.
Saint Peter, don't you call me, 'cause I can't go;
I owe my soul to the company store...

Johnny Cash - Sixteen Tons on YouTube

http://www.youtube.com/watch?v=boXa8c6OuRQ

[ThomCat]

7. You are right, and I think that has been the deliberate point of it.

Too many poor people were succeeding and getting "above themselves" so a way needed to be created to keep them down. The student loan scam was a way to keep poor people from ever really succeeding. :(

[EFerrari]

6. Have you tried to call that social worker yet?

[1776Forever]

8. I am going to call them tomorrow. Thanks!

But from what I saw on the StudentLoanJustice.org site it says they can do it:

http://www.studentloanjustice.org/pac.htm


The Student Loan Justice PAC was formed in December, 2006. The PAC provides a counterweight to the big lenders in Congress, who regularly donate millions of dollars every election cycle to our elected officials. With the new Congress, we have a unique opportunity to get real justice- for the first time in years- for our loans. The Student Loan Justice PAC will be an instrumental element in this fight, but only with your support. Our agenda is as follows:

1. Pass legislation that returns standard consumer protections, including full bankruptcy protections, statutes of limitations, and refinancing rights to all student loans- both public, and private.

2. Pass legislation that allows borrowers in default for 5 years or more to repay what they originally borrowed, plus a reasonable amount of interest OR repay the amount that the federal government paid for the loan guaranty on the loans (this typically includes principle, interest, and a large profit for the lenders).

3. End the Department of Education practice of Disability and Social Security garnishment, and end the practice of suspending professonal licenses of citizens for defaulted student loan debt.

4. Increase federal grants for education, and expand tax benefits for repayment.

:hi:

[AtomicKitten]

9. Emailed this to my son.

He was bamboozled into taking out pricey loans from the Art Institute here in SF. Turns out he was/is eligible for low cost federal loans but they never applied and, in fact, steered him away from them.

Thanks for posting this.

[1776Forever]

10. Update: There is a google group and facebook website for the new book.......

Google Group:

http://groups.google.com/group/studentloanjustice?msg=subscribe&hl=en

facebook main group:

http://www.facebook.com/group.php?gid=7704336701

I am just learning about all this. Hope this helps us all!

[AtomicKitten]

11. wow, thanks so much for the info ;)

[readmoreoften]

12. I can add the horror stories of me and mine to the list now. Thanks.

And I mean "lives destroyed" horror stories.

[1776Forever]

15. Hope you check out the website and the google group - Together we can make a difference!

:fistbump:

[Divine Discontent]

13. Good Lord help us! That's HORRIBLE! These bastards have got full control of everything.

We need to push a congressperson or Senator to put forth legislation to protect the SS checks so that a portion can be paid, not the entire check!

This is absurd. The banks have full control this way, and that's not cool.

I know that every tax rebate I get goes FULLY for mine. That's not as bad as your situation - but it proves they're going to take 100% of whatever they can control, instead of saying $50 a month.

K&R, and I'd seek out a meeting with your congressman, even though he's a 3rd year congressman, maybe he can bring it up to others, or contact the very liberal Democratic Senator there!

[1776Forever]

14. I am going to contact my Congressman tomorrow.

Thanks!:fistbump:

[cherishdestiny]

16. it's legalized slavery of the poor & disabled...

Hi there. I'm disabled and receive SSDI. I've been fighting with the Department of Ed and other entities over my student loans for what at least feels like a very long time (I graduated in 1992). The unethical behaviors that are perfectly LEGAL is just mind blowing. The start of my battle was a "customer service rep" deciding all on his own that I "could" pay my loans had I wanted to (despite my explaining in I don't know how many ways that at the time it was my spouse, myself and his two children trying to survive on his workman's comp and my state disability payments) so he called my Dad who was NOT in any way a party to the loan beyond a skip trace contact and made a "payment arrangement" that DOUBLED my payments which I was then expected to follow. When I refused to follow said "arrangement" they put me directly into default. My loan changed hands many times and no one ever knew to whom my loan had been sent nor could they tell me anything more helpful than "eventually the new holder will contact you to resume payments". Finally the Department of ED - which supposedly has access to most standard government databases and is supposed to use at least the mailing address databases of organizations like the IRS and SSA - received my loan and "couldn't find me" despite the fact I'd had repeated security clearances having worked with government agencies and later needed DOJ clearances for schools then finally ending up on SSDI so that the SSA always had my current contact info down to phone number. But what does the Department of Ed do? They mailed the "notice" they were about to garnish my SSDI to a mailing address that by the time of mailing was YEARS out of date. That's right, YEARS. I didn't receive the notice, but since they could prove they'd MAILED it - they'd met all legal obligations and could still garnish up to 15% of my SSDI toward paying off my defaulted student loans. Why they're bothering I don't understand - even if they hadn't "been nice" and negotiated to a smaller payment due to hardship (of course being on SSDI, I'm living below the poverty line) the 15% amount paired with how they figure interest and apply payments would never pay off the loans in my lifetime.

This means that on top of not being legally bound by standard business ethics, they're not even limited by the sorts of limits placed upon the IRS and collection of child support. Now seriously, are we all supposed to believe that student loans are a bigger risk to the nation than unpaid taxes or unpaid child support? Based on how they're collected, one would be lead to think so.

What's worse, is that the definition of disabled is so vague that the only way to be certain one meets it is to be dead. Technically, if one were ever to make and sell trash art for pennies or do piece work assembly for similar income - even for a few hours per year just one year - one would be WORKING in the eyes of the Department of Ed and thus not eligible for loan forgiveness due to disability.

Ultimately, had I had the slightest inkling what I was truly getting into when I signed the loan papers, I would NOT have taken the loans. There was nothing in the papers indicating that they could follow me for the rest of my life and use the ethics of a back alley loan shark to collect. A college education that MIGHT lead to a better income and an escape from my home town wasn't worth that sort of risk. NOTHING is worth that sort of risk. We need to return some reasonable protections to student loans - and backdate the protections so that they cover all loans still in existence and ideally we need to return student aid back to being primarily sources that are NOT loans. Loans aren't aid, they're a trap.

[Divine Discontent]

22. sorry for what you're dealing with. That last paragraph was great! Bless you. eom

[1776Forever]

25. Have you checked out the ombudsman site? I just sent them an email request. Here is the site link.

https://ombudsman.ed.gov/index.html

Thanks to Tansy_Gold!

Here is the info from this site: http://www.consumerlaw.org/initiatives/seniors_initiative/ss_benefits.shtml

Example 3: You receive $700 each month from Social Security. This is less than $750 and therefore nothing will be taken.

Can They Take My Entire Monthly Check?

No. There are two important limits:

* The first $9,000 or $750/month of benefits are safe.
* No matter how much money you get, the government will not take more than 15% of your benefit.

..........

I did find the website info incorrect - here is the right link info:

The ombudsman's web site is http://www.fsahelp.ed.gov/about/sitemap.html

The toll-free phone number is 1-877-557-2575

And there is an email service at https://ombudsman.ed.gov/OmbudsmanWebApp/do?action=getRequest

Hope this helps!

Hugs :pals:

[ChromeFoundry]

18. K&R n/t

[Tansy_Gold]

19. They can't take your whole check. Don't panic

PLEASE -- do a little research.

http://www.consumerlaw.org/initiatives/seniors_initiative/ss_benefits.shtml

Here's just one site out of many.

Summary:

SSI benefits are exempt.
First $750/month is exempt. IOW, if your SS check is $674/month, they can't take any of it.
They can only take a MAXIMUM of 15% of your SS benefit.



Yes, the loan companies and the whole Sallie Mae structure need to be overhauled, but don't panic yet.


TG

[1776Forever]

23. Thanks for your time - I do fall under the Example 3 limit so I will check this out more......

http://www.consumerlaw.org/initiatives/seniors_initiative/ss_benefits.shtml

Example 3: You receive $700 each month from Social Security. This is less than $750 and therefore nothing will be taken.

Can They Take My Entire Monthly Check?

No. There are two important limits:

* The first $9,000 or $750/month of benefits are safe.
* No matter how much money you get, the government will not take more than 15% of your benefit.

..........

Thank you so much - now more calls to be made.

I did find the website info incorrect - here is the right link info:

The ombudsman's web site is http://www.fsahelp.ed.gov/about/sitemap.html

The toll-free phone number is 1-877-557-2575

And there is an email service at https://ombudsman.ed.gov/OmbudsmanWebApp/do?action=getRequest

Advocates seeking more information can call the National Consumer Law Center at [phone].

Hugs to you for your help!
:pals:

[cherishdestiny]

28. GRrrrrrrrrrrrrrrrrrr

OOOOOOOOOOO I am sooooo mad after reading that info. I was told REPEATEDLY - by the Dept. of Ed, mind you - that there IS no exemption, only that limit. The Dept. of Ed was quite insistent that they can take 15% of my ENTIRE SSDI check, no matter what the amount and that it's only due to their "kindness and generosity" that they will "sometimes adjust for hardships". (Just for the record, my SSDI is a bit over $12K/year). This tells me that even the Dept. of Ed misfigures their take - and based on convos with them, I'd bet they're doing it intentionally.

They literally told me I should be "grateful for their kindness" when they cut my offset down to $35/mo. And they broke a half dozen or so of the rules laid out by that site.

Now who can fight this? Do I need a federal attorney?

[1776Forever]

29. I am starting with the Ombudsman and the Google group I joined.

The group StudentLoanJustice is really wonderful and I suggest you join.

http://groups.google.com/group/studentloanjustice/browse_thread/thread/f153f9b1d2fcd046?hl=en

As far as who you will need to fight this I would double check with the Ombudsman like I have to see what they tell you. Hopefully you will get the correct information. I will let you know what I hear back from them too.

:hi:

[malaise]

24. John Boehner!!!

http://www.realclearpolitics.com/Commentary/com-1_11_06_FH.html

Time to make him cry!!!
Send this stuff to Bill Moyers, KO and Rachel right fugging now!!!

[1776Forever]

26. Thank you for the post - I try not to hate anyone but Boehner is a creep in more ways then one!

Wow -

January 11, 2006
Sallie Mae's Sweet Romance with Rep. John Boehner
By Froma Harrop

http://www.realclearpolitics.com/Commentary/com-1_11_06_FH.html

Let's talk about Boehner and the financing of campaigns -- specifically, his. Boehner raised $172,000 from student-loan companies during 2003 and 2004. What made him worthy of that healthy sum?

The answer can be found -- but not easily -- in the budget reconciliation bill now awaiting final approval from Congress.

Chairman of the Education and Workforce Committee, Boehner had orders to find $13 billion in cuts from the student-loan program. The bankers were initially worried, but Boehner reassured them. "Know that I have all of you in my trusted hands," he told the annual meeting of the Consumer Bankers Association, adding, "I've got enough rabbits up my sleeve."

:argh:

[malaise]

27. I found it at your link

Lots of goodies at links.