Change.org Petitions

[M GO BLUE!!!]

Anybody else get these & sign some? I find some are things I easily stand behind. Others...

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http://www.change.org/petitions/national-collegiate-trust-american-education-services-forgive-my-deceased-son-s-student-loan

My name is Ella Edwards. My only son, Jermaine Edwards, was a wonderful young man and the light of my life. When he went to college to study music production, I was happy to cosign his student loans -- he dreamt of making a better life for himself and I wanted to help him do that. But then Jermaine died suddenly in 2009 at just 24 years old. That's when American Education Services (AES) and National Collegiate Trust (NCT) turned my son's dream into a nightmare for me and the two year old son he left behind.

Jermaine had three student loans when he passed -- two from the federal government, and one private loan. The federal loans were forgiven within a month of his death. But AES is refusing to forgive the loan.

Jermaine was my only child, and after his death, I was so devastated I could barely get out of bed in the morning. I requested an early retirement from my job, losing much needed retirement benefits. Since my son's death, I have been under doctors care. I am 61 years old and I have been trying to work to make Jermaine's loan payments. I am trying to pay off Jermaine's loan, but I simply don't have the money -- and because of my crushing depression, I am barely able to work at all. To make matters worse, Jermaine left behind a young son whose mother doesn't have many resources. Therefore, she relies on me to help support Jermaine's son.

Nobody told me when i cosigned the loan that I would be forced to pay them back even if my son died. Jermaine never had an opportunity to use his education and I can't use it either. I need help to get this loan forgiven and to change policies that will protect students and parents after the death of a student.

This one I am torn a bit on. I understand where the mother is coming from and feel for her, but when you cosign a loan it doesn't matter what the circumstances are. You backed that loan up. I think she is fortunate the government forgave the loans. I also wonder if she had life insurance on him. That could have been used to pay off the loan.

It's a sad situation, but she did co-sign.

[molson]

I feel bad for her, but I'd feel more bad for if she could admit she made a mistake and not just blame the loan providers.

My niece went around this year and tried to get a bunch of family members to co-sign for her loans. No dice. Too risky.

There's plenty of sad stories about well-meaning people who make various financial mistakes. Those situations always make think of people like my niece, who either played it safe or were forced to play it safe. Those "victims" who find themselves in bad situations are only victims because their gamble didn't pay off. If they were luckier and things went they way they hoped, they would be in a much better position than people like my niece. And the entire reason they'd be in a better position would be because they were willing to take on risk. And sometimes, risks don't pay off, that's the point.

If you bought a house you can no longer afford I'll feel bad you, but I wouldn't consider you a victim for the same reason. You took a risk in order to give yourself a chance to be in a better position than the person who was more conservative or saved more money. If it wasn't for the risk, you wouldn't have that nice house. The risk is the whole point.

That being said, I wouldn't be opposed to legislation requiring better disclosure of loan terms, or even legislation requiring the forgiveness of new student loans going forward if the student dies (even if that increases the interest rates across the board to spread that risk). But forgiveness for mistakes that have already occurred, that's not fair to the people that didn't make the same risky bets.

And of course, depending on how much money this kid went into debt "to study music production", I think there's a pretty good bet the mother would end up on the hook for the loans anyway even if the kid lived. I wonder if she would have found that fair.

[Abe Sargent]

I feel very much for her, and just prayed for her.

But a valid point is that these organizations are out the money paid the school. Why should they pay for the son's unfortunate passing? Plus, can;t she declare bankruptcy if she can;t make the payments? We already have laws to help her.

[stevew]

You can't bankrupt student loan debt. You can buy a house during the bubble and walk away and get protection from 250k worth of housing debt. But that 25K worth of student loan debt can never be forgiven.

[Abe Sargent]

Really? That's odd, and seems like a loophole, i would support considering closing.

[M GO BLUE!!!]

I don't think she made a mistake in co-signing the student loans. She thought her son was trustworthy and there is nothing to suggest he wasn't. He died. As far as we know it's not his fault and not hers. That's just life. You sign a loan and you are taking responsibility for it.

I feel bad that she isn't able to actually cope with her son's death. If she were to have died would she want him moping around unable to work due to depression? No. She would want him to live as healthy a life as possible. It's sad that her child is gone, but there's nothing that can be done about it. You can't let another person's death kill you too.

[RainMaker]

The idea behind it is that kids couldn't run up $200k in debt and then get out and immediately file bankruptcy. That has been abused though and is no longer used for what it was intended to. An easy fix is to allow co-signers to file bankruptcy on the loans for instances like this when the student has passed away. There should be absolutely no reason for this.

The big fix though is an educational system where parents in their 50's and 60's don't have to take on massive debt risk to send their kids to college.

[molson]

I thought of this thread when I read this blog post:

Parent Cites Stepson’s Law School Debt In Suicide Note « Above the Law: A Legal Web Site – News, Commentary, and Opinions on Law Firms, Lawyers, Law School, Law Suits, Judges and Courts (http://abovethelaw.com/2012/11/parent-cites-stepsons-law-school-debt-in-suicide-note/#disqus_thread)

About the second half of this NYTimes article:

Some Parents, Shouldering Student Loans, Fall on Tough Times - NYTimes.com (http://www.nytimes.com/2012/11/12/business/some-parents-shouldering-student-loans-fall-on-tough-times.html?pagewanted=all&_r=1&)

I think more people are starting to understand that going into six figure debt for a degree is a ridiculous gamble, but plenty of people are still doing it. I'm generally a caveat emptor kind of guy as long as the terms of the transaction are transparent and not fraudulent, but it still kind of creeps me out that you can borrow $200,000 in non-dischargeable debt from the government (and then $100,000 on top of that from a private company), for a degree which is not going to be a good investment at that price for at least 95% of people. I think a lot of people naively going into these kinds of commitments, because, "hey, it's the government, they're not going to rip me of or make some crazy deal with me that will ruin my life." I don't think student loans actually killed the guy in the article, but I think they do fiscally destroy many, many people. So many people in their 20s and early 30s are starting adulthood in holes that they will absolutely never get out of. I think this has much more of an impact on income and wealth disparity than tax rates or a bunch of overpaid CEOs, but the latter two get so much more attention.

[RainMaker]

What other option does someone have? High school grads are not exactly seeing a great market for jobs.

[molson]

What other option does someone have? High school grads are not exactly seeing a great market for jobs.

Some state undergrad degrees are still a decent bargain, and there's plenty of scholarship money is available if you excel academically. If a kid can't get into a decent college or graduate program without paying the full sticker price, he or she should probably look into trade schools - become a mechanic, plumber, electrician, etc. If your only option is to borrow $300k for a graduate degree, you're literally better off waiting tables and bartending.

Even something like the $85k I ended up borrowing between undergrad and law school isn't too bad - you can take a big chunk out of that in a hurry with a few years of living frugally and then it's just a couple of hundred bucks a month. (It was still a gamble, I wouldn't have borrowed $85k for an undergraduate degree alone). I paid off enough now where I could re-consolidate it and pay something like $120/month for the next 25 years, but I'm looking to pay it of faster. $300k is just ridiculous, there's no way to make that work. (Edit: That's about $2,100/month for 25 years at 6.5% interest, in a legal market where schools outside the top tier are placing less than half of their graduates in legal jobs 9 months out of school - and in the cases of the lower tiered schools, they're placing way, way, less than that.)

[RainMaker]

I agree. Kids have to be smarter about their choice. Choose an in-state school over out-of-state when you can. My point is more that college is practically mandatory if you want to be successful. And for most people, it's still a better option. I believe the lifetime earnings difference is $1 million.

I also think these $300k people are extremely rare. Seems like the average is $30k.

[Suburban Rhythm]

I'm biased, but I've always questioned the need people have for attending a big name university as opposed to a local school.

Sure, there is some prestige carried in the name on the top of your degree, but is that alone worth 10X the price?

I attended one of the 14 state schools here in PA. Graduated in 1998. Tuition was something like $2,000 a semester for in-state students. Looking now, tuition is $3,200 a semester, in-state.

Is attending one of these schools the same as going to Harvard? No.

I was lucky to end up on a full tuition scholarship. My wife walked away with a decent chunk of school loans, which, 12 years later, were paid off. And no she wasn't making ridiculously large payments, something in the $250-300 range a month over that span.

We both have stable jobs, in decent professions, without paying $100,000+ for our educations. While it's naive to think that will work out for everyone, it's also naive to believe you'll get a 6 figure job because you paid $200,000 to go to the University of Trout.


ETA - or what Rainmaker said up there ^ in fewer words.

[molson]

I also think these $300k people are extremely rare. Seems like the average is $30k.

For undergrad and some graduate programs, yes. For law and some other graduate programs it's definitely getting more common. And so many of those graduate degrees are worthless and so many of the law schools are crap and not placing anyone. But ya, maybe the answer to this is just getting the information about the risks out there, and that is happening and having some effect, law school applications are finally starting to go down.

[molson]

Is attending one of these schools the same as going to Harvard? No.


Harvard's probably worth the money, maybe even the debt. The biggest issue to me is private for-profit schools that are both lightly regarded and incredibly expensive - often more expensive than Harvard.

[Drake]

Debt should die with you. Period.

[finketr]

community college for 2 years, transfer to in-state 4 year school

[Abe Sargent]

many seminaries get money from private donors and churches so that tuition won;t be that bad for people who will be getting jobs that have low salaries. When a minister may make 20-50k a year pastoring your normal church while requiring a three year grad degree, you can understand why institutions do everything they can to drop the price of tuition.

[Philliesfan980]

I'm biased, but I've always questioned the need people have for attending a big name university as opposed to a local school.

Sure, there is some prestige carried in the name on the top of your degree, but is that alone worth 10X the price?

I attended one of the 14 state schools here in PA. Graduated in 1998. Tuition was something like $2,000 a semester for in-state students. Looking now, tuition is $3,200 a semester, in-state.

Is attending one of these schools the same as going to Harvard? No.

I was lucky to end up on a full tuition scholarship. My wife walked away with a decent chunk of school loans, which, 12 years later, were paid off. And no she wasn't making ridiculously large payments, something in the $250-300 range a month over that span.

We both have stable jobs, in decent professions, without paying $100,000+ for our educations. While it's naive to think that will work out for everyone, it's also naive to believe you'll get a 6 figure job because you paid $200,000 to go to the University of Trout.


ETA - or what Rainmaker said up there ^ in fewer words.

Pretty much the exact same story here. I graduated from one of the 14 PA state schools in 2003, got my CPA and now I am fairly successful. Most of my co-workers and I (who are in positions that hire) readily admit that where you went to school has little to no bearing on us hiring you.

We'd much rather hire someone from a state school who has very good grades and a great personality than some snob that we can smell out has "entitled" written all over them a mile away. Generally works out very well for us. Give me the hungry scrapper any day of the week.

[cougarfreak]

Debt should die with you. Period.

It does. But she's not dead. And she was a co signer. I feel for her, but she took the risk.

[Desnudo]

Harvard's probably worth the money, maybe even the debt. The biggest issue to me is private for-profit schools that are both lightly regarded and incredibly expensive - often more expensive than Harvard.

Harvard is worth the money, but not 150k extra in debt or whatever. Purely economically speaking. The ego boost is probably nice.

[Suburban Rhythm]

Harvard's probably worth the money, maybe even the debt. The biggest issue to me is private for-profit schools that are both lightly regarded and incredibly expensive - often more expensive than Harvard.

I know a few people who work for one of those companies. While I think it's pretty sleazy, these kids, and their parents, still are not obligated to attend and/or take the loans. Alot like people taking mortgages much bigger than they can afford.

And I agree Harvard is worth the money.

It's the levels between Ivy League and small state schools.

I applied to 3 colleges - the small state school, where my sister was already attending, Pitt, and St. Vincent's (where Steelers training camp has been since the dawn of time). State school $2,000 a semester. SV $17,000 a semester. Getting the scholarship to the state school made the decision that much easier.

Would I have advanced further at this point in my career for having attended SV? No idea. Would it be so much further that I'd have accrued about $120,000 in loans and it be worth it? I have my doubts

Pretty much the exact same story here. I graduated from one of the 14 PA state schools in 2003, got my CPA and now I am fairly successful. Most of my co-workers and I (who are in positions that hire) readily admit that where you went to school has little to no bearing on us hiring you.

We'd much rather hire someone from a state school who has very good grades and a great personality than some snob that we can smell out has "entitled" written all over them a mile away. Generally works out very well for us. Give me the hungry scrapper any day of the week.

I started right out of school at one of the two huge Pittsburgh banks - where probably 50% of the local grads start each year.

In orientation, there were 3 girls who all attended Washington & Jefferson, a $20,000 a semester school outside of Pittsburgh. When we figured out we were all working on the same floor, it was "Oh...you went to that state school? We went to W&J!"

After hearing how great of a school it was for a whole day, my end response was "Huh....and yet look where we all ended up?"

Like my example above, if your resume says Harvard or Princeton, it's going to catch my eye. Outside of that, everything is lumped together. More importantly, can you string together 3-4 complete sentences when speaking.

[stevew]

Which one of our lovely schools did you go to?

I knew a dishwasher/future EatNPark assistant manager who went to St. Vincent...helluva way to blow 90K.

Other retardedly expensive schools in the state that probably don't buy you that much....Thiel(Greenville is a shithole), Duquesne(who the fuck pays this much for a school), and I wonder if Allegheny College is actually worth what it costs(probably not).

[Suburban Rhythm]

Which one of our lovely schools did you go to?

I knew a dishwasher/future EatNPark assistant manager who went to St. Vincent...helluva way to blow 90K.

Other retardedly expensive schools in the state that probably don't buy you that much....Thiel(Greenville is a shithole), Duquesne(who the fuck pays this much for a school), and I wonder if Allegheny College is actually worth what it costs(probably not).

I went to Cali...aka Harvard on the Mon

If you have ever had the pleasure of driving through California PA, don't blink...you'll miss it's lone redlight.

[stevew]

I went to Cali...aka Harvard on the Mon

If you have ever had the pleasure of driving through California PA, don't blink...you'll miss it's lone redlight.

Ah...I didn't know anyone who went there. Contingents went to Grove City, Pitt, PSU, Slippery Rock, and maybe even Indiana U of P, but nobody went to Cali I know.

I just checked on Allegheny...freaking approaching 50k/year for tuition room board and books.

[Suburban Rhythm]

Which one of our lovely schools did you go to?

I knew a dishwasher/future EatNPark assistant manager who went to St. Vincent...helluva way to blow 90K.

Other retardedly expensive schools in the state that probably don't buy you that much....Thiel(Greenville is a shithole), Duquesne(who the fuck pays this much for a school), and I wonder if Allegheny College is actually worth what it costs(probably not).

Don't get me started on Duquesne. My current employer, the founder graduated from Duquesne. I'm going to estimate, conservatively, 65% of employees have a link to Duquesne. Another 30% or so through nepotism. I'm part of the 5% that I have no clue who I pissed off to end up here.

Ah...I didn't know anyone who went there. Contingents went to Grove City, Pitt, PSU, Slippery Rock, and maybe even Indiana U of P, but nobody went to Cali I know.

I just checked on Allegheny...freaking approaching 50k/year for tuition room board and books.

I think the 14 state schools are all pretty much the same. IUP, I think, is the largest, both campus size and enrollment. But outside of that, all pretty similar, other than if one has a "specialty". Cal started as a teacher's college, so probably 70% of grads are education majors.

[kcchief19]

What would be the harm in requiring any student loan with a co-signer to carry a mandatory life insurance policy? A 15-year term life insurance that would cover school and 10 years of repayment for a 20-something would have to be ridiculous cheap, maybe a few dollars per month. Compared to the cost of the loan, that's pretty cheap.

Even if you don't make it mandatory, make it difficult for people to get out of paying the premium without showing means to repay the loan. These loans are usually just signature loans, so the lender isn't looking for an ability to pay.

[RainMaker]

What would be the harm in requiring any student loan with a co-signer to carry a mandatory life insurance policy? A 15-year term life insurance that would cover school and 10 years of repayment for a 20-something would have to be ridiculous cheap, maybe a few dollars per month. Compared to the cost of the loan, that's pretty cheap.

Even if you don't make it mandatory, make it difficult for people to get out of paying the premium without showing means to repay the loan. These loans are usually just signature loans, so the lender isn't looking for an ability to pay.

What would be the harm in allowing co-signers to file bankruptcy on school loans if the student dies? The law was put in place so that kids didn't abuse it by filing bankruptcy immediately after graduating. Dying doesn't seem to be a tactic to avoid paying a loan.

[DanGarion]

Really? That's odd, and seems like a loophole, i would support considering closing.

Why? A house has value after someone defaults on it to the owner of the loan, your education does not...

[RendeR]

It does. But she's not dead. And she was a co signer. I feel for her, but she took the risk.


Actually with my mother aging rapidly I dfound it very unsettling that debt does NOT in fact die with you.

The beneficiary of an estate takes on that estates debt as well. I discussed this with mom and we decided it made far more sense for her to spend a large chunk of her retirement on getting out of debt entirely. yes she gets less each month now but she's also paying out far less and not collecting interest on money spent years ago.

I think life insurance should be a requirement for taking on large debt levels like college tuition. Young people are decidedly low risk when it comes to death in general compared to other age groups. Costs for such things should be minimal. 15-20 bucks a month to cover 100k in coverage.

IF this person had taken the time to purchase life insurance she would not only not be in massive debt, but would have been able to secure the grandchild's future education by creative a trust fund for them.

[RendeR]

What would be the harm in allowing co-signers to file bankruptcy on school loans if the student dies? The law was put in place so that kids didn't abuse it by filing bankruptcy immediately after graduating. Dying doesn't seem to be a tactic to avoid paying a loan.


True enough, but if you allow cosigners to declare bankruptcy then you create an entire group of people who's children then default on their loans, turning the banks on their cosigners who in turn declare bankruptcy, in effect stealing the education from the loan grantors.

[judicial clerk]

I believe that you can bankrupt out of student loans if you can prove that you can no longer use the education. I have no idea about the cosigner. Being a cosigner is always a red flag to me.

Don't get me started on the educational industrial complex. It is a money grab that is only just now being brought to light. Law schools, for example, have been fudging their placement numbers for years and pumping out way more attorneys than are needed.

[Drake]

I think life insurance should be a requirement for taking on large debt levels like college tuition. Young people are decidedly low risk when it comes to death in general compared to other age groups. Costs for such things should be minimal. 15-20 bucks a month to cover 100k in coverage.

IF this person had taken the time to purchase life insurance she would not only not be in massive debt, but would have been able to secure the grandchild's future education by creative a trust fund for them.

I actually really, really like this idea. Build a 20-year term life insurance policy into the loan amount to cover the value of the loan. Just make it part of the default loan package, and with the volume of lending, set it up at group rate accounts so it's only going to cost a few bucks a month.

That's a brilliant idea, Render.

[RendeR]

THank you, Thank you, I'll be here all ....well..forever.

[M GO BLUE!!!]

Here's a good one on the White House's petition site!

Give Toledo, Ohio, to the State of Michigan | We the People: Your Voice in Our Government (https://petitions.whitehouse.gov/petition/give-toledo-ohio-state-michigan/0cvjC4fn)

[sterlingice]

What would be the harm in allowing co-signers to file bankruptcy on school loans if the student dies? The law was put in place so that kids didn't abuse it by filing bankruptcy immediately after graduating. Dying doesn't seem to be a tactic to avoid paying a loan.

Does anyone know when this law was changed? Being somewhat cynical about this sort of thing, I was going to guess it happened shortly after you could start getting private loans to pay for college.

SI

[sterlingice]

Harvard is worth the money, but not 150k extra in debt or whatever. Purely economically speaking. The ego boost is probably nice.

Screw ego boost- schools like that are about the connections to old (and possibly new money) you'd make and nepotism. Ivy League is probably worth it if you're in the right field. But that field needs to be finance or some other business-related venture. I'm not sure what getting an English degree at Harvard is good for.

SI

[sterlingice]

I actually really, really like this idea. Build a 20-year term life insurance policy into the loan amount to cover the value of the loan. Just make it part of the default loan package, and with the volume of lending, set it up at group rate accounts so it's only going to cost a few bucks a month.

That's a brilliant idea, Render.

Seems like a good thing. I also expect something we might see in the future if the problem keeps rearing its ugly head more and more. It could either be a benefit to society by not screwing those who cannot afford it. Or it will provide a good chance for a Senator to kick back some favors to a life insurance company. I'm certain it will be for the altruistic former version which benefits society and not the latter (sigh).

SI