Student loan debt relief in the news again.
I predict this to become recurring theme, for years to come.
From the Wall Street Journal story on student loan forgiveness:
Officials said that under the emerging plan, the costa rica government will consider forgiving any loans made directly from the government-those held by the majority of the 43 million Americans with student debt-so long for the reason that borrower can document a college persuaded him or her to take out the financing under conditions that would violate state laws.
Watch that word “emerging.”
The National Consumer Law Center site states what has emerged so far, forget about what MIGHT happen, this is what we know:
- Extend closed school loan discharge eligibility to Corinthian borrowers who withdrew at a closed school on or after June 20, 2014.
- Grant loan cancellations and refunds to borrowers who decided upon a Heald College campus and program for that time frames listed here. Borrowers, however, must make use of this application to apply for relief.
- Provide loan forbearance and suspend collection on loans for Corinthian borrowers who definitely have applied for relief based on their schools\’ state regulations violations (called \”Defense to Repayment\”) or who work toward applying for this relief within Year. To request forbearance, students may call (855) 279-6207 or submit a web based request.
- For borrowers not part of the above groups, appoint an extraordinary Master to develop a system that borrowers to assert a Defense to Repayment, including non-Corinthian borrowers. For Corinthian borrowers, this tends to include a \”simple\” application form and possible relief for teams of borrowers based on the evidence of \”appropriate authorities.\”
The federal Department of Education, to be a part of the government, seems incompetent at changing any existing policy, or implementing a different policy, without creating new bureaucracies, or, a minimum of, new bureaucratic positions.
Now, don’t do not understand, there is plenty of fraud being perpetrated by colleges available, whether profit or non-profit.
I sued Ohio University first such fraudulent program, together with the student loan lenders, as part of an instalment 7 bankruptcy adversary proceeding to release the student loan debt as an undue hardship.
Unfortunately, the Detroit bankruptcy court didn\’t have jurisdiction over them, and, my client did not owe them any money to have discharged, and I had to agree to dismiss them from the suit.
Scott Alexander makes the best statement of the student loan crisis I have seen, in the associated with article.
Ohio University had no skin at the tables, they tricked my client, the govt paid Ohio University, and my client was residing in her parents’ basement working at Home Depot.
Doesn’t seem right, would it?