Skip to comments.Debt Collectors Cashing In on Student Loan Roundup
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 ...
People stupid enough to borrow $90,000 in student loans deserve what they get.....especially those who do it earn worthless liberal arts degrees!!!
This was all calculated and expected, I assure you. The Obama regime WANTS debt slaves. They want people to owe them. They might give them a pass to appease them, a surreptitious vote buying scheme, but in the end, they’ll owe that money whether through taxes, direct payments, or even estate seizures after they’re dead and buried.
I’m thankful that I paid off my student loans 5 years ago. That’s one very large chain off my shoulders.
Debt collectors across the board are much better off than they were four years ago.
I had a series of part time jobs while in school and graduated with some money in the bank...
Debt collection is one industry which deserves close and rigorous regulation. They’re scumbags.
One company based in California calls and sends me letters trying to recover debts I do not owe to San Antonio hospitals in which I have never received treatment. NEVER!
Complaints to the Attorney General of Texas were simply forwarded to the Attorney General of California who simply forwarded the complaint to the scumbags who answered with a truly BS reply. They basically claimed I was covering for someone within my household who did owe the debt. Scumbags!
After several months of not hearing from them, thinking my demand they cease contacting me and remove me from their database, they started up again!
“Big Education” makes “Big Oil” look like choir boys by comparison.
Oh come on, don’t be so harsh on those who take out a $50,000 loan to pay for their basket weaving PHD.
Have a heart. /s
Whatta liar. You don't go into repo unless you're a conscience-less blood sucker. I once talked to a used car dealer who wanted my comment about a psychological profile that showed he "lacked empathy." I just told him he was in the right line of work.
Worthless? WORTHLESS???? So tell us,exactly how much do *you* know about medieval art history?
400 % inflation since 1980?
In all fairness, someone has to teach kids about history. Do you only want died to the wool liberals getting history degrees and teaching kids (and don’t give me “Well I’ll just teach them the truth at home”).
Nor will you be able to leave the sinking ship, like your Rat masters will, in the end.
Yes it does.
Professors constantly demand more pay at the same time they stir student anger at rising costs all the while writing the very wildly overpriced textbooks they deem to be required for their courses.
Meanwhile K thru 12th grade teachers focus like a laser on credentials that require a steady diet of college courses, all the while they further dumb down the students to lead them into the feedback loop.
We’re all very proud of my niece for dropping out of college and going to work, not because she couldn’t handle the work but because she realized that she was being led into slavery.
A liberal arts graduate I’ve heard of spent over $ 3 trillion llast year. That may be worthless, but it sure costs a lot.
I just remember student after student begging BO during the 2008 campaign for him to forgive their debt once he was elected.
Worthless degrees in gender studies, minority studies and human sexuality. No wonder those idiots can’t find a job.
I changed degrees three times. Each time I did, I made sure it was into a field that had multiple jobs available. WTF where these idiot losers thinking? That they would get jobs to teach worthless people like themselves?
And I paid off my student loan in full about 3 and a half years ago. When I called to find the balance on a certain day so I could pay online, the customer service rep was stuttering. Apparently, he wasn’t getting too many calls to pay off loans, only how to defer them or to find out how much trouble they would get in for nonpayment.
One waitress I spoke with had taken classes at Phoenix University online. She took a few classes, decided it wasn’t for her and dropped out. Problem was that she is still on the hook for I think about $12,000 or so in tuition. She was already geting hounded for repayment and had no way to do so. She was 18 and her credit is already ruined. She was painted a pretty picture and being a semi-child, she took the bait. Where is the counterbalance to these people pushing student loans?
Get a police whistle.
Keep it near your phone.
I think you’re right. And that’s probably why he nationalized student loans with the federal government - no private middlemen. If you borrow for school, it’s all government money.
These loans are mainly for undergraduate degrees, associate and baccalaureate. Doctoral degrees are tuition free to those who get fellowships. In most cases, anyone getting a doctoral degree without getting a fellowship is foolish. (Obviously there are some exceptions to that rule.)
Or political science degrees.
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.
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.
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.
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.
“Oh,thats a worry.I didnt know about the weight sensors.”
It’s a worry to me. I’ve had a kid in the back sleeping and my mind wondering...just to look over my shoulder (while driving) and get a shock through me when I saw the kid. I just don’t have a perfect, one track, memory, and I will drift to other things, at times.
The other thing to note is this deadbeat is putting the kid directly behind the driver, which makes it just that much easier to forget about him.
The weight sensors were added after 100 or so kids got decapitated by air bags. It was either that, or getting rid of air bags, and we’d NEVER want to do that. LOL. The older cars, I think pre-2000 or so, can get cut-off switches installed for free, to disable the passenger-side air bags, for those cases.
Geez, stop borrowing money already.
I got a political science degree going to night school. I already had a career as a federal employee. I went on the GI bill so had no debt to pay off. True, it was pretty useless, but it was discriminant; one couldn’t get promoted without a degree. About the only courses that ever did me any good was the two years of French I took. My job took me to Francophone Africa a few times. I loved history. Still do.
And the liberals who dreamed this up to reward the Commie professors!!
That W is the gift that keeps giving...and now TSA wants to unionize .
Why make government the prime source for student loans?
Obama Breaks Down Student Loan Overhaul
He will also talk about the provision’s less controversial expansion of Pell Grants, as well as supporting historically black and minority institutions and caps on student loan repayments.
According to the White House, “New borrowers who assume loans after July 1, 2014, will be able to cap their student loan repayments at 10 percent of their discretionary income and, if they keep up with their payments over time, will have the balance forgiven after 20 years.”
So basically, you need to make sure you buy or rent a living space expensive enough to maximize your non-discretionary spending, so you make the absolute minimum student loan payments for 20 years. Then the debt disappears!
Or more acurately, your debt gets paid by other Americans, which is “free money” to you.
And again I say, those of us who pay off our loans and debts sure look like chumps.
These investments complement President Obamas broader agenda for higher education and will help us reach his goal of America having the highest proportion of college graduates in the world by 2020.
(with absolutely no thought given to QUALITY)
Public service workers such as teachers, nurses, and those in military service will see any remaining debt forgiven after just 10 years.
You don’t get to calculate your own discretionary income. It’s just a number set by the government based on your faimly size.
And a waitress can pay off a $12,000 loan. Bet she’s got a car loan for more than that. People need to suck it up and pay their debt!