At that hearing, almost 10 years ago, I told the senators that our
typical student loan debtor was a female, aged 37, with over $ 8,000 in student loan debt.
These scams take advantage of the uncertainty and inexperience
of student loan debtors who happen to be mostly Millennials.
The decision may offer some guidance, however, towards establishing a more uniform set of criteria
for student loan debtors in bankruptcy.
This week the White House announced a new Student Aid Bill of Rights, which aims to help federal
student loan debtors with better options and more clarity in dealing with their problem student loans.
While the bill almost certainly would have
helped student loan debtors who are struggling to repay their loans, it would not have addressed the issues that keep the total number of debtors growing, along with the total amount of debt.
If the recent position by the Department of Education under the Trump administration is any indication of what is to come for
federal student loan debtors, watch out.
According to the CFPB report citing the New York Federal Reserve, the number of
senior student loan debtors over the age of 60 has quadrupled over the past ten years.
For student loans, there are specific programs like loan consolidation and loan rehabilitation that are designed to
get student loan debtors out of default.
If
private student loan debtors were behaving opportunistically pre-policy, we would have expected a sharp relative decline in bankruptcy filings after the 2005 provision impeded their alleged opportunistic behavior, as compared to debtors whose incentives were not directly affected by the nondischargeability provision.
This recent action and the fact the Department of Education has not approved Borrower Defense claims leads me to wonder where is any proof the Department of Education gives a damn
about student loan debtors.
For student loans, there are specific programs like loan consolidation and loan rehabilitation that are designed to get
student loan debtors out of default.
While the Federal Reserve influences the economy by setting interest rates and controlling monetary supply, the central bank is unable to directly help
struggling student loan debtors.
The Department of Education published data that showed roughly 60,000
new student loan debtors will enroll in Public Service Loan Forgiveness each quarter.
So
many student loan debtors were never properly informed about how to organize their loans for forgiveness under the PSLF program so sadly those payments will not count towards forgiveness.
One of the most frightening changes for
most student loan debtors is the news that beginning July 1, 2012, student loans will not be subsidized.
There are students that have been waiting years for a conclusion to their claims and the next changes will only serve to slow down the entire process of assisting
harmed student loan debtors.
Goodness knows how long this new process if going to take and what
opportunities student loan debtors will have to actually have their loans discharged due to misrepresentation by colleges and schools who received federal student loans.
Student loan debtors working in public service fields like teaching may qualify for forgiveness, but only after making 10 years of payments.
More than three out of five (61 percent) of bankruptcy attorneys dealing with
potential student loan debtor clients have seen cases of debts more than 15 years old still being pursued.
Most bankruptcy attorneys (95 percent) report that
few student loan debtors are seen as having any chance of obtaining a discharge as a result of undue hardship.
In most cases (probably 90 percent or more), the bankruptcy judges rule that
student loan debtors do not qualify for bankruptcy relief under the «undue hardship» test.
There is a big difference between adjusting rules and regulations to help
student loan debtors buried in federal government loans find any hope of a better future, and what is happening now at the Department of Education...
What sets CommonBond apart from other alternative lenders is that it
allows student loan debtors to consolidate undergrad and graduate loans into a variety of fixed rate, adjustable rate, and hybrid loans.
Secretary of Education Betsy DeVos seems to be waging a terrible war
against student loan debtors who have been defrauded by their schools in order to extract federal student loan money.
That specific 2015 guidance
said student loan debtors who defaulted had up to 60 days after default to enter into a satisfactory repayment plan or rehabilitation to avoid up to 16 percent collection fees being added to their balance on day one of default.
But, any reimbursement benefit, even if it is taxable, will help
student loan debtors repay their loan balances sooner than if they did not receive any benefits at all.
According to the Consumer Financial Protection Bureau (CFPB), the number of
student loan debtors age 60 and above quadrupled from 2005 to 2015 and the average outstanding balance almost doubled to $ 23,500.
The first setback refers to a congressional decision to withhold tax relief for severely
disabled student loan debtors who receive student loan discharges.
In another class action complaint filed last year against Sallie Mae and Navient, plaintiffs claim that servicers are systematically
defrauding student loan debtors about their bankruptcy discharge rights.
In fact, the average female student owed nearly 20 percent more than her male counterpart at the point of insolvency, and 60 percent of
student loan debtors overall are women.
In addition to the
difficulties student loan debtors already face, Congress has failed to pass legislation regarding interest rates on new federally - subsidized student loans.
The debtor can not maintain a minimal standard of living for himself and his dependents if he must pay the student loans
On Wednesday, the Education Department announced it is looking to clarify what constitutes «undue hardship» to
give student loan debtors a better chance at having their loans expunged, and opportunities for more borrowers to apply for bankruptcy if needed.