Nor did i ever get my diploma..

I hope these people are held to some accounting.. whom ever they are!

Never get a sallie loan…. EVER. i had a credit score 300 for ten years while i paid it off. I could not even get a bank account.

Ezra Pound wrote: "With usura hath no man a house of good stone." I might add that he also does not have the ability or time to dream or innovate because he may have to take a job or the first job that comes along in order to pay the vig.

Let me tell you, I am trying to file bankruptcy knowing that my private loans may not be helped, but I just ran into an issue with bankruptcy – we do not qualify for chapter 7 because we failed the unconsitutional means test and guess what? We don't qualify for chapter 13 either because our unsecured debt is over $336k (there are debt limits for ch 13). So, the only option is chapter 11 which is used for businesses and as an individual, I cannot afford 20-50k to pay a lawyer to file for ch 11.

Our system is rediculous. Nobody, not even Obama is going to help us.

http://kcts.org/video/borrower-beware

Send this to everyone you know who's affected by the corrupt student loan companies, including college & university staff.

For example, it use to be that student loans were to close the gap between grant money and tuition. For several years (and for many students) back in the 80s I needed ZERO student loans. I had a par-time job and the financial aid I received covered it.

THIS IS NO LONGER THE SITUATION. Today’s student is forced to take out loans because there is not enough grant money. A student simply cannot work more than 20 hours a week and hope to do well. Sure, there are some who do, but most cannot—especially if they are attending a real school and not one of those proprietary diploma mills where they grant As for merely attending.

The schools now know, and operate knowing, that student loans are freely available, hence they raise tuition year in and year out. Sometimes they will even raise tuition semester to semester! They know the student is faced with one of two choices, take a loan or quit school. A few choose to quit. The schools (if they are reputable) have no shortage of potential students waiting in the wings eager to borrow for the chance of a better life. Our society ingrains in people virtually from birth that a college education is a must to have any chance at an above average life.

In fact, today it is common to even suggest that a BS is what a high school degree use to be, hence, there is even some pressure to go on to get a graduate degree. The schools themselves are complicit in fostering this need for a graduate degree.

Now in graduate school the alternatives are even fewer. Some, have the good fortune of getting fellowships, however, others must finance their degree 100 percent! In addition, if it happens to be a degree requiring a thesis or dissertation, the committee can easily add an extra year to two years to the degree program simply because they want to keep the student around to finish THEIR RESEARCH! If you do not think that professors do this to students then you are clueless.

Furthermore, many quality colleges are into INTERNATIONAL DIVERSITY! What does that mean? It means they grant fellowships and graduate assistantships to foreign students at the EXPENSE of the American citizen or permanent resident. The citizen is offered DEBT.

If you believe that a college degree is what a high school degree use to be and society has traditionally paid for a high school degree, then isn’t it about time that we consider that society pays for a college degree? Again, society paid for what was then the standard education level to survive in a manufacturing society. We are still stuck on that model. We need to pay, as a society, for college because it benefits all of us. Just like paying for a high school degree benefited all of us when a high school degree mattered.

At the very least, bail out these people by allowing those who qualify to retroactively amend their bankruptcy to include student loans!

Die Sallie Mae…Die

If these costs would then decrease, then the amount of loans required per borrower would not be as high as current. This would give the borrower a better chance of payoff.

FACT: My ALLEGED student loans, in the principal amount of $19k, have exploded to over $50k, including over $10k in "fees and costs" payable before interest and before principal to aforementioned collection agency. These "fees and costs" are to defray the costs of "locating [me] for collection purposes." I have lived at the same address and have worked at the same job for over 5 years.

FACT: Student loans, high treason, and murder are the only three things in American jurisprudence for which there are no statutes of limitations. Eventually, even rapists and kidnappers are off the hook.

Sallie Mae, et. al. make money through loan default and capitalization during deferment. When the millions who end up in default get their final bill, the the loans have doubled or more. Sallie Mae et. al. add late fees, penalties, then crank the interest to 18% or more. After a time, those fees and interest are capitalized. Then, the lender puts the loan back to the government – the $20k loan that was guaranteed by the taxpayer is now a $40k bill.

There is no free market in student loans. It begins with the student loan administrator at the school Most have "deals" with certain lenders. In the last 24-36 months, administrators at USC, Columbia, Johns Hopkins, U of Texas, Emerson, and others have lost their jobs over financial kickbacks and other items of value they personally received from their "preferred lenders."

Student loans are afforded less consumer protection than any other loans by a longshot. Various politicians such as Buck McKeon, John Boehner, and Lamar Alexander have taken tens of thousands of dollars from loan providers to provide such protections to the middlemen such as Sallie Mae and Nelnet.

Sallie Mae is the group commanding the most attention given the arrogance and greed of their CEO. Everyone was all indignant when the auto industry showed up for taxpayer bailout funds in their private jet. Sallie Mae has THREE private jets. Their CEO has two mansioned estates, one with his very own private 18-hole golf course.

Yeah . . . you're probably right. This situation is the student's fault.

The real nail in the coffin that nobody talks about is the negative amoritization. Negative amortization kicks in immediately while the student is in school. No payments while in school sound great until that principal has ballooned. Reduced payment plans and forbearances sound great during those first few years after college until that principal keeps ballooning. Other practices are possible such as interest that accrues but is not compounded into prinicpal.

When you have colleges and universities with multi-billion dollar endowments who 1) still have tax-exempt status, and 2) put "tuition" towards buildings, real estate, and inflated professor salaries they should not be charging such over the top tuition but asbsorbing it themselves. Do you realize third tier schools charge similar tuition as the first tier schools? Yes the lending industry, colleges and universities, and government policy have been in cahoots to the detriment of the students who already have financial indentured servitude for life. The effect is wide spreading and ever expanding.

I the early 80's, I took out $70k in loans for my Ph.D. which ballooned to $129K by the time I finished my program in 1990. My first job out of school at an Ivy League school paid $33k. 50% of my take home was required to pay the loan. Over the years my salary never kept pace with the payments. When the payments exceeded the amount I lived on I gave up. Because of legislation, there is no re-negotiation or restructuring of the loan, even with a demonstrated inability to repay, except smaller payment plans or forbearance, which have the net effect of ballooning the principal to unimaginable levels, and impossible-to-pay levels. For years this went on until finally, at age 50, I was sued by the Department of Justice for $250k loan. We are currently working on a settlement because it is "now apparent to all" how unserviceable this loan is given my income history. Although I had nothing to discharge, I had to file for Chapter 7 as a legal strategy to get into the bankruptcy courts where the judges there apparently have more discretion in my state.

I think the student loan industry will be the next wave of credit implosion, and the bankruptcy laws will have to be rewritten. Repayment options may change the compound interest to another method as well as write-offs for community service for example.

For all intents and purposes, this type of lending, and especially repayment practices are nothing short of a modern day version of PREDATORY LENDING. No where in the credit world of unsecured debt does interest perpetually compound once the borrower has shown a definite inability to re-pay.

Debtor slavery indeed. I hope the Obama administration will restore basic consumer protections to those who borrow for their education.

And I hope it is retroactive. Because of illness, I was unable to pay the principal on a $27,500 loan. Because of a fixed 9% interest rate, the amount I owe to Great Lakes Higher Education is now $96,000. I know someone whose debt now approaches $200,000. Sanity must be restored to this situation.

"I am a Democrate who voted for Obama and am very lberal on social programs but I have to tell you you have it all wrong…spend sometime and do some real research!"

Sorry, but my research and my facts have it right.

FACT: I've paid $106,000 on a $60,000 loan, and still owe at least $98,000.

FACT: That's almost 2 1/2 times the original loan amount (240% profit). My debt is still growing.

FACT: Congress amended the Higher Education Act (HEA) at the express request of the student loan companies, Sallie Mae in particular. The loan companies weren't reluctant participants; they initiated the changes. Why? Because of the enormous profit potential.

FACT: Costs of higher education have increased. And some colleges/universities have profited directly from the student loan industry's practices. They and the loan companies collaberated.

CONCLUSION: The student loan companies, colleges & universities, and Congress acted together to create the current situation. And only Congress can change it. Sallie Mae won't. Not when there's possible profits of 200%, 300%, or even 400%.

1. when a student defaults on a student loan it is the Government, not the lenders who garnish the wages including disability.

Banks lend, governments (federal and state) guarantee the loans. The bank is obligated to comply to all the required rules to service and collect these loans, if any of these are missed are performed incorrectly the guarantee is lost and the loan is "gapped". Gapped loans are now 100% on the lenders books with no reimbursement from the feds. Those gapped loans are not subject to the garnishment you mention.

2. The profitability of student loans is extreamly low. In fact the profit margins are so small most banks would prefer to not participate in the program going forward which is why you see so many lenders leave the market. I agree at one time in history student loans were cash cows for the banks, but those days are gone due to numerous regualtory changes over the past 5 years. The lenders remaining in the business are either commited to the Student population to ensure they can pay for school.

3. The real problem is the cost of education…ever wonder why the schools are so quite and don't speak out against the big bad lenders? its because they are afraid the spot light will be pointed at them. Tuition and room and board have increased at a rate about 25X higher then inflation or cost of living. The only reason students have so much debit is because of the scam the schools run. God forbid a student changes schools, the loss in earned credits can cost you thousands. Why is that allowed?

The Student loan program is extreamely complicated and mostly because of government regulations but there is one thing for sure the major issues in this market are not Lenders while I would agree thate there have been some lenders who give the industry a bad name those are not the majority and they have been dealt with!

I am a Democrate who voted for Obama and am very lberal on social programs but I have to tell you you have it all wrong…spend sometime and do some real research!

You get your electricity from a regulated public utility and you don't see CEO's of public utilities making $100 of millions of a year by profiting off of a basic societal need.

I have no problem with anyone making $100 million a year, but not at a detriment to society. And the only way to make sure society functions for the good of the people (and if you don't think that is necessary, please move to a cave in the mountains), is not let greed control the pricing and delivery of basic human needs.

And for no good reason. The FFEL program has worked for 40 years and, with a few modifications to reflect the credit crisis, will work for 40 more.

I could leave the country if I wanted to, since I have dual citizenship (American & Irish), but why should I have to live in exile when I've already paid back much more than I borrowed?

A man named Isaiah spoke these words over a thousand years ago:

"Woe to those who make unjust laws, to those who issue oppressive decress."

It's as true now as it was then. The student loan industry as we know it will cease to exist. We WILL have justice.

This would be consistent with Mr. Gilani's logic that overextended borrowers are in bad shape solely due to greedy lenders.

As a former Hedge Fund manager, I am sure Mr. Gilani is a very good judge of character.

This is another example of the government creating a problem, then coming in (as if it were a savior) and creating an even larger government bureaucracy to "fix" the problem.

In the end, it's all about control. They want it all.