I thought I was enrolled in this program when it started, and have been paying my student loans since December 2004 with a little less than $64k left to pay. My applications have been rejected too.
I moved from a wealthy northeastern state to a poor state in Appalachia to teach in a public college even though the pay was low because I believe in public education and in giving back through public service. My students are very eager to learn and some are just as brilliant as students at Harvard, Brown, and MIT. When they come to me for letters of recommendation for graduate or professional schools I take time to warn them that the student loan debt they incur might limit what they will be able to do in the future. I don't want to dash their hopes but I want them to be realistic about the burden of debt.
I don't have any hope my student loans will be forgiven unless Elizabeth Warren wins and Democrats take the Senate. That likely won't happen with the GOP still engaged in voter suppression, suspicious voting machines, gerrymandered districts, Russian interference, and the already wealthy supporting the status quo.
They've screwed my generation and the next, and frankly, they don't want an educated populace, just debt slaves.
14
"...the Pennsylvania Higher Education Assistance Agency, has been paid $1.3 billion over the past decade." If only a small percentage of applicants actually end up 'qualifying' for and receiving the loan forgiveness, where has all this money gone? Someone should follow the money and find out who is profiting off the program.
16
There is one thing that Bernie Sanders and I agree on: Free or very low cost education. The loan programs have dragged education onto low-road capitalism. With loan money flowing, schools can raise tuition. Loan companies and colleges, etc., make money. Profit now drives the well-intentioned student into a hand-to-mouth life in professions that we pretend to honor. Make education free! Find some way to start forgiving the outstanding loans and winding down this racket.
6
Teachers strikes in some of the most conservative states have been remarkably successful in getting anti-knowledge Republican administrations to bring programs up to 21st (well, maybe 20th) century standards. Perhaps a nationwide strike would convince DeVos that her department should stop trying to take American education back to the 19th century - starting by honoring the loan repayment guarantees that many teachers validly believe they are due.
2
We are from government, and we are here to help you.
How people could believe to what government promises in 10 or 20 years ahead is beyond me. Never happened, never will.
1
This could be easily fixed. Trump's government doesn't want to. This is consistent with Trump's defrauding students at his university and contractors at his hotels.
5
If you are providing critical public service work that requires an education that costs the same amount of money and time as much more lucrative professions, and your government has promised loan forgiveness after ten years, those loans should be forgiven. Period. Other nations do this well without even requiring expensive loans for subsidized education. Do you want teachers in inner city schools? Do we want people to clean our lakes and rivers and maintain natural spaces? Do we want doctors and nurses in rural areas? Do we want lawyers who help poorer people? Do we want career civil servants who aren't corrupt? Because no one in their right mind is going to do these thankless jobs unless either college, housing, and healthcare becomes a lot more affordable or salaries become a lot more commensurate. And why does some corrupt private loan service get to manage a public program in a corrupt manner with no credible oversight by DeVos' anti-Education Department?
17
I am an academic, and I would support getting rid entirely of the Department of Education. They are mostly a pas-through organisation, and have a long history of poor oversight of what they oversee. All eyes are on them with the debt relief fiasco, and yet this still exhibit incompetence beyond imagination.
2
Incompetent - lacking of the qualities needed effective action. That is from Webster's Dictionary, even I with a high school GED can understand that. Seems too many lawmakers and program directors do understand this word.
A teacher can not effective teach our children when burdened by overwhelming debt. Do we care about quality education?
5
The program was no doubt well intentioned but it has been subject to abuse. I know of law school washouts who took jobs as legal assistants in State government with the hope of gaining loan forgiveness. They are not teachers or social service workers, they are slackers who want the rest of us (ie taxpayers) to foot the bill for their wasted and ill considered educational choices.
2
Why would Congress have put a junk private/for-profit agency in charge of this program? Seems like more and more public interests are being flitted away into private hands by our very public officials.
3
Can you really blame government? Why is education so expensive to begin with?
Just last week, Fedloan told me I had 21 qualifying payments when I have the paperwork (from them) to prove I have 109! They promised to set up a “review”. I am not reassured. I call them quarterly to make sure I am doing everything correctly, yet they still can’t get my case right.
They also recently refinanced/restructured one of my loans without informing me, or even getting a signature. Is this legal?
I am beyond frustrated with Fedloan. And I don’t trust they will honor the PSFP. I have ten more payments. Keep your fingers crossed.
10
(Last week, 21 attorneys general — including one Republican, Lawrence Wasden of Idaho — filed a brief supporting the union’s position.)
Why do so many average Joes, or Josephines, continue to vote for a party that cares nothing for them (only one GOP AG?)? If you aren't already well off they not only don't care about you but continue to do all they can to keep you from getting there.
4
Same as immigrants who were told if they served in the military they'd become citizens. They served. Then were deported.
We lie to people.
We break promises.
What a country!
9
For being a self touting Christian, Betsy DeVos personifies everything a Christian isn't. Why doesn't she take some of her millions and do the Christian thing and help some of these people in these public service jobs and pay off their loans for them?? I guess forgiveness doesn't figure into her version of Christianity.
4
Trump, you gave out $1.7 trillion in borrowed money to the richest people and companies in the country INSTEAD OF KEEPING A PROMISE. Every young person who was hurt by the promise, their friends, parents and family, and employers need to vote the bum out of office and retire DeVos.
3
My wife decided she could “afford” grad school — and has specifically taken lower-paying nonprofit gigs for a decade — because the loan forgiveness program existed. She’s also paid less on her loans per month than she could’ve afforded to, specifically because she was told to do so to remain within the program’s guidelines. If the program renegs on its promise, she will have spent many of her prime earning years making less than she’s worth... and will still be saddled with *more* debt than she would’ve been without the program.
Multiply this by tens of thousands of people. It’ll be a national disgrace. All involved should ashamed and f this isn’t figured out, and soon.
5
The headline and the body of the article are full of references to broken promises; yet never mention the broken promise at the heart of the problem; the promise that the students made to repay the money they borrowed. And yes, I am currently repaying student loans I took out and will continue to do so despite the fact that I would rather use the money to get "coffee from a cafe".
When one signs an agreement to borrow money, the lender has an obligation to give them the money, which happened. The borrower has an obligation to repay the money plus interest, which is being avoided. Whatever the law may say on it, there is a moral obligation to honor one's word. If the lender changes the terms, that is wrong. It is equally wrong for the borrower to do so.
1
The fact seems to be that the lender has broken their word here, and has at least a moral obligation to honour it. Graduates were tricked into accepting jobs with lower pay but crucial importance to your nation, such as teaching, with the promise that if they stayed in those jobs for 10 years and made repayments during that time, the remainder of their loans would written off. Americans need people to become teachers, and how many people will agree to do so if the government breaks its promises to help them?
11
I consolidated with Fed Loan and joined this program in 2011, with $81.5k in principle debt and 6.68 APR. So far, I have paid upwards of $44k, every monthly payment on time, and my principle is now $81k. It's crushing to see the principle higher than the original balance, but I keep trudging forward.
Every year I recertify my employment and reapply for income-based repayment using my tax return information, but the new payment amounts don't match wage increases. I received a 2.5% raise last year (nonprofit work) and my monthly payment went up 20%. This paralyzes my ability to save for retirement, emergency savings, or a home downpayment because I have to assume that next year's monthly payments will be 20% over this year's (I got a 3% raise this year).
The ONLY THING that keeps me sane through this process is the idea of forgiveness happening in a couple of years. If this program dissolves, I don't know what I am going to do.
16
@Adriene You'll be fine when it comes time to apply for forgiveness. Consolidating in 2011 was the right step, and kudos to you for paying attention early in the process. If your salary is low the payment increase can be a larger percent because no payment is required until your salary exceeds 150% of the poverty level. Check out one of the calculators online to see what the impact might be - the formula isn't complicated.
2
The average debt of college graduates is $35,000. To pay that off in 10 years would take $400 per month. If you can get about $15 per hour you will make around $30,000 per year. you should be able to manage those payments, but it will be tight given the cost of living expenses.
Students should not attend schools that will leave them in debt above $35,000. You can work during school, extend the time it takes to graduate, etc. Most traditional aged undergraduates have no idea what debt is like. Colleges that leave undergraduates holding more than $35,000 debt are immoral.
7
@cheddarcheese One year's tuition, room, board and fees are $45K per year for state residents at our main University. That's double what it was a dozen years or so ago before former Republican politicians (now three in a row) have been selected by the Republican Regents to be the University's President (for sure a sweet deal for a politician to be retired into a university presidency by one's politician pals...great seats at all the games, a free house and cars, and a golden parachute retirement...almost as lucrative as being Head Football Coach.) Add a few thousand per year for a degree from the Business or Engineering Schools. Granted, you can save money by renting each textbook for $100/semester rather than buying them for twice that. Oh also...add $10K if you're a resident from another state. Who and what family can afford this and borrow only $35K over four years, especially with accruing/compounding interest of 6-7% annually? Like everything in America...follow the money.
6
This program is working as designed. The problem has been in poor communication from servicers and poor understanding by the public, who apparently thought they could have their loans forgiven without even bothering to read the requirements.
No evidence has come out that Ed is rejecting qualified applicants, and I am fully confident that we will be approved when we apply in several years. Because we read the rules and followed them!
1
Read Chris' letter which is the third down from yours. "Grotesque incompetence" seems to be what is shown by the details in his letter and in the article. If I were you, I would be very worried about applying for this debt forgiveness programme.
1
Once again, I am thankful to live in a land with the dreaded "social education". My son's tuition to engineering school: CHF 800 (about $820) per semester. He is getting a great education, has no debt, and very good job prospects. It is possible, the government has to realize that low-cost tuition makes sense for society.
15
"That servicer, the Pennsylvania Higher Education Assistance Agency, has been paid $1.3 billion over the past decade."
.... so they cashed in 1.3B to pay out what exactly?
They need to be held responsible! 23% mistakes and they are still not fired?
No student should have to pay a 7% interest rate - that is robbery!
As much as I support Obama, I did not understand why he bailed out banks, but did not declare predatory loans (mortgage + students) illegal and open for instant refinancing at a regular market rate.
12
If you have not been accepted into the loan forgiveness program: Rejoice!
This is the most ineptly run, morally bankrupt program I have ever encountered. These grotesquely incompetent people lost my application three times, delaying my entry into the program for well over a year. Each time I was treated as if I were the one at fault.
When they finally began to officially count my time served, I was promised that their fault for the delays would be considered and that my earlier service would be counted. They lied. I ended up working more than 3 years for a 2 year service agreement, but as I was to learn much later, with only 15 months counted toward repayment.
10 years later I was contacted by the program and informed I had to return to work - 11 hours away from my home, family and now established career that I could not possibly, sanely walk away from, to work for 18 dollars an hour (with a house mortgage and family!) until I served my 'missing' 9 months.
I of course offered to simply pay off what was due. The amount? For the missing 18k (that I had actually repaid through work) they declared that I owed 160 thousand dollars! "Penalties" I was told. Any lender outside of the government that charged such penalties would be charged with a crime.
I had to sell my home in order to pay off this loan.
Deciding to apply for this program was the single greatest mistake of my life. This program should be eradicated.
Dr. Christopher Smith, Psy.D., Florida License: 8387
18
I’m appalled and enraged hearing this.
8
@Chris I'm sorry this happened, but you have the wrong program. This article is about PSLF, not the health service corps.
A loan is not free money. It must be repaid. Congress should have NEVER created a forgiveness program; it never had to be this complicated. When debt is forgiven, who pays for it?? It creates problems for the entire society because the debt shifts to others who diligently pay their bills.
Furthermore, how on earth could anyone assume government would pay off a private bank loan? Even if the loan was administered in conjunction with a federal program?
At the very least, Congress could reduce the interest rates on these loans and provide small subsidies, as in Obama's Home Affordable program. But a debt jubilee? Bad idea. Extremely gross mismanagement and negligence of a good thing for students. Par for the course. Greed and corruption are twin evils devouring America.
2
This program/law should have never been instituted. The government should never be involved in any kind of loan repayment programs. (Bailout come to mind?) I have seen how students use their loan money and it is not responsible. They eat out frequently, they buy new cars, they live alone, and they attend expensive schools. (Obviously, there are some responsible students.) If you borrow money, you should plan to repay it, PERIOD.
3
That 7% interest on these loans seems punitive in this day and age particularly for low earners.
12
What an outrage...corporations get boatloads of tax incentives that allow them to zero out their tax bill yet a government debt forgiveness program intended to bring disadvantaged areas of the country some educational and other professional services turns out to be a scam?!
And all along, the government was aware of the inept and callous setup for the program to work effectively. How do we ever get accountability for the utter failure of the legal development of this scam as well as the governmental oversight that should have put a red light on this years ago? Who is in charge? I want names....from its origins to present day....
5
Another reason to not have children.
7
Medicare for all, anyone?
2
Twenty-seven million paid to the people targeted to get the funds, and One-point-three Billion to the loan servicer. That's billion with a "B."
12
Feel sorry for the folks who got ripped off. But as a taxpayer, who paid off student debt, I have little sympathy for folks who attended colleges they couldn’t afford and now want the government to pay off their loans. The real villains are the excessive tuition fees universities , including state and local community colleges, charge for the privilege of attending. Today’s students will protest any issue that doesn’t fit into their social injustice mentality. Why not begin a national campaign to demand their colleges to justify, and reduce, the outrageous amounts of money for their higher education?
5
That’s not the point. Here. Specific low demand/high need employment was held out as qualifying for loan forgiveness. If the employment was performed and the loans otherwise paid as contracted, the Congress needs to live up to its bargain. Of course, even this matter of fundamental fairness will not get attention from the do-nothing Pelosi House of Representatives.
3
@Truthbeknown Ummmm, the "do nothing" House has passed several hundred bills which are now piled up on Mitch McConnell's desk. If and when they pass one related to this, I can assure you that is where it will end up.
2
It appears the only entity profiting from the loan forgiveness program was in the private sector company put in charge to manage it. Big surprise.
11
I am enrolled in this program, but not in an income driven repayment plan. I have never missed a payment and pay more when I can. Ever since Devos took over, I started getting regular calls and mail encouraging me to switch to an income driven repayment plan because otherwise I would payoff my loans by the time they would be eligible for forgiveness. I found it very suspicious that a lender would encourage me to pay less so they could forgive the debt later. I do not trust Devos and so I thankfully continued to pay as I had been. I have no faith this will ever be worked out. It’s a shame, because for many they are only going to end out in deeper debts because they switch payment plans with the confidence the debt would be forgiven.
60
@Meghan P
Devos's family became filthy rich from what was essentially a well run and legal pyramid scheme (Amway). It's fun cheating those who can least afford it.
5
@Meghan P While you may not trust Devos it must be noted that these issues developed long before anyone heard of Devos.
4
@Meghan P I agree it is very suspicious that the required payment would be so low which makes it impossible to pay down school loan debt. I have been paying for about 7 years and my loan principal has not been reduced because I only seem to be paying interest. FedLoan is making a big profit by requiring borrowers to pay a low monthly payment.
3
This sounds like a government Ponzi scheme. The rule needs to be simply changed....the purpose was desired employment and if that has been served, the loans need to be paid. The United States spills more money yearly than this program would cost to clean up. Going forward, clarify the rules and hire a servicing contractor that applies the rules in a transparent fashion.
3
Those who are compelled to encumber themselves with student loans are getting an education from the process: it's a reminder that in America, nothing but profit matters. One's word is as meaningless as the soon-deleted text messages consuming everyone's attention but the debt and its service remain. Our priorities are giving the very wealthy ever-larger and more permanent tax breaks, by way of making them an aristocracy of money, while those of lesser means groan under an ever-increasing burden of taxation, let alone these monstrous devices called student loans.
51
They need to expand the list of payment plans that are eligible for this program. Many of us were given incorrect information by our loan servicers. The Dept of Ed was not reachable in the days when I inquired about this, forcing me to reach out to the loan services. It seems like a conflict of interest for the loan servicers to be communicating this information to borrowers, and it seems like Dept of Ed was shirking its duty by not making the rules of this program transparent and readily available to borrowers.
4
If you can't afford tuition go to a cheaper school, don't expect a socialist government to cover your poorly forecasted debt.
3
No matter what you think about the actual program, people should not be lied to for a decade. If the government doesn’t want to help them with this, fine, but then don’t lie to people for 10 years about it. Tell them up front so people can decide maybe I don’t want that public service career BEFORE they spend all the money.
20
For most applicants, the decision to take a “public service” career came after incurring school loan debt. And for most, they were lucky to land the jobs they got. Sorry it didn’t work out. Teach your children not to incur debt that will cripple their finances as adults.
Betsy DeVos; woe betide the billionaire who steals people’s labor. No lower form of life exists on earth.
10
The stumbling blocks to fixing the education loan forgiveness program are the blockheads Betsy DeVoss and Donald Trump. They are not champions of education and public service, and are dedicated to exploiting the poor, rather than helping them. As long as they personally derive benefits from the Trump tax- reduction-for-the-rich scheme, government programs are working just fine.
11
Who is to blame? Obama AND Trump administrations. This has been broken for a very long time. DeVos does not get a pass just because she didn't start it; she can, however, fix it. Why do you think I don't believe Warren's "free college for all" will work? Ha!
5
Coincidentally, Betsy Devos has been held in contempt of court, and accused of self dealing on this issue.
Will Congress do anything about it?
5
What's so confusing here? Apparently the Pennsylvania Higher Education Assistance Agency appears to have pocked the money and are hiding behind bureaucratic rules to keep it. Or am I wrong?
13
If you're a big bank, bailouts are no problem. If you're a taxpayer trying to make it in this corporatocracy, forget it.
10
This is why we need Elizabeth Warren in office. She would never allow this happen on her watch.
6
I see the Education Department under DeVos is eager to "help" by creating new obstacles to forgiveness that are not in the law.
5
Is it more disgusting that this happened through incompetence or through deliberate design and sabotage of the program so it would fail? In either case, our government does not monitor how its programs are working or try to fix them when their failure is obvious; this too can be either incompetence or deliberate sabotage.
In this case, those who ran the program poorly still made money, and the program had so many features built into it to prevent people from unduly taking advantage of it that it prevented virtually everyone from using it. And as this became obvious, nothing was done. If those damaged had been farmers or financiers or affluent people rather than struggling debtors engaged in socially useful but poorly paid work, the program's failure would have been noticed.
We defend ourselves from idealists and do-gooders by giving them enough obstacles that many burn themselves out.
4
Reading this story made me sick.
This is the United States isn't it? Where we understand that education is the golden key to personal advancement and the enhancement of our society?
Betsy DeVos as Education Secretary is less than worthless. Anyone who has paid attention to her efforts to not help people who want and need a good education should not be surprised.
There is no doubt if she was committed to her title - (Education) she would have fired the incompetent loan servicing company (that is making billions) long ago, and stepped in to help these hapless victims.
Instead, she is very happy to either (a) do nothing and let victims twist in the wind, helpless pawns against her department and a huge loan servicing company or (b) have her department issue more barriers and confusion to route victims back to (a).
I really just cannot wait until a Democratic president is elected and she sweeps out all this greedy, rich, incompentent people that contibuted to trump's campaign and in exchange, he has gleefully appointed.
Vote Blue, No Matter Who!
10
Direct Loan servicing should NEVER have been moved from Albany, NY, to that quasi-governmental institution in PA. That’s all I’m going to say. Get into the politics of why that happened and you’ll get close to the true problem.
9
Let me guess, someone somewhere got very, very rich off of this.
4
Thank you, America! Such an amazing capitalist country.
1
There are 80,000 borrowers affected. A boatload. But I checked and there are more than a million in the program who should eventually qualify for $93 billion of forgiveness.
I don’t feel informed until I know the big picture. In particular, I now know that this is a disaster but far from a total disaster. The information about the overall program is simple to find. It’s the editor’s job to get it included. And it should have been done unless he or she preferred that it seem like a total disaster.
3
This article is serving as a warning for those who have yet to reach the application stage. Who says any of that $93 billion will actually be forgiven with all the loopholes and roadblocks listed in this article?
1
A perfect example of good intentions bogged down by poor and complex execution. Laws should be written with execution in mind and made as simple as possible. Instead, due to politics, bureaucracy, and simple ineptness, complicated laws are put in place that sound great when a politician speaks of them but do absolutely nothing to help the people they were meant to unless those persons hire a lawyer to help them decipher whatever garbage was written. Very sad state of affairs.
My wife was using this program to try to pay off her loans. FedLoan was so painful to get any information out of them on their website or on the phone. Also, even though my wife had worked for 5 years and paid monthly loan payments to , FedLoan said she only paid about 1.5 years worth of payments. To say speaking with FedLoan about this was worse than pulling teeth is an understatement. Also had to submit paperwork to FedLoan yearly.
We came to the point where we said if we wait another 8 years or so , we may save about 3k or so than if we just paid the loan off now ONLY if the loan was forgiven at that point. We thought the chances of that happening based on our conversations with FedLoan were slim to none and even if the loans were forgiven at that time, the stress of getting them to forgive the loan wasn’t worth it. Luckily we had funds to off the entire loan. Very sad we had to way paying more now than dealing with more stress and possibly not getting the loan forgiven later.
3
Wait, did I read this right that the government paid a company $1.3 Billion to give out $27 million in loan repayments? If so seriously scratching my head.
12
The only ones having a profit and a benefit are the bankers, because those loans with 6-8% interest are not going to be paid by the majority of people but they are guaranteed by the government. It is a system designed to transfer an incredible, cosmic, amount of capital to the banks and throw people into servitude. You can buy a house at 2.9 interest but you have to go to school at levels of debt and interest that are not remotely payable. We are going to have emigrants to Europe and Canada very soon, to escape debt slavery.
7
America is becoming a 2 tiered society thru sharply contrasting access to education.
George W. Bush bragged about his poor performance at Yale, and was only accepted because of his father. As president he started a war in which we are still tangled and many poor young men and women lost their lives ... Trump, not much better.
At the other end of the spectrum is the sorry state of public education today. Public education is funded primarily thru local taxes, so poor districts are at a disadvantage. Over the past few decades, cutting taxes has been the mantra of many in government, so funding for public education has plummeted.
The rich can send their children to private school, sometimes receiving tax benefits.
Unequal education, unequal career opportunity.
The people in this story worked very hard to bridge this gap, living frugally in order to pay for their education. If they are
treated as poorly as this story describes, our nation is in trouble.
7
The purpose of this program was to entice people to go into necessary, low paying public service jobs who might not have otherwise done so. They made trade offs based on a premise and while society gained they did not as was promised. The system was opaque and the Dpt of Education has failed to do its job to rectify this. With Ms. DeVos and her cadre of staff from for profit diploma mills no surprise. One could probably chase the money trail for the processor and find the usual crowd. Aside from that I knew before looking at the comments I would find the usual moral hazard, guvmnt bad, right wing posters. Who merely repeat the lines they are given by Fox and the rest of the pap. I am lucky to have none of these people as friends or family. I feel for normal people who had to deal with them at Thanksgiving dinner. They are empty minded, hard hearted people who care only about themselves and not as some of the people quoted in the article about the society or the country.
8
Perhaps the Education Department can hire Hank Paulson to bail out the students. He managed to dole out $700 billion to bail out Wall Street with exceedingly few requirements, all of which were, apparently, very easy to achieve.
10
Why isn’t Betsy DeVos mentioned enough here? As Secretary of Education and personal stakes in student debt collection firm.
Do t forget a federal court judge found DeVos in civil contempt for failing to stop collecting on some of the loans and fined the Department of Education $100,000.
How is she helping the people?
8
She is not. She was put in this job for the purpose of not helping people.
3
Someone has to pay these loans. The idea that the government “pays them off“ is nonsensical.
I worked my way through college. I borrowed money for my masters and law degree. Both sets of loans are paid off.
With this government “bail out“ I’ll be paying someone else’s loans off through taxes. 
Of course, the government doesn’t have enough money to pay its own bills but that’s another story.
3
Congrats on your success. But with that in mind, one hopes you’d be willing to help out others less fortunate.
5
I wonder by your comment if you’re of the older generation (like me). Surely you’re aware that college education is a lot more expensive than it used to be. Instead of a reasonable debt that can be paid off in 10-20 years, kids these days are saddled with a debt they can’t manage with entry level jobs. It’s great to say “I did it, so can you” but you’re placing blame on the victim. Colleges/universities are charging WAY too much while sitting on massive endowments. They are more focused on revenues than education IMO. THEY need to address the problem.
5
This program was put into place to get people to take careers that we as a society desperately need, yet are poorly paid. Otherwise, who would choose a career knowing they will be a debt slave their whole life?
3
It makes sense to me that the children of career teachers be given special assistance in paying for college. In addition to financial aid colleges should give preference to the children of teachers
4
I work in public education and the INITIAL documents related to “loan forgiveness” stated that having your loans on auto pay, making 120 consecutive payments with initial eligibility date being a determined time in 2017. I previously had consolidated my loans years earlier and extended the payoff date from 10-30 years at a lower fixed interest rate of a 3.25%.
When I contacted the the administrator of the Public Service Loan
Forgiveness Program I was essentially told that eligibility for the program required no modifications in the initial terms of the loans, which in my case was TEN years at over 5.5% interest rate adjustable. You can sense that I broke out in derisive laughter by pointing out that would mean almost no one would be eligible for “forgiveness” since ten years is the term of most loans. The individual who I spoke to said , yea the only people who probably qualified was those with income based repayment plans.”
Too bad I didn’t record my phone conversations or save ambiguous documents posted by the federal student loan on their web site in regard to this program.
10
Oh and about that auto pay thing-they manipulate that to keep you from doing it too. They took $1500 out when they should have taken $250 out, dragged their feet in correcting the error (meanwhile no money for food, rent, utilities). then two weeks later did the same exact thing again. So in order to keep them from continually emptying the bank account and causing rent, utilities checks to bounce, we can’t use auto pay. They cannot be trusted.
3
Always remember, when bankers, "businessmen," and the connected need a helping hand it's heralded as good business. Giving them no-interest loans with liberal terms or the option of bankruptcy to discharge the debt is perfectly fine.
But, when you or I as individuals ask for debt-relief or, in the case of student loans forgiveness, it's called "moral hazard!" Has an ominous ring, doesn't it?
Here's the truth: banks and financiers will never allow loan forgiveness. They will never lose a penny on any transaction. A solution for the student loan situation is to ensure that bankruptcy IS and option. Then, the banks would be forced into a spot where they would have to make real business decisions rather than function as low-life, loan sharks.
12
@mrfreeze6 the problem is that most of these loans are backed by the government so even if people could declare bankruptcy they would not have to pay
Lisa
This article paints a picture that is only half-accurate. It does not speak of the fact that physicians are eligible to have their loans forgiven in this program. While the program may be mismanaged, the design is also flawed. High paying professions should never have been included. Doctors don’t need loan forgiveness, especially if they’re working in non-rural locations serving middle/high income patients.
This is not always true. Yes, they make a lot, but they also have to borrow a lot. And some of them do work in underserved areas.
2
“A federal loan forgiveness program made a promise to students: Stick with your vital but low-wage professions and your debts will be wiped clean. Then they weren’t.”
We have to educate our young people that if a “profession” does not give you a middle class wage, then it should not be pursued. In 1991 a beginning teacher’s salary in CA paid for an apartment at market rate, 100% paid health care for the teacher and dependents, a pension upon retiring, a little extra cash that could be saved or used to further the teacher,s education in an evening program without taking student loans. After saving for 5 years, the teacher could buy a house. Our society no longer allows for this and in America there is no respect for being poor; therefore, those who pursue “ vital” low wage professions for whatever reason have their self respect and dignity stolen from them. Our country does not deserve the talents of these young people and until our priorities change we should do everything in our power to dissuade young people to serve.
8
@Sonja —so then we should have those highly qualified high school graduates another poster spoke of serving as teachers and social workers??
Maybe the 1.3 billion paid to the agency should have been instead used to retire the debts. Sounds like welfare for a bureaucratic agency instead of debt relief for those intended. What am I missing?
9
One wonders if universities have decided to charge higher tuitions based on the government’s apparent promise to write off student loans after 10 years.
Has any non-partisan entity looked at how universities spend their money?
4
It’s too easy for students to over-leverage themselves to pay for their education. And- much like the housing crisis- the investment isn’t really worth what the borrowers thought. The impact that’s having on our economy is deep and troubling. It’s helping shift wealth to the few as people with student loan debt struggle to amass wealth and save for retirement. It’s a factor in our falling birthdate- another stressor for our future economy. Better to write these loans off (why sweat the small stuff if Congress has only used 4% of allotted funds?) and limit future lending. Put the onus back on states to finance higher ed- and provide alternative and affordable paths for students to be career ready.
@Rachel
Here's an idea: how about you write your elected Congressperson and ask them what the cost of writing off all of those loans would be? I guarantee you it's far more than the 700 million which the Congress has reserved.
2
The real winner here is the Pennsylvania Higher Education assistance agency, paid $1.3 billion over ten years for actually forgiving only $27 million in debt. Seems like it would have been better to not pay them and forgive more student debt!
4
But that is indeed always the case, and something that a couple of other respondents spoke to. Using the 2008-9 recession as a prime (no pun intended) example; imagine if those billions/trillions were instead literally given to the homeowners that lost their homes. First of all, it wouldn’t have been as much money. And of course, People would say, but there’d be so much corruption... heh, ok, it’s clearly a large part of human nature’s dark underbelly. But I think it’s easy to agree that while we’d of course have people scamming and/or gaming the system, it wouldn’t have amounted to anything near what the big banks were able to accomplish as they were actually writing the laws and policies to benefit only themselves.
I mean, is it really so hard to see the difference?
6
I remember when this program was announced, and my sympathies go out to the people now being stiffed by the government. Until Washington brings integrity back to its governance for the electorate who put them in their jobs, we will not make this country whole again.
We’ve all seen the government not make good on its promises, and it is usually met with a shrug. But this is especially egregious. I don’t expect it will be sorted out with Trump, DeVoss, and the rest of his cabinet of people chosen to dismantle the departments they were appointed to run.
4
In 1960, while at university, I took out a federally sponsored loan to help pay tuition. For each year I worked in a public service job 10% of the loan would be forgiven, up to 50% and I wouldn't have to start paying the balance until either I left the public sector or reached the 50% limit. Easy.
I taught middle school for five years (actually more than that) and watched as the balance on the loan decreased until, five years after I graduated, I owed 50% of the original loan. Promises made, promises kept.
The struggles of young people today shock and sadden me.
5
And people wonder why young people don’t start families and still live in their parent’s basement.
2
The solution isn’t more government workers that don’t do any work outside of campaigning every other year. The solution is for the government to exit the lending business entirely. State Universities and community colleges would continue to be affordable without student loans and private schools would truly be private, and not subsidized by Federal Student Loans that will never be repaid.
1
The solution is laws and policies written to benefit We The People instead of the banks and corporate loan givers. Vote, people!
4
Except that even people at state colleges have these same loans. Sure they aren’t as much as a private school, but they are still crushing.
2
Let's not forget the loan servicer, who makes money servicing (collecting payments etc.) the loans. When a borrower is no longer being serviced (their debt is paid) the loan servicer loses a source of revenue, income and profit. The loan servicer has a powerful incentive to keep borrowers from paying off their loans.
7
One problem, as I see it, the failure of the government to handle its own program. Farming it out to a private entity was bound to create problems because that entity lacks even the somewhat remote connection to the program a government agencywoudl have. I benefitted from a federal loan program that worked—the money came from the government and It administered the repayment (which mostly disappeared). The premise
of the part of the National Defense Education Act from which I benefitted was that if you taught at a school for low-income students, you would get part of your loan canceled each year until, after five years, it was all paid off. Worked like a charm. At the end of each school year my principal signed a certification that I had completed another year of teaching at the school, which the principal annually certified was indeed federally designated as serving low-income students. After five years my debt was gone. They system worked because the government was the lender and handled repayment. As the obsession with privatizing government services has mushroomed, programs like the one I was in have vanished so that private entities, some profit-making, some non-profit, have taken over,much to the disadvantage of students participating in them. We need to bring back a clearly defined federal program—whose purpose is to aid students and bring them into contact with useful jobs that need filling.
26
@Bill Rogers
NDEA loans did work pretty well, but the government was neither the lender nor the servicer. What the government did was to provide capital to schools which wished to participate in the program. The schools then made loans to their students under federal guidelines and serviced the loans when they went into repayment. Repaid funds went into a revolving fund at the school and the school made more loans. The feds were just a cash cow.
1
Because of the absurdly high interest rates people have to pay on these loans, the failure of the DOE to run this program well is beyond atrocious. How many of those who have been denied forgiveness have already paid back the equivalent of what they borrowed?
18
I’m on this plan and have paid $45K into the program, $4500 of which was towards principle. So, yes, I’ve paid almost double my debt but have made no mark on the balance.
28
@Adubs this doesn’t seem right. If you have a 20 year loan at 8%, you total debt cost will equal your principle (ie, total payment = 2x your loan). If you have a 25 year loan with a 6.5% interest than your total payment is 2x your principle. Federal student loans have rates around 5 to 7% fixed. I think you need refinance your loan.
We need to implement a write-off plan for all four year college debt. Those who within the last number of years have paid off their debt would get some reimbursement. There is a reasonable fair way to unwind this mess and terminated government coerced student lending. After that, college costs need to be lowered so no substantial debt is needed to attend a four year public college.
8
Sad. I remember what a godsend this program seemed like in law school. With law school at $200k now, this is literally the only way most of my classmates could “afford” to work for the government or a non-profit (unless they had wealthy parents). A good number of classmates made career decisions based on this promise, and they will be utterly wiped out without forgiveness. For the crime of being a public defender or working at a legal aid clinic helping the less fortunate. I went to work for a big firm and paid my loans off years ago. Welcome to America, help those in need and be punished, be a greedy capitalist doing socially negative work and you will be taken care of.
78
Absolutely despicable. 10 YEARS these people have worked and lived under frugal conditions, goaded by private loan managers only to be rejected or worse restarted under a new 10 year clock. We truly have an abject government. Make tuition free or properly pay these public servants a living wage. These are critical roles in our society!
46
Give teachers a raise! How is it that we are not rewarding those who educate our children? Is this not a priority for our country? We entrust our young minds to these public servants all day! They teach our children how to read, math, science, history and so much more. It’s embarrassing how little we reward them. It’s obvious that taxpayers are willing to pay out more otherwise private, charter, and/or coop schools would not exist.
2
There’s a lot of necessary, low wage careers where people desperately need raises.
1
Wow. This Pennsylvania Higher Education, etc, outfit "failed to adequate track" payments, etc, etc, etc. An auditor I know told me that this sort of thing can mean incompetence, or... it often means fraud, with the so-called confusion and chaos creating a fairly effective smoke screen. Leaving aside all the other problems with this programme, I want to know what are they doing with that $1 billion dollars they are in charge of? Not using it to write off much student debt, clearly. So there's an idea for a Times investigation right there.
34
@Lisa
Oh, Lisa, ye of little faith. The PHEAA spokesman has assured us that the agency "believes in the program". How nice to know that they believe in the program which pays them so handsomely for their incompetence.
But then, their competence or lack thereof comes as no surprise to some of us who live just down the road from them.
3
I watched my husband do everything in his power to qualify forgiveness and it still failed. He paid every payment on time since 2002. In 2007 the program started and he thought he was doing what he needed to. We aren’t saying he shouldn’t pay back his loans but part of the deal was that he had to working in certain areas in order to qualify. He is working with people who are often dangerous and who have been in psychiatric institutions much of their lives. That was established as the type of work he had to do to qualify. When he applied last year he was told he didn’t qualify because he hadn’t paid the right amounts. He didn’t choose his repayment plan - the loan companies did. His loans weren’t extravagant but it was still a significant amount. When the program denied him they said he should pick a new repayment plan and start the ten year time period over. This is outrageous. He is 66 years old and certainly cannot start the clock over. As far as I am concerned this is nothing but lies!
54
My SO is in the same boat. He’s 61 and spent a lifetime caring for people with developmental disabilities, some of them who were violent.
1
You’re supposed to be submitting paperwork every year to verify that you are on track. That is very explicitly stated on their website. There’s no reason people should be waiting ten years to verify that they qualify for the program
6
Verifying every year doesn't help when the rules seem to change at the end of the game.
28
I’ve been in this program since 2012 and the rules haven’t changed. But I also consolidated into direct loans like the website explains.
1
So many federal programs are bogus handouts to bureaucracies. This is why the more categorical promises of sanders and warren make sense.
6
My wife spent ten years foregoing a lucrative suburban teaching career with ridiculously good benefits to work for a non profit for lower wages and no pension. At least the alleged student loan forgiveness was going to be a small offset. Nope, she was informed she had the "wrong kind" of loan.
After we found that out, we took a five year break from any unnecessary spending and paid off everything, student loans first, and with the furious momentum gathered from that, credit cards, two cars, and a mortgage.
We took the feeling of being betrayed by our government and built a personal legend of freedom from banks. We free climbed our own Dawn Wall of debt. We were debt free in our mid thirties and we owe it all to the fact that we got hosed by Dept of Ed. When you find yourself left out in the cold, see if you can make a debt snowball.
20
retired attorney F/71
It took a father who is a CPA and me, an attorney doing federal legislative work, to get two PhD-level Physical Therapists properly enrolled with qualifying loans. And then repaid with years of low-wage work at military bases in Japan and in Louisiana.
How many of these diligent followers of wrong or changing or scrambled directions from program managers have access to free CPA/attorney guidance? A handful?
I'm with the person whose comment here says Congress needs to revisit this program with a one paragraph fix to cancel all debts.
All of the legislation I've written and Congress enacted over 40+ years was short and clear, never a court test to determine what Congress intended. Here is a start for the House committees with jurisdiction:
"All those who enrolled in this program from its first day of operation and can provide any evidence that they made any of the required payments shall have their loan balances cancelled in full. Principal and interest accrued shall be cancelled. In all appeals of denials, the petitioner/loan payer shall have a presumption of qualifying for loan cancellation. The burden to show an individual is not eligible, to justify denials, shall be carried by the administrator and Department of Education."
Time to make Congress fix the ickies and spend appropriated relief dollars.
22
I’m in the PSLF program now, enrolled with FedLoan. In the year I have been with them I have experienced two major errors made with my loans and no response or corrections made once inquiries and requests for corrections have been submitted. I don’t know what to do. Is there an advocacy group or legal program I should contact for help?
12
I tried my governor’s office. Though they would not confirm any litigation there was suggestion that the state is looking into the program on behalf of borrowers. They have already sued Navient and are passing new laws to protect students. Supposedly I have 6 years left. I will have paid all that I borrowed and still have an astronomical balance remaining.
8
I’m in it, too. You have to be ON TOP OF THEM and ask for email confirmations of conversations. They take a long (real long) time to fix anything, but they will. It took 8 months for them to “review” and fix one error on my plan, which was 9 months of uncounted payment because I had a “balance forward” - I paid a little more than required one month.
1
@Rebecca Cohen
retired attorney F/71
Find my comment here and take this NYT story, my comment, and your issues with the program administrator right now to both of your CA Senators and to Spkr Pelosi with a request to route your information to the House committee(s) with jurisdiction over the Dept of Education. End each cover letter to Members of Congress with your last two sentences here married: "I don't know what to do or where to go to get reliable information."
Show a copy going to and do send copies to the program administrator's top manager.
The number one person in your program's organization is the person who will get the Committee's subpoena. No more trying to communicate with clerks or computers!
Now breathe and eat something yummie to get your dopamine burst to calm your brain and body?
1
Education Secretary Betsy DeVos has no interest in aiding loan forgiveness. Her travesty of administration of her Department has the absolute worst administrative record of any Education Department in the history of its existence. She could fix this problem and save everyone a lot of time and money, instead of being sued constantly for incompetence and malfeasance. DeVos is not only unfit for her job, she is mean and mercenary. Her real clientele is not the American people, it is the for-profit education industry that itself has a wretched record on all fronts. Anyone who wants to see this problem solved had better vote Trump out of office, because DeVos is not going anywhere as long as Trump is in power.
21
If only students were corporations.
If only students had selected New York City real estate baron daddies.
If only students had paid lobbyists working for them.
26
Okay so everybody recognizes there's a big problem and the nature of past mistakes. What I want to know is what are they going to do about it? This is exactly the kind of thong that undermines citizen faith in government. It's no wonder people won't vote....we already know bankers are interested in only one thing.
6
OMG...sweep my floor. Is this what we ask teachers to do now?
“I would do it again if it meant that at 3:05 p.m. every Friday, I can stand in my classroom and sweep my floor, with a great week behind me and another one ahead,” Ms. Finlaw said. “I am not the one that asked for this program. I didn’t dream it up. Someone promised it. All I did was believe it was real.”
14
@Terry Erickson what is your point?
@Terry Erickson —I see it as the teacher’s equivalent of clean one’s desk on Friday afternoon so one starts the next week in a good place.
I am a boomer who benefitted from a Dept. of Labor program that paid for my graduate school tuition in exchange for 6 years of service to a non-profit or government agency. I put in the six years and the debt was erased. This is proof that such programs CAN work. What is happening to these young people in this program in outrageous. My suggestion: while this mess is being sorted out, those carrying debt pay not one cent to those holding their loans. Escrow all payments until the program delivers what it promised. Let these lender go without; make a sacrifice; scrimp and save until the mess is cleaned up. We must make the financial lives of the cohort frequently called millennials easier. And do it right now. They kept up their end of the bargain. Now, it's our turn.
87
@ETF
If those borrowers do as ETF suggested they will immediately ruin their credit ratings and spend a great deal of time trying to correct them. Better that they make the payments as promised (or not) and keep the political pressure on PHEAA and ED.
3
@ETF
OK, and in the meantime, how do they live once their wages are garnished, judgments are levied, bank balances are seized, and their credit is ruined?
1
As a person with student debt, I think that college should be cheaper if not free. Although a college diploma most likely guaranteed a student a job in the past, the current job market doesn't guarantee an individual a job after graduation. It is unreasonable to price the cost of higher education at such an exorbitant cost when undergraduate degrees are simply considered prerequisites for entry level positions.
20
@SKim
When I grew up a high school diploma was enough to support a middle class lifestyle. We paid our taxes and our young attended public high schools tuition free, no questions asked.
Today a collage diploma is barely enough yet support for tuition free public collage is non-existent while condemning our young to years of onerous debt.
It's not pie in the sky when the CUNY school system was tuition free at one time.
12
Betsy Devos has to go ASAP. While you’re at it, take Trump with you too.
60
Two numbers jump out at me:
1.3 billion dollars for the Pennsylvania Higher Education Assistance Agency that screwed up so miserably. This warrants a criminal investigation.
90,000 dollar debt to become a teacher? What's wrong with this country? Are we all supposed to become modern slaves of the banksters?
106
For example, in New York, take a look at teaching degree tuitions at New York University, Columbia Teachers College, PACE University and CUNY. You also need a Masters to get fully certified. See how much it costs. We now have free Universal Pre K starting at three years old, and they are looking to start at birth. Yet early childhood teachers at private schools get paid at FIFTEEN dollars an hour to start - with no benefits.
5
@Marc
Just so you know, Marc -- the banks have no role in this anymore. The government took it over -- and of course, made a shambles of it. I
College educated professionals that could not ask questions to get answers.
There should be some sort of retro active process, but it does not need to be easy.
3
Many times the reps themselves can’t provide the answers event when asked, or, they answer incorrectly entirely.
8
Yes, true, this has happened to me. I always ask to speak with someone else.
There’s no guarantee that the next person would know any more.
I'm enrolled in an eligible program, but every year I must reenroll for the year. Still, I am planning to pay my student debt off by 2025 (two years before I retire). I earned the BA at age 30 with a debt of about $32k which ballooned because we all know how the interest rate works no matter how low it may seem. I earned an MFA thereafter which the university I worked for allowed a 75% reduction in tuition to its employees (just the salary was really low so I could not pay up the 25% plus fees). The MFA added a little debt and that of course ballooned. No one helped me through college or not in any monetary way or even sustenance. Nothing. I feel stupid for wanting to attend. But I will pay off this crooked system and I will be finally free. free at last, free at last.
16
1.3 billion to an agency with a one percent success rate? Follow the money: someone, somewhere is doing just fine, unlike this unfortunate young teacher.
54
Among those doing very well indeed is surely Betsy DeVos.
One wonders what her (or her family’s) connection is to the company that so badly managed the money: siphoned off to her or brother (mercenary army) Eric Prince?
12
Is there a way to get a review while in the repayment period? As in, I would like someone to review my loan repayments now to make sure that I really am on track for PSLF in four years as scheduled. My lender is providing that calculation, but obviously I cannot trust them.
There must be an entity that can review my repayment situation - now. If not, then that would be a huge help.
Suggestions?
7
If your lender is FedLoan supposedly they will review it. I would request it x3. Whenever I talk to them I call three times so at least 2/3 people will hopefully say the right answer but I have never gotten 3/3 of the same response even for what should be “straightforward” program related questions. For example all my loans have been in same payment plan and yet all have different numbers of “qualifying payments.” Why? No one can answer - the only thing that makes sense is when I paid extra to pay off a couple loans and they pushed several of my loans into “paid ahead” status meaning none of the subsequent payments counted. I had to call 5 times to get “paid ahead” status “permanently” removed. But they can’t or won’t confirm that is the issue. Since they have repeatedly put me into programs such as “paid ahead” or “forbearance” without informing, asking or verifying with me (which will disqualify payments or stop payments for months until they remove the status) if I even get forgiveness as this point I will count myself lucky.
1
Fed Loan does this. You can see on the home page of the account each loan and how many payments you’ve made towards the program.
@SL
i suggest contact your state senator and congressional representative as well as ms devos in the dept of ed, call their attention to this problem, and request additional verification in writing that you are meeting the requirements of the PSLF program, then submit copies of whatever you get to the loan servicer
My daughter earned her BA at Binghamton in 2018 however I started making payments on her loans in 2016 after paying off my house in 2015. I made the last payment on her loan last week. My son is halfway through his BA and I will start paying off his loans next year and hopefully he will be debt free upon graduation.
Do I oppose loan forgiveness for students not as blessed as me and my children?
Absolutely not.
41
Fed Loan subsidized $3500 and unsubsidized $2000 in loans every year. After the 3rd year in 2016 my wife said we should start paying off the interest on the unsubsidized loans now at $6000. The accrued interest totaled close to $600. I then took a loan on my 401k and paid off the balance.
For the 4th year we declined the unsubsidized loan and Fed Loan subsidized the entire $5500 for the year.
1
We’ve paid a program provider over a billion dollars to forgive $27 million in student loans. What a boondoggle.
59
No surprise here. Our Secretary of Education is dedicated to serving only those who profit from making education a business.
23
Tip: Don't pay the loan at all. Have minimum to no income on paper and go into a debt income based repayment plan, so long as your loans are serviced thru the fed government. You will however die with the loan. Who cares.
7
Then your family will get stuck with it.
Thank goodness I finally paid my student loans off in October...so happy to be free of this mess
4
And again, the question goes back to the underlying costs of a university education. Seems like state schools with in state tuition is the only reasonable option these days.
8
There was also terrible, irresponsible loan counseling happening for years. When i took my loans, nobody told me I only needed X amount for the degree. They literally said: You’re eligible for X amount, you should take it!
From what I understand, there’s better laws protecting borrowers now.
I’ve been in nonprofit environmental work, restoring rivers to improve water quality for communities, for ten years now. Many of my colleagues have tried to utilize this program only to be rejected. I should be eligible but know it’s a waste of time. Loan forgiveness after a decade of low paying nonprofits (in a field I do love) would be life changing. It’s a shame this country would dream of a program like this only to let it turn into another empty promise.
410
@GTM
And you went to school when the tuition was much cheaper in comparison to wages. So you are owed the "OK Boomer" prize of the day.
8
@D
I'm not sure why this is your response to someone who is doing important work for low pay and can't afford loan payments.
Recent graduates may have a bit more debt per capita, but repaying student loans has been a struggle for many years, and every person's situation is unique.
You'd also be wise to remember that your generation has yet to work through a recession, which will make wage stagnation look like a walk in the park. There were times not too long ago when even a minimum wage job was hard to come by.
33
@Michael It's worse than a shame. It's evil.
23
The "Law of Reciprocity" is a concept formed by social psychologists. It describes human qualities of teamwork, mutual betterment, building a better future, etc.
The Law of Reciprocity needs to rescued from quaintness.
4
wait till they get ahold of your medical coverage. smh
4
That’s an erroneous comparison.
Universal healthcare has no eligibility requirements.
Everyone automatically qualifies, just as everyone now does for Medicare at age 65.
1
Student loans, structured as debts that can't be discharged via bankruptcy, offer the people and institutions at the top the opportunity to divide society into educated drones who improve corporate businesses, or into debt peons who live under a crushing burden of debt that acts exactly like taxation but with the proceeds going into their own pockets. In essence, they get paid for making wage-slavery the cost of seeking an education.
How can anyone even imagine that there would be a viable loan forgiveness program?
24
One of the root issues is there are no consequences to the agency denying everything. None. The protests, the screaming are all to deaf ears. Since the agency has no consequences they have zero incentive to comply since from their point of view: "we're right" you are wrong.
Sigh, they could start selling local cable tv services with that type of service record.
This begs for legislative intervention.
23
@Tech Guy
By design, government student loans are opaque and not like any other loans.
You don't get to sign up for a mortgage or a credit card not knowing the exact terms of your loan, and how much you're eligible to borrow.
But that's not how student loans work at all. You accept an offer to attend a specific program, and then you find out how much they're actually going to give you, and the variable rates.
And of course that's only for the immediate year you're enrolled. You have very little idea of how much you'll be getting the next year, or the year after than until you complete you program.
5
Bigger question. If we simply paid better wages to people (notice I didn't say fair) everyone wouldnt have to buy into the college industrial complex. Many debtors were following the bait and switch they were sold- a college degree is essential to get ahead financially. Unfortunate it seems more true that those who can already afford college are the ones who really benefit. This suits the elite - we can deride those who underearn and fall behind for being grifters and debtors.
Fundamentally we need to recognize that janitors, cooks, nurses and caregivers make contributions to society we refuse to put economic value on or "the market" makes it easy to undervalue.
11
It is interesting how debt and politics combine. One group wants something, another group does not want it, so the compromise is to give the askers what they want and borrow to pay for it. Voila, everyone is happy!
With student loans, things are a little different. People wanted less costly education through more public funding for education, other people did not want to pay for it, universities wanted more money, so the compromise was to enact laws that made student loans a form debt that no borrower could ever escape, which brought the lenders in in droves and allowed the universities to jack up their fees while the young and foolish students borrowed to pay for it.
When the chickens come home to roost on this one, it will be ugly. Of course climate change may be coming home to roost at about the same time, maybe there could be another financial crisis too. These days there are so many balls in the air it it is hard to predict how it will all shake out.
4
Students shouldn’t pay interest in education debt- period.
32
It’s not just simple interest, like a mortgage, it’s compounding interest like a credit card. It’s despicable usury.
56
This is why people hate congress and lawyers. Something that should be so simple is overcomplicated.
Where is Sen Schumer or any prominent D elected official on this issue?
Since it can’t be blamed on Trump, they have zero interest.
Again this could be a prime example of why people hate congress and lawyers
13
And we continue to punish our young;
just as the Soviet Union, China and other lovely countries do.
Meanwhile the 50, 60 and 70 year olds in Congress and other leadership roles strive to earn more than a million a year by any means necessary.
14
It’s not just the young. Some of us in middle age went back to school and now have the same problem.
“Ms. Finlaw had no choice but to take out loans to pay for school.”
Nonsense. Private school, $90k in loans! How about a state university to start? She did have choices and she chose wrong.
Now that is no excuse for inept and mismanaged programs and/or broken promises. But don’t infantalize this adult who willingly took on a debt.
11
It still happens to people at state schools. They are still well out of reach of many students
In my mind there absolutely nothing lower and more disgusting than someone who reneges on a deal. In this case, the US Government is a rat. Shameful. Congress must act now and stop this nonsense.
18
I am allegedly less than 18 months away from forgiveness under PSLF. My stomach gets turned into knots when I read these articles because of the base fear it elicits..however, I have the right kind of loan, am in the right kind of repayment plan, and am employed in the right kind of job (mental health provider in a non-profit medical center). I still have no guarantee that I will get forgiveness as was promised to me in 2007 when I first submitted paperwork. I did not enter my educational career with the hope of forgiveness, since I graduated with my 3rd advanced degree in 2007 (the year PSLF was made law, and 3 degrees allowed me to be licensed and practice in my field), however I HAVE made career choices based on the promise of loan forgiveness, and have remained in a mediocre paying, soul sucking, job for years as a direct result of my faith that the contract I entered into in 2008 would be honored and upheld. If my loans are not forgiven in 18 months, despite my paying since 2008, I will have not only lost hundreds of thousands of dollars in lost earning potential as a result of not going into private practice (as so many colleagues do, thus limiting access to high quality mental health care), but I will also have lost all faith in the integrity of our government and populace.
226
@MT I assure you, if you've been notified your employment and payments qualify, you will have no issue getting the balance discharged. Unfortunately, the Education Department never made it a priority to inform people how the program worked so too many loan holders just assumed they could qualify and that's why so many are being denied.
5
@Will that's what I have to assume that others haven't met the requirements, however it is incredibly hard to keep up with the changing criteria. I am hopeful that I am in the lucky minority that has met all the right checkboxes...we will see. For a program that could be salvation for so many, it seems that luck should not need to be the determining factor.
15
@Will
You have apparently not read the article carefully. Many who were assured they were in the right loan program and job have been disallowed.
15
As long as Secretary DeVos is in charge, this will go nowhere. She has no incentive to fix the problem.
This is also why the current moderate Democratic candidates are not acceptable. Only Bernie or Warren (and she doesn't go far enough) will actually do something about the growing student debt crisis.
24
I don’t think it’ll get fixed under a Democrat president unless there’s enough Democrats in Congress to get a majority.
3
@Jackson
Probably because of the Clinton (and hence DNC funding) relationship with the largest for-profit college in the country, Laureate Education. He was their honorary chancellor, pulling $17.5 million a year.
Makes Betsy DeVos look like an amateur grifter.
10 year plan started in 2007. Obama=2008-2016.
The college loan program is extremely dangerous, both in design and in practice. But particpants don't fully realize that until it is too late.
10
I suspect there‘a a sizable portion of the Republicans in Washington who like when programs like college loan forgiveness fail. It feeds into their mantra that everything the government does, private corporations can do better and for less money.
.
Until we can get either the Presidency or the Senate, or both, back in the hands of Democrats, I wouldn’t expect much to change in the loan forgiveness program.
10
All this happened under a DEMOCRATIC presidency
7
@ZAW
This is the reason they devote inadequate resources to administering the law- to claim that programs to assist people and hold corporations accountable are government failures. It’s not enough just to create laws.
5
They also love an uneducated gullible population who will vote for them and not ask questions. Authoritarians like to get rid of intellectuals.
4
Many of the comments here lack an understanding of the big picture. The fact is, an educated workforce is the best thing for the country—it will improve standard of living and prepare future minds to contribute to advancing our nation. Statisticlly, educated populations have less violence than uneducated populations. We should WANT people to become educated. Additionally, in a country with dramatic and widening gaps in social class, education is an equalizer, giving everyone a fair shot at a good life.
We are the most advanced nation on earth, in some ways anyway. Young people should not choose to avoid getting a university educated due to the fact that university costs 8x more than it did in the 50s (and is essentially only available for rich kids?)
We need a sustainable solution here, and telling young people not to attend a university will be worse in the long term for all of us. What if they actually listen?! You want a country of uneducated adults?
Also, the interest rate on student loans is disgustingly high—higher than in banking even. Shame!
Let’s examine how other first-world, rich, productive, peaceful countries do it and see if we can adjust our system for the better.
27
@Anastasia Bailey A healthy population is the best thing for the country too, but no one is screaming that
a person without insurance who gets cancer or other terrible illness, should have their debt wiped out. And that person's ability to buy a house, marry, etc. is crushed as much as a student debtor.
The issue here is that people want loan forgiveness for themselves and their families because they feel the effect of the devastation of owing so much. Those same people likely have zero empathy for the person with the health crisis and no insurance. Or the working person who can't even afford a studio apartment. It's really no wonder why so many push back against this loan forgiveness. If everyone acknowledged the plight of others and demanded action on all of those things, then we might get somewhere.
3
It is a mistake to work with the government on anything. Although you'll find the rich ripping off FEMA in every natural disaster possible. If you were one of the Deferred Action for Childhood Arrivals (DACA), now the Republican Government knows where you are and they can send over Immigration and Custom Enforcement.
The big point in the article, the government paid some organization a $1.3 billion for work they could have done themselves. Crooks, them and our congressman and current President.
11
This many hyperlinks in an article tells you the writers don't know how to explain the problem. Am I supposed to stop on each link, click and read it, so I know to what they refer, then proceed with the article?
I'd be here days.
Thoughtless to the point of grimace-inducing.
3
It's called identifying their sources. It used to be that writers would identify their source by saying "According to this research study..." They still do that to a certain extent, but I find more reporters just link.
4
WE have all taken loans and have paid them off as early as we could. Loan forgiveness is not an American idea and it is outdated considering America's national debt is 23 trillion and lenders are never going to forgive that. Loans for cars, businesses, homes and University education are investments to acquire something of value. Such loans should be taken with careful consideration and not just taken for the sake they are available. America is a great country where one can get loans from private and public sources for multiple purposes often at low interest rates but then to expect that loan should forgiven because of inability to pay it off should be on the shoulders of the one taking loans and not the tax payers.
One of my doctoral students from Pennsylvania farm country took a loan for medical school. After he finished his medical school the government paid his loan off in order MD. Ph.D. students to commit to a career in being a Physician scientist and that is fine for deserving persons.
2
@Girish Kotwal
Loan forgiveness is outdated? The law allowing for this program was signed in 2007. How does something become outdated in such a short period?
18
@BK from FL. The article is about loan forgiveness going astray because of several reasons. I just speculate on one reason the country has no one forgiving their loans and therefore we as a nation have a sky high debt. It is like a bank that has no more money to lend as it is itself in debt. I gave an example of a former student who no longer has a government loan to repay because of what he did what the government would have liked hin to do. A federal loan forgiveness program was short sighted and poorly thought through as many government programs like social security which will also be going broke in 2034 for new retirees. Welcome to America. Politicians make promises they cannot keep. Don't be relying on government, politicians change and new ones come and don't feel they have to keep promises that the previous politicians made.
2
Over half of that 23 trillion in debt is driven by us spending more on a military than the rest of the world combined. Killing people in faraway lands to protect cheap oil is more important than an educated populace.
7
Why aren’t colleges and universities free?
America spent, what, many lives and 4 trillion dollars or more in Afghanistan and Iraq over the past 18 years. If that had not happened and we used those monies like sane people we would have free colleges and universities, new schools, maybe free healthcare too.
Happy Thanksgiving to President Bush and the war machine.
26
They are elsewhere. Just not in America because freedom or something.
8
@Peter A university education costs about $3,100 a year in the Not-rich country of Ireland.
4
Not ‘free’. Paid for by taxes, heavily regulated and rationed, and off limits to all but the best applicants.
You need the last three to make the first one even remotely possible.
5
There are so many broken dreams and permanent shackles associated with the student loan program. My student loans carry 8% interest. They cannot be refinanced, or discharged in a bankruptcy. No matter how much I pay, the balance barely goes down. I will owe this money until I die.
It was the Reagan era conservatives that decided that no one deserved a "free lunch" and that if we wanted education badly enough we will sell ourselves into perpetual servitude for it.
I have made peace with my permanent indebtedness. I just hope future generations get some relief somewhere.There are so many broken dreams and permanent shackles associated with the student loan program. My student loans carry 8% interest. They cannot be refinanced or discharged in a bankruptcy. No matter how much I pay, the balance barely goes down. I will owe this money until I die.
It was the Reagan era conservatives that decided that no one deserved a "free lunch" and that if we wanted education badly enough, we would sell ourselves into perpetual servitude for it.
I have made peace with my permanent indebtedness. I just hope future generations get some relief somewhere.
18
"“It almost seems, like by design, they’ve engineered a way to claim that they have a plan in place without actually offering anybody any relief,” Ms. Waddell said."
But the Pennsylvania agency made out like bandits to the tune of $1.5B. We could have just sent checks to everyone getting a student loan and accomplished more.
29
I have been reading a version of this article for 3 years and it seams as if the only people who care about this travesty are the students who are caught in a Catch 22 and journalists who write about it. Just add this issue to the many where hard working Americans are victimized by the private sector and the government.
21
Could our government be guilty of predatory lending at least on a moral basis if not a legal one? The government gets paid interest and the servicing company gets hefty fees. And for all practical purposes the loans become perpetual debt for the students. Congress and the Education Department can fix this, if they wish, but I am uncertain if they want to.
14
WE have all taken loans and have paid them off as early as we could. Loan forgiveness is not an American idea and it is outdated considering America's national debt is 23 trillion and lenders are never going to forgive that. Loans for cars, businesses, homes and University education are investments to acquire something of value. Such loans should be taken with careful consideration and not just taken for the sake they are available. America is a great country where one can get loans from private and public sources for multiple purposes often at low interest rates but then to expect that loan should forgiven because of inability to pay it off should be on the shoulders of the one taking loans and not the tax payers.
2
@Girish Kotwal I gather you have never heard of National Defense Student Loans.
3
If a growing number of taxpayers are facing crushing debt, what effect do you think that will have on the economy? Another recession essentially. Like when people borrowed money for houses they couldn't afford, while financial institutions got a higher rating for those loans than they should have, which allowed those institutions to sell those bad loans at a higher premium, meaning the economy collapsed on itself when the loans defaulted. However, those financial institutions got bailed out. And some homeowners even received debt relief. So, how is debt forgiveness not American exactly? Seems like predatory lending and retroactive patchwork is all we do here. Anyway, until something is done, a growing number of Americans, who are taxpayers, will not be able to invest in the economy (start businesses, buy houses, consume, invest, save, pay their taxes) because they'll be paying off this debt.
7
Tax cuts for millionaires clearly more important. (sarcasm)
15
Just don’t pay.
1
The haves don’t want your kids competing with theirs AND they’re only too willing to make money while ensuring you and your kids bankrupt yourselves in the process.
10
Is it that our citizens can’t read legal documents?
Or, is it that our government can’t write legal documents?
A loan document is a legal document.
Should students hire lawyers to interpret these documents for them?
Obviously, something is rotten in Denmark. Why blame Denmark?
1
I attended a state college in the late 70s. Had a Basic Education Opportunity Grant because my parents were blue collar. Lived at home for all but one semester. Took classes two summers, graduated in 3 years and not only had no debt, I put money away. Those were the days when GRANTS were widely available for students of modest family means.
13
@Anne Hajduk Same here. I was the first in my family to attend college. I wrote a thank you note to my financial aid officer when I graduated. I wouldn’t have made it without him.
My family was homeless before there was a name for it. Affordable education is how I climbed out of poverty. We have turned our young people into cash cows. It’s a disgrace.
6
When I was a college student, the federal government offered student loans, the National Defense Student Loans, at 2% interest.
People who worked in certain jobs, including public school teaching, would have 10% of the their loans forgiven for up to five years as long as they stayed in those jobs. Teachers who taught in a federally designated high-poverty area for five years could have their entire loans forgiven.
My private college degree was financed by a combination of parental contributions and scholarships, but some of my friends enjoyed what was essentially a half-price or free college education because of the NDSL loans.
6
@Pdxtran Me too. And my husband and everyone else I went to school with. He became a science teacher in an impoverished rural area. I was a social worker in the same area.
The government had no trouble implementing that loan forgiveness-public service program then.
9
This is outrageous, but there are way more private loans that banks will never forgive. A majority of student loan debt is private loans taken out for advanced degrees at private universities.
I work in the public sector, but I’ll keep paying close to $400 a month of my student loans for all of my life it feels like.
My only hope is that I don’t pass on my debts when I die.
9
Bravo to those of us able to repay our student loans pat yourself on the back and puff out your chest. But please save the lectures for the boomer investment club meetings. When people are in repayment for decades, they arent shirking. As with health costs any wrong turn, missed payment, or indifferent servicers and the penalties suddenly add up. I'm fully paid but my partner will be in debt til he dies - even though hes eligible for forgiveness the amount will result in huge tax liability. Bottom line is that student loan debt is holding back our economic growth and as usual lining the pockets of wall street and Betsy deVos cronies. Dont get me started on Donald Trump's philosophy on debt repayment....default and bankruptcy are only available to rich "risk takers." Teachers, firefighter, social workers should be more responsible?
51
Follow the money. Who benefits the most from this tawdry situation? The mistake Ms. Finlaw and others made was to believe this. It WAS too good to be true.
This points up the fact that, for most students, college is not affordable without a loan or three. Why we are willing, as a society, to allow young people to take on debt before they've even begun to earn a living is a mystery. Why we are willing to let students graduate from high school without salable skills is another mystery. A college education doesn't guarantee anything to anyone. The worst part of this isn't about those who graduate from college. It's about the students who drop out for whatever reason and still have to pay back loans for an education they didn't complete.
Our legislators know that the current loan system is untenable. Yet they continue to allow it to function. Colleges know it too. There are two ways to deal with this. One is to provide every high school student a solid education along with providing non-college track students the opportunity for an apprenticeship or training for an entry level job. Another is for employers to stop asking for ever more credentials and start investing in their employees. Last, but not least, perhaps we should look into providing more scholarships instead of loans.
27
@hen3ry ah but officially we do not have a class system so how do you make sure the riff Raff stay out of the country club? You defund public education, make a liberal arts degree which unlike highschool is not free a minimum requirement for addmitance and you will have successfully kept out a majority of undesirables, and saddled those that dared dream with enormous debt. So what if we are missing out on local potential, in stem fields for example? We can always get hired help from abroad while railing against immigrants lest they dare forget their place in the pecking order.
5
A big majority of Federal regulations are construed with enough ambiguity to be interpreted solely at government discretion. Political interpretation is the legalization, in most cases, of outright fraud, bait and switch, etc.
7
@joe new england
As someone who has worked for multiple regulatory agencies, I disagree with your comment. The requirements for the loan forgiveness program may not be as simple as borrowers would like, but they are clear. I’ll be eligible for forgiveness within a year and a half, and I read the requirements prior to entering the program 10 years ago.
4
Then why doesn't Ms. Amway take the time to make things clear? And, what of the initial sales job done in enticing people into the jobs? And whhat of the company paid by taxdollars to monitor the loans?
2
@joe new england
It appears you’re not familiar with the program. Reading this article is insufficient to understand the program.
4
The Enron of Student Loan Programs! The lack of accountability feeds the corrosive lack of trust that Americans have in their government. How can we compete with China and other industrial countries when this happens. My mother proudly corrected my father when he would tell me "nice guys finish last."
FedLoan is proving my father right. Sad commentary on our state of affairs.
10
At the risk of being cynical, why did students take out loans and then go to universities they can’t afford and choose majors that would not allow them to pay off the loans after graduation?
11
@Bryan Mackinnon Becuase virtually every private university now costs $40,000 a semester and even public universities cost as much as private ones did 15 years ago. Many of these students turned down lucrative job offers in order to take jobs that are beneficial to society but lower paying with the understanding that this program would help them.
25
@Bryan Mackinnon : Because a nation made up of only business majors and engineers would be a terrible place to live.
24
@Bryan Mackinnon
For all the whoopin and hollarin about needing STEM students to do these.good paying STEM jobs, many start at $50,000. Computer jobs $80k if you are lucky or 6 figures and living below the poverty level in Silicon Valley.
Many STEM job holders struggle to pay loans. I would never recommend a young person go into computer science and if you into engineering plan on being broke and reinventing yourself over and over. Many of these are contract jobs.
I am able to pay on my loans on the income repayment plan. I will not live long enough to pay them off. Why did I go back to school? Because I had 20 years before I could get social security and IT discriminates on age, skin color, gender, and nationality. Three new degrees landed me a job at half what I made in 2008 when I was training H1B visa holders to take jobs away from Americans over the age of 45.
15
Those who owe student loans --at the ridiculously high interest rates-- should decide en masse to just stop paying. Most have little to lose. They cannot buy homes, and if they have children, they suffer.
Education is too expensive.
It is time to forgive all student loan debt, and stop creating more.
Bernie is right.
14
They're supposed to be grown adults who knew what they were doing. Why forgive the loans?
6
@Gary Because that is literally what the program was designed to do. They didn't create the program, they just attempted to utilize it, many making significant life decisions based on the existence of the program.
13
@Gary
Why forgive the loans? Because the law allows for it, signed by Bush in 2007. Are people now asserting that laws should not be enforced?
13
I'm currently on this PSLF program. There are a lot of stringent criteria you have to pay attention to. I recommend people review it with an accountant or attorney to make sure your payments are qualifying. Don't just take the loan providers at their word.
12
This was a completely unacceptable program to begin with, and still is.
The solution would have been that the government would pay the tuition for people wanting to go into these valuable professions (like teachers, social workers) - much like the military will pay for schooling after service. It simply needed to exact a promise that the students would stay in that profession (otherwise, the tuition would have to be paid back in its entirety).
Instead, we got this loan forgiveness program forcing students to take out horribly expensive loans and slave away for years and years with a vague promise (that is then often broken) that eventually the loans are forgiven -- what?? It doesn't even begin to make sense.
The lesson for students is, if you think you may have trouble paying back student loans, then you should find a school with lower tuition. Much of the time, college is not worth the money in terms of future earnings.
9
Dear students and graduates-- Vote.
29
The loan 'sevicers' ventured nothing in this equation. They are part of an entirely corrupt system that is in reality a massive scam against average Americans by Wall St and the wealthy.
13
As if the main issue with student loan debt were that it’s too liberal
3
If you do not intend to ever pay back your loan, stop every payment and communication with your lender immediately. Eventually they will sell your loan and after going through multiple hands it will be worthless.
5
This is dangerously untrue - if you default then a judgment will be issued against you and your wages will be garnished at a rate which pays the entire loan back within ten years - regardless of income and once garnishment begins the only way to get out of it is to pay double the garnishment amount for 1 year.
5
Many of the comments on here reflect exactly the cruel, judgmental attitude so pervasive in our politics.
“I had to pay off my loans, so it’s UNJUST to forgive people’s loans now!”
Aside from the fact that this is debt relief for a small group of people who have chosen public service for their livelihoods, whatever happened to wanting a better life for future generations? We didn’t have a cure for polio when my grandparents were kids - should we stop vaccinating now because it’s “unfair” to our ancestors? This, in a way, has always been the American attitude: Escape the injustice of home, make it to the shores of America... then immediately start pulling up the ladder behind you.
However easy it might be to try to place blame on one administration or another, it might worth asking: are our own dumb attitudes part of the reason our society is unraveling?
16
@Mr. Bubble I see people talking generally about loan forgiveness here. I'm totally agains that.
I am, however, fully on the side of students who were hoodwinked and deceived about a loan forgiveness program. Those students should get relief.
Everyone else should pay their debt. There are OPTIONS with regard to college. If you choose an expensive school for whatever reason, then you deal with the bills. These are choices that people are making. Go to community college, take a few courses at a time while working full time and take longer to graduate without debt, live at home and commute. But no, people want the "experience" and to say they "went away" to college. If that's the case, they can pay for it.
2
Another cynical con from the Feds [state and local governments pull the same stunt], just like the "mortgage relief". It was never intended to work, only intended to fool make "nice soothing noises" like an Obama speech. Funny how well run the bank relief program worked though went through with almost no hitches. go figure.
3
Just remember...The GOP leader, Donald Trump, promised he "would not touch Medicare and Social Security".
Do you feel lucky?
2
Incredible negligence, malicious. Coming from our Representatives, I call it borderline with massive fraud. A store would be more responsible for false advertising..
6
Someone should fix this betrayal. Another reason to defeat the current occupant of the White House.
8
This could be corrected by remedial legislation...Nancy, Mitch, Donald ????
1
The scariest words in the English language are “I’m from the government and I’m here to help you.”
For those who didn’t already know this and got bit, consider it an added value to your education. Now you know. Go forth and vote accordingly.
2
@KBronson
I suppose the next time the SEC is examining the broker dealer or investment adviser where your investments are held, they should not bother conducting a thorough examination. You have no idea if the entity where your investments are held are complying with all laws and regulations. In fact, maybe the next time I’m conducting an examination of a firm in a red state, I’ll do a poor job since the people in those states want no assistance from the federal government.
7
@KBronson : Anyone who quotes Ronald Reagan as if his words were divine revelation from above immediately loses all credibility.
12
@KBronson No that is the pap that started the down slide along with all the other lies of the Reagan administration and the modern right it led to. Yes indeed. Vote Blue. Also, as a rule I will not visit any Red State, do business with anyone I know to be on the right.
1
As someone who will be eligible for loan forgiveness within a year and a half, I see a few issues here:
1) Either the current administration and/or Congress has failed to ensure that Fedloan Servicing has adequate resources to deal with all of the borrowers who may be eligible for the program.
2) Servicers have failed to provide adequate training to customer service reps to ensure they provide correct information about the program to borrowers.
3) Many borrowers have failed to become familiar with the program requirements, just assuming incorrectly that they would be eligible. I read all the requirements approximately 10 years ago when I consolidated my loans with the Department of Education.
8
For hundreds of years, a majority of our population has had student debt and these people were able to successfully pay off their loans. If people were able to pay off their student loans in the past, why can't people do the same today? Even if the student is unable to financially support themselves through college, the government already provides the student a certain amount of financial aid. If the student chooses to attend a private college outside their financial eligibility, the student should be responsible for the leftover student loans.
3
@SKim
Because college cost have grown exponentially. Very simple actually.
Oh also a lot of us graduated into the Great Recession which made finding a first job incredibly difficult, which means that the interest on loans accrues then capitalizes. We also generally made lower salaries than we otherwise would have if you graduated into a strong economy.
Or at least that’s what happened to me. I only took out federal loans.
And no, I can’t really say that I bear any responsibility the crash in 2008 that occurred when I was a college sophomore.
20
The debt of yesteryear doesn’t happen today. For example... In state tuition at University of Maryland (my alma mater) is now $11K, if you can get in. Back in the late 60’s it was everyone’s safety and cost $1.4K for room, board and tuition. My salary as an RA in my last year was about $1.4K, so I should know.
My niece is out of state at University of Colorado medical school. Debt to date is $289K even with my wife and I throwing $28K per year plus extras. Oh sure, everyone says “She’ll be a rich doctor!” Yeah right. Medicine is not what it used to be too.
Things have changed baby!
18
Wages haven’t increased in line with education costs or especially housing. And that should be obvious.
13
As someone that is counting on the 25 year loan forgiveness program, I really do not understand why some of this is so confusing. The information about which loans are eligible (direct loans) is available on the website. Why would anyone think a private loan is going to be forgiven??
I also am already prepping for the hefty tax bill I will get the year my loans are forgiven. My assumption is that I will have to save a couple thousand a year for the next 20 years to be sure I have enough.
Maybe all of this is a sign that we are sending way too many people to college. If they cannot navigate student loans they probably should not be taking them out.
6
Why would someone working for a health insurer be considered a low-income profession? Health insurers are already ripping us off through the yin yang as it is.
3
The Department of Health and Human Services offers up to $75,000 loan forgiveness for health profession workers who serve in low-income or rural areas - where the least lucrative but highest-need jobs in health care are. Eager to reduce my loan burden of over $200,000, I took a job at a community clinic. I was told (after one year of working already) that I would not be awarded the loan forgiveness. When I wrote to ask why, they said the funds had run out before they even got to my application. Additionally, Trump's tax bill as of this year ensures that this is the first year where people at my income level cannot deduct their student loan interest payments from their taxes.
The most surreal aspect of it all is that the federal government lends us money, but private corporations profit off of the interest. I wonder why people my age aren't rioting. Then I remember we work longer hours for less pay, with a higher cost of living, and I just feel tired.
128
@Community NP That means you are making over $85,000 a year (if single). I would say that is pretty good pay. I am in a similar student loan debt situation and I feel very blessed that I can pay my loans back with my current income. I guess it is all in how you choose to view the world and your situation.
1
I’d be very interested in an analysis of what these students actually studied who can’t pay back the loans.
I bet it would be eye opening. Most should get some serious HS Guidance counseling’s before signing up for loans.
8
@Jerry Davenport They're studying to be teachers, researchers, doctors, and lawyers, among other things, so they can work in public service because that's the name of the program.
3
We have watched tuition skyrocket as state funding to public colleges and universities is slashed. Students are terrified of taking out loans. This is starving the community’s future.
12
I have found dealing with federal officials much better than dealing with contractors. DoE should hire term employees to death with these matters and get rid of the loan servicing company.
And a reminder to those expecting to die with their loans— loans may qualify for forgeus if the borrower becomes permanently and completely disabled.
My husband and I both paid off our student loans in our mid-fifties. Neither of us had a dime’s worth of family support, and we both earned terminal degrees, although it took a long time and many part-time jobs. At times one of us had to skip a semester and work full time. As a result of this we both had fewer years to earn income, which substantially reduced our retirement income. Not once did we question our obligation to repay this debt, and the entire notion of “debt forgiveness” makes me furious. So unless the powers that be make this program retroactive for ALL who borrowed federal money it should be eliminated.
And I might add that we were both “first generation” college students, which today means a lack of academic preparation and/or a lack of intelligence, and so “accommodations” must be made, most often admission to universities far beyond the scope of student capability. Of course none of these unprepared students are allowed to fail, so they are set free to create further degradation of everything they touch.
Today I suppose our “first generation” status would earn us a special place at the proverbial table, except for the fact we were exceedingly well-prepared, having made all “A’s” when there was no grade inflation. This sounds self-congratulatory but is not, for at that time EVERYONE worked hard and repaid their student debt regardless of how difficult it might have been. We fulfilled our obligations and so should these whiners.
9
That is great that you were able to do that. Unfortunately, college costs have increased at EIGHT times the rate of wages over the past thirty years, so you can’t really fairly compare your experience with the experience of kids attending school today.
14
I imagine almost all of us would be willing to pay off the amount of debt you had in full, as low as it was. I'm willing to pay off my $380,000 med school debt. But if I'm offered forgiveness programs that alter how I make my loan payments, and my interest rates, and which jobs I apply for...I just don't want to be lied to about the criteria.
13
You need to check your spirit. Just because you have fallen for the promises of a system that was designed to take advantage of you, doesn't mean you should wish the same on others.
2
But, according to the right-wing pundits on the op-ed page, forgiving this debt makes for a country moochers.
Plus, folks are so much easier to control, when they're burdened with life-long debt. No street protests or activism for them!
13
Let’s cut the Military budget by a trillion, and provide American kids, who need help paying for college or a vocational school FREE tuition!
The wealthiest nation on Earth, needs to get its values straight!
38
This is incredibly sad, the money is there but not being used as intended because there is so little oversight and enforcement of basic standards for these government contractors. Do not expect Betsy DeVos to fix this! She has made it clear she is not on the side of students, unless they are already wealthy. These practices will continue to erode the middle class and drive the best and brightest away from public service jobs. We need to elect a president who will appoint people who care about education for all and who will help the middle class from going under. Any of the Democratic candidates will fit the bill!
8
@Mac
I was with you until the last sentence. Buttigieg and Klobuchar are essentially Republicans when it comes to the college debt issue.
1
As Calvin Coolidge said, ”They rented the money didn’t they”. Don’t borrow money unless you are going to repay it.
4
Unless you are a financial institution, the auto industry, insurance company, mortgage originator, and other too big to fail institutions. The country is littered with beneficiaries of Socialism for the rich, but it's Capitalism for the weak suckers.
6
I don't think any Loan used to pay a private university should be forgiven. Students who select private, expensive colleges or universities should be mandated to pay in full. The alternative would have been to go to a State College or State University where Tuition is lower.
8
Just like health care the education system is broken, and if the government relief the students from paying their debt. That
will not solve the problem but will encourage universities and
students in this path.
3
As a former victim of PHEAA (Pennsylvania Higher Education Assistance Agency), I’m not surprised.
I applied to PHEAA back in June or July of 1989 for a loan for a graduate program that fall. They were supposed to process the application in less than 2 months. Come December, I was still calling and writing letters begging them to process it. I was lucky to be attending a very indulgent university.
When the check finally arrived, they sent it to the university, but made it out to me! I had to run to the bank and take care of the transfer of funds.
I’m sorry to learn that PHEAA is just as callous now as it was then. And I’m sorry to see that the people in charge of the program are obviously the same way, incompetent, or both.
11
This is a disaster more than a decade in the making. It goes back to the original law establishing the forgiveness program, and successive administrations that have refused to own the problem.
The mere thought of entering into the labyrinth of federal and public/private bureaucracy to work this system makes me want to hyperventilate.
There must be a better way to finance higher education.
2
This is a program designed to encourage bright, idealistic people to enter public-service professions -- and then we turn our backs on them. Underneath it lies a bookkeeping problem. If we lack the will or the ability to fix something so basic and important, we shouldn't as a society be able to look at ourselves in the mirror.
33
Honestly I tried applying for one of those loan forgiveness programs some years ago but was denied.
I gave up and just finished paying my student loan last year. It took me 17.5 years to pay it off but it's finally over.
No regrets; signed because I needed it and repaid it. :-)
4
And we call ourselves the richest, most advanced economy in the world. I say phooey!
15
Every job serves the public in some way. There is no reason to put people in so-called "public service" on a pedestal and forgive their loans. Already their paychecks are coming from the taxpayer.
4
When you have to pay the professors full retirement pays for 40 more years of life that is just plain wrong. Most of America gets Social security and the GOP want to take that away. They are greedy and most tax paying Americans are only getting Social security. Go to work instead of college or go on line. It should be cheaper.
1
Too add insult to injury the borrowers In this supposed forgiveness program were required to continue payments for the federal loans with absurd interest rates (6-8%) and not refinance. And then you expect us to believe when you say “Medicare for all.” I would sooner believe in Santa Claus
2
Why am I not the least bit surprised that republicans would be happy with a program that only is helpful to the "one percent"?
3
Tuition should be based on the earnings potential for the major.
A PhD in Gender Studies should cost a lot less than a PhD in Immunology.
7
This story makes my blood boil: decent people trying to play by the rules getting told after ten years by people whose job it was to know the rules that there was something wrong with their understanding of the rules!
12
If we can’t get this right, then we need to dissolve our current government .
“When in the course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation."
This would be Item One on our laundry list of items that compel us to separate from those Americans who, whether they realize it or not, are still and forever desirous of having their slaves returned to them.
2
Not at all surprising that these are the same student loans created by Republicans in 2005. Even better is that none of them have ever even been poor enough to need one.
1
I keep reading article on this subject over perhaps the past two years. It seems a fraud perpetrated by Congress which has not intention of forgiving anything. It is like Congress passing bills which make headlines yet are never funded.
3
My wife was promised this relief. She has paid dutifully for 15 years and nothing. She stopped applying for relief but I want to convince her to apply again. It is a broken promise and I want a record of the lies.
8
This looks like a "bait and switch" to me. You work in the vital jobs in the areas where no one wants to be for 10 years pay your debt on time and we will forgive the remaining part of your loan. Only to find out the fine print makes you ineligible. The vital jobs get staffed and the staff gets stiffed.
20
Meanwhile, the administration has *given* $25 billion — no strings attached — to struggling farmers in the hope they’ll still vote for trump.
8
The specifics of this program are missing from this article. This presents two problems. First, readers who are not fully informed about the program already will fill in their lack of understanding in order to relate with the stories related from their experiences with other government sponsored programs. Second, it violates a fundamental principle of journalism, never presume that the reader has read all the previous articles about the subject.
3
promises made, promises broken.
When I hit 120 payments, there isn’t going to be any more. The feds can pound sand. This is what comes from trusting Americans.
4
@Doug K
They will garnish your social security checks. Really.
2
Vital reporting.
It puts into stark view the scam that are convoluted, means-tested programs. And you know who’s been in love with convoluted, means-tested programs going on a couple generations now? Democrats. It’s why there really wasn’t much of a constituency behind the ACA. It was convoluted. I kept having to bounce between awful, high-deductible insurance plans each time my income fluctuated. Same with my IDR for my student loans. Is your income ever in flux? Welcome to bipartisan bureaucratic dystopia America.
Look at Warren’s debt forgiveness plan: “If you make less than $100k, you get $50k of your $89k forgiven, but if you make between $100k and $250k, you’re eligible for a sliding-” No. No more mealy-mouthed technocracy. Cancel all of it!
Universal programs build constituencies. Universal health care, universal public higher education, universal student debt cancellation. 100%. Free at the point of service.
Only one major candidate, Bernie Sanders, is bringing relatively simple, universal programs to end the nightmare this article lays out. This is what will build constituencies and defeat republicans between the coasts.
Ms. Finlaw spoke of her freedom from debt as “the light at the end of the tunnel.” If we don’t get organized now and in 2020, we can be sure that, as Slavoj Zizek points out, the light we see at the end of the tunnel won’t be our freedom, but another train heading straight for us.
Reagan Sloman
https://reagansloman.blogspot.com/
12
This is digusting. The department of education works for US!
2
@Mary M
Didn’t you get the memo? The bureaucracy works for the bureaucracy. Nothing new here.
1
Funny I once had a friend tell me about such a program perhaps an earlier version. I knew the govt can’t be trusted and stayed working on what it wanted and now I’m a millionaire and lyin’ Uncle Sam can go shove it. As a side not anyone who believes Warren or any other wannabe socialist that govt can actually deliver should read this article and wise up!
2
This is just sick. I am one of the lucky ones. I made enough dough on a side deal/trade so I could pay my sons loans off. But these other kids are not in the position. 2007, so let's see, this Rube Goldberg deal was set up when Shrub was Prez and Congress was GOP dominated. It was right before the big take down, a year or two before the The Financial Services and Billionaire Bailout program really did bail people out, the least deserving. Sorry, this is a pathetic example of true government failure. (to be fair I usually gripe about market failure) But I get the feel the private sector had their greedy fingers in this pie too. No wonder the rubes turned to Trump. He sold a pile of garbage but he presented it correctly.
9
This is one part of the student loan debacle. I worked for the federal government for 18 years (including 10 years after 2007) and did not qualify for forgiveness after making regular payments for 20 years because I did not make payments under the correct plan. Essentially, my payments were too high!
13
Despite having benefited from a college education myself, I can no longer recommend it to anyone who doesn’t have the wealth to pay for it without borrowing. Is higher education an asset? We’ve been taught to answer yes, unequivocally. But now the answer is maybe at best. A lot of people will be better off just spending that time working and accruing experience.
4
I paid off my student loan of $100,000 (plus interest) over 12 years after final graduation. I was one of the lucky ones who earned enough to do so.
The people who are not able to earn enough to pay off their loans should be forgiven and the losses written off, if there is evidence that the person's income is simply insufficient to pay and there has been demonstrated effort to pay something over a period of at least 10 years.
55
Consider that the 70% of adjunct lecturers at colleges and universities aren't even eligible for this program because of the way it was set up and its very narrow requirements. Then you get a sense of how many people have been thrown into debt indentured servitude when they took out very modest loans to finish a program or get past an assistantship shortfall. A tiny fraction of the people doing essential work in public institutions were made "eligible" - and most of those have been denied. The for-profit debt companies certainly are getting their money's worth from their paid politicians.
46
@Sara Yep. And no matter how hard we work, we always hang on by the fingernails. I am lucky--I went to school while it was still affordable. But now, the terrible secret for the majority of the instructors, we are in terrible shape. The best I can do is tell my students not to do what I do unless you are rich, and go to Community college for the first 2 years.
8
This is a shambles but the entire student loan system is desperate for reform. Income based repayment for a fixed period of time, then relief on the balance - without tax obligation. Treating the forgiven amount as income resulting in an enormous "tax bomb" is a sick joke. It goes without saying that public service forgiveness is a special case - if they can't even get that right I have little hope of addressing the wider problem.
This system wrecks lives.
119
Loans forgiven under the PSLF program are actually not considered taxable income. However, loans forgiven under most other forgiveness programs are indeed taxable.
5
@Ross
As is acquiring education. Neither should make one poor.
4
Why is it that those who give the most of themselves to help society always seem to be the least compensated and taken advantage of? Our society's priorities are backwards.
155
'Keith New, a spokesman for the loan servicer, said it “believes in” the Public Service Loan Forgiveness program and “works tirelessly to help borrowers navigate the program’s complexities.”'
Sure they do. Just as Amazon does everything it can to prevent injuries at its fulfillment centers.
We need more government oversight of business. Without that, it's a race to the bottom, a race back to the good ol' 19th century.
75
@Sixofone
The solution to government programs that don’t work is another government program.
That is why we can’t do anything anymore.
3
Wow: Trumpists don't feel like honoring government promises to students who took real jobs that actually benefit the country? What a shocking surprise!
31
@Randall You do realize that this program was established over a decade before took office and the majority of the problems discovered took place
2
This is completely shameless - and shameful at the same time. I was fortunate enough to have gone through 7 years of Canadian university programs in the 1970s and early 80s, when it was quite easy for students living at home to pay their tuition, books and other educational costs simply by getting summer jobs - no working during the school year, and no need to take out loans. I think that any civilized country should make higher education available to all qualified students, in a similar manner... after all, the future of any country depends in large part upon how well that country prepares its youth to take their place in society, pay their own way as adults, fill the many roles necessary to run a complex, thriving civilization, and keep their country competitive in the areas most vital to improving its standard of living on an ongoing basis... science, technology, education, industry and business, etc. Any country which puts up roadblocks to young people eager, willing and ready to better prepare themselves to serve their society and their country, even in self-interest, will inevitably decline and wither in a variety of ways. The coming decades will surely display the high cost of poor education policies in the USA, and alas, Canada also... tuition here has increased FAR more quickly than the wages the average student can expect to make, and students from economically disadvantaged families are forced to take out loans, or not go to university at all.
50
As a conservative this too outrages me. Congress fairly and legally appropriated the money and it’s not being used. We should at least use the money if it’s there.
27
Shameful. Would Sanders or Warren fix this? Hopefully. Time for a big change.
34
My student loan payment plan is Bernie Sanders is elected and does a blanket cancelation of the debt.
38
Back in the day, days of yore, students would earn money to put themselves through university if they really really wanted an education.
Today, everyone wants to attend even though they don’t have the credentials, take useless classes, get a useless college attendance paper and can’t parlay it even into paying their signed for loans back.
What’s wrong with system?
Let’s tighten up college admissions and weed out the academic incompetent. We need plumbers, electricians and undertakers etc.
we’d be a far far better country and with less student debt.
7
@Jerry Davenport This is factually inaccurate. Wages have not kept up with costs, not for college, for housing, or for other necessities. It’s not about the “wrong” people going to college or students taking the “wrong” classes. It’s about America being run for the benefit of the ultra rich at the expense of the rest of us, starting with the third-world policies of Reagan, Rush, and Newt. Take a look at CEO-worker pay ratios, and how these have changed since 1980. The evidence is obvious for anyone who cares to look.
Get your facts straight, Jerry. Happy Thanksgiving!
8
It use to cost much less to attend college. You can't transpose your experience of years ago to the reality of today.
5
@ Jerry Davenport That’s an ignorant observation, Jerry. At publicly supported colleges and universities, the percentage of the cost of fees/tuition, never mind housing, has steadily increased since the 1960s so that most of the cost is now being born by the students and/or their families rather than the taxpayers who benefit from the next generation of state citizens. When I attended the University of California in the 1960s, for example, my graduate student fees per quarter were only $83. Take a look at what it cost at any state university now for students to take a full quarter’s or semester‘s worth of classes and decide then if your comment is factual or not.
5
Speaking as a Boomer, I have to say that all this is very sad. All of you in your late fifties on should say extra thanks on this day that you never had to be financially assaulted and extorted and just plain held up and kidnapped for life like this. Education was almost free. What have we become when young, naive people betting on their future are ensnared into a criminal system that is a cross between high end Soviet sadism by corruption, and the worst of street loan shark behavior.
And, btw, look at the dates. This started a long time ago.
254
@Concerned Citizen
The actual numbers prove your experience is far from the average.
The total amount of student debt has increased from less than $500 billion in 2006 to more than $1.5 trillion last year.
Here are the averages for private and public circa 1973;
“1973: In today's dollars, tuition for one year at a private college averages $9,876, and at in-state public schools just $2,175.“
These numbers are 10X today.
Gets your facts straight before you denigrate the poorest Americans.
16
I’m in my late fifties and and my education was definitely not free. And I went to an in-state school. I had college debt that I paid off over time. My parents were wise enough not to allow me so much debt to pile up and I selected a major that allowed me enough income to pay off my debt in 7 years though there was some hardship for a while.
4
I took out private loans to attend a public university for my undergraduate degree. This was the only way I could attend college - my family could not afford to pay for my University.
I was lucky enough to get a full scholarship for graduate school, and deferred my undergraduate loans. I worked full time while going to classes at night, and even then could barely afford to live on my entry-level salary at the time.
In that two and a half year period, my undergraduate student loan debt ballooned from $70k to $115k. I couldn’t believe it.
For the first few years I paid the $1200 a month minimum payment. Guess what? My loan actually increased month to month.
A fews ago I made a conscious choice to stop paying my private student loan debt. I struggled with the decision- I’m not someone who didn’t want to pay my debts, I just simply couldn’t rationalise in my mind anymore spending that much a month and watching the debt just go up.
The company managing my debt settled with me for pennies on the dollar after 18 months, and now I am free and clear of private student loans. It was the smartest choice I ever made.
183
@CWD please explain how that worked.
7
@CWD You made a business decision. No shame in that. The corporations do. Individuals should get comfy with behaving the same way.
17
@CWD it would appear math was not your strongest subject.
1
Amazing that the government can give money to those who don't need it, with no strings attached. But devise a way of giving money to those who do need it, so complicated it pays more to the administrator than the recipients.
40
Retroactively reset all interest rates to exactly what institutions were giving for savings accounts. Have the feds redistribute assets or govt bonds to institutions making up half of all original balances. Dock paychecks up to 5 percent for ten years. For future students, no private loans, increased Pell Grant's for all and states that cut public higher education get all federal highway funds taken away.Simplify FAFSA and raise income limits for financial aid drastically. Make the entire generation whole due to ok boomers lack of responsibility. If a representative complains take all federal funding from their district and make all student debt in their district completely forgiven. If an algorithm at the IRS and federal reserve can't do the entire process then simplify more leaning toward complete forgiveness. Don't want to hear about debt when rich folks are skipping military duty and taxes...
7
@Danny - "Make the entire generation whole due to ok boomers lack of responsibility."
So it's all the "OK Boomers" fault you choose not to honor your written promises to pay back the money you borrowed?
Right!
And while we're at it, why not have your BWM car loans and your in-town condo mortgages be forgiven as well.
1
Just another sad example of our broken government. Imagine how the economy would thrive if these students could buy houses, new cars, appliances, invest in the stock market etc instead of pay off student loans forever and ever.
515
but then where would the funds for GOP billionaire tax cuts come from??
oh .... they're not funded either
113
@Jacquie
The Democrats chose the Wall Street and not the Main Street.
18
@Dr. Biri "The Democrats" did no such thing: we passed PSLF, and we would have honored it. Treasonous Republicans who view America as a piggybank chose Wall Street, not Main Street.
105
I cannot understand the lunacy involved with the student loan problems.
The solution lies in holding not only the student but the primary beneficiaries of the whole system liable. That includes the institutions that receive the money.
The problem would be solved not by forgiving the debt but by recognizing that a minor it duped into supporting a system primarily designed for the financial security and prestige of those in charge of the institutions.
Let's face it what would a car cost if all a teenager had to do was go to the dealer, get an authorization from the car salesman for someone to pay for the car and tell the teenager they don't have to pay anything for five years. And furthermore, the salesman could say the car costs whatever the salesman wants. So the "someone" sends a check to the dealer and the kids drives of without shelling out a penny.
In the case of a college the salesman is the "gang" of financial aid office, registrar, and high school counselor.
Where else can a seventeen years old go and have a trusted adult say, "Sign this agreement to have these people send $100000 directly to me and then you pay the bill five years from now.".
The college promises nothing. At least with the car you get a spare tire!
Make the college at least 50% responsible for the money if the student renegs or goes bankrupt. How much money would the school authorize for the art history major then?
9
And while we are at the breaking of the social contract, let’s not forget the so called “windfall elimination act” which reduces ones hard earned social security benefits if one also collects a hard earned teachers’ pension. Criminal. Just criminal.
41
That is a state level decision. New York teachers pay into and collect both Social Security and a pension.
2
@Holly Scordo Your SS payments are reduced if you get a pension.It happened to me. I worked for ten years before I went into teaching. (I didn’t pay SS while teaching.) I get virtually no SS. My father was in the military for 35 years, and he paid SS got all those years. When he retired, his SS payments were drastically reduced because he had a pension.
The fact is that we have no choice but to try to fix our government. We cannot privatize our way out of incompetence, inefficiency and political compromises that make a mockery of a law’s intent. We have to try to make government work with the tools that we have to fix it, and the first order of business is to fire the people who have decided that it’s in their political and economic interest for government not to work.
In other words, if you want the student loan relief plan to work, you have to make sure that elections work, so we can vote in people committed to fixing our government.
10
Politicians offered all kinds of stuff for FREE... But then... there wasn't enough money to go through with what was promised? Say it isn't so. This reminds me of the kid running for student government who offered us no homework, free pizza and ice cream every Friday. And... come to think of it... this also reminds me of Elizabeth Warren, Bernie Sanders and a bunch of the others running on the Democratic side. Free, free and free... come payback time, do we really think the money will be there for them to give us what they promised us? I don't think so. Maybe they're offering us all this free stuff in exchange for our votes? Maybe?
1
@ABC123 This was not an offer for free. This was a contract with consideration for both sides. The students commit to working in low paying but important jobs designated by the government as jobs we need some way of filling. In return for that service and proof of long term responsibility, they would gain relief from the debt. These students were paying down their debt while working in the low paying jobs.
It's the government choosing instead to burden the loan forgiveness program with loopholes and demands that were not communicated to the people on the other side of the deal. Breach of contract. Now everybody would like to choose which side to blame but it's sure not the students if you read again to pay attention to the distance between what they were told by lenders and then told by the government. They held up their end. The government instead spent a ton of money to servicers that did not service. Wherever Betsy DeVoss goes, so goes corruption. Follow the money.
39
@Meta I think you and I are on the same side of this issue. I don't fault the students. They filled their side of the bargain. I fault the politicians (Obama), who offered something (1) with very vague terms for students/graduates to be able to follow properly and where (2) the government clearly did not have the adequate funds to comply with paying these students after they complied. It was, in effect, "free pizza and ice cream for all who vote for me." The ability to then give what was promised was never there in the first place. Shame on Obama and whomever else set up that ridiculous program.
1
Bush was prez when the program was first set up.
I was there.
6
You can blame the Department of Education, and the companies in charge of servicing student loans, but the real criminals in this case are the lawmakers themselves, who created this scam/farce of a loan forgiveness program in the first place. The truth is, it was nothing but a phony program. It made the lawmakers look good, but did nothing in reality. The truth is that the lawmakers never, ever wanted a loan forgiveness program in the first place. The question is why? Who benefits from the non-existence of Student Loan forgiveness? Banks? Lawmakers? Corrupt government? Who? That’s the question that has still not been answered.
14
@Concerned Citizen I DID read it, but I am not convinced that is all there is too it. Who benefits from NOT having these loans forgiven? Someone does.
Entrusting this responsibility to a member of one of the greatest thieving families in American history was a bad idea.
5
From her Cayman Islands-registered yacht Betsy DeVoss says “Let them eat cake.”
34
Loan forgiveness is a concept with zero logic behind it. Mostly because it punishes the very frugal that took little or no loans, "eating ramen" and not doing things they could not afford.
What about if you borrowed your Mom's life savings? Will they give you money to pay her?
Add to this that you should not borrow unless you have a plan to pay back.
I am all-in for free education and even scholarships for those studying certain professions and meeting certain work requirements, but rules, obligations and benefits have to be the same for all.
77
@Ricardo Huh? Congress created the plan in 2007; your complaint about the original logic is 12 years too late. Your complaint also fails to acknowledge that a promise was made by Congress through the legislation. Whether you like the logic or not, Congress made the promise and it should be honored.
146
@Kirk Hartley Ricardo also refuses to acknowledge that the program was created to encourage people to pursue jobs that our society needs, which are not financially lucrative. Where is his vitriol for employers paying such low wages that employees cannot afford to pay student loans for the required degrees?
217
@Tautologie like most centrists and conservatives their arguments lack logic and empathy.
44
what is forgotten in this discussion is the amount of these loans. I went to the University of California at Berkeley in the late 60s and early 70s. I took out 2 loans, both from Bank of America, for a total of $2,000. the rest was paid through work/study.
in 1980 I was still paying off those loans. as I recall the payments something like 12 bucks a month? anyway I got a little windfall at that point and paid off the balances.
something is busted in this system if one of my kids is 90K in debt just for getting a degree.
233
@Claudine nothing is busted. The system is simple. Give people lip service with regards to their rights and freedoms while controlling them through student loans, convoluted health care plans, and the threat of medical bankruptcy. Tie retirement to stock markets thus giving every working person their own conflict of interest. And finally extend people enough long term credit so that they purchase for themselves a veneer of success in the form of houses, cars, vacations, and gadgets that they can't afford any other way. And there you have it, why go to the trouble of censoring people when you can make them censor themselves while also paying for the previlige.
14
@Claudine This is a tired argument. Houses in Brooklyn cost $50k in the late 60s, early 70s. Today they are over a million easily. Is something wrong with the system that says you can't have a $2 million dollar home if you can't pay for it? Or if you sign on the dotted line for it and realize later that the job you have does not pay enough to cover it, should someone come along and say you can have the house for free?
A college degree can be had for much less than $90k. There are options like commuting, community college, taking longer to graduate, living at home. But no, people want what they want and then someone else to pay for it.
I'll support the government forgiving college debt when all the people screaming for it support the government helping working people have a roof over their head and medical insurance.
3
Outrageous - completely and totally outrageous. It is a program designed to keep those who have applied in servitude until death. I have no doubt that then their children will be forced to repay the parent's debt too - endless treadmill going nowhere.
277
@fuzzpot
Most Federal student loans and those private student loans without a cosigner are canceled and the remaining balance of the debt is forgiven, if the borrower dies. So, no, at least their children will not be forced to repay the parents' Federal student debts, which are the focus of this story.
However, for private student loans with a cosigner, if the borrower dies, the cosigner becomes responsible for the debt.
The other, more insidious and shocking, bad news is that for PLUS (Federal) loans, if the borrower dies, the loan is canceled / the debt is forgiven as well, but the parent(s) — already grieving the death of a child — get hit with a Form 1099-C "Cancellation of Debt." The amount of the debt forgiven is now considered taxable income, unless the parents qualify for an exclusion (rarely), e.g., due to insolvency.
16
Fuzzpot — Children are not legally responsible for their deceased parents’ debts.
3
What happens as more and more of us boomers downsize, move to newly built retirement condos (they're all over the place), then head into nursing homes, and eventually die?
Over time, I would think there would be a glut in the housing market -- since potential younger buyers are too strapped with debt to buy homes. And it's not just real estate they'll be unable to afford --but all the goodies that go into owning a homes: new appliances, furniture, lawn mowers, cars, and on & on.
Haven't Republicans figured out this could put a real damper on the economy? It's to their benefit to solve the college debt problem because Wall Street will eventually go into a tail spin & pull everyone else down with them.
6
The only debt Trump forgives is his own...
381
@tom There are alot of things that are Trump's failures but this was failing long before he took office. This is squarely on the prior administration.
15
@DC
Both are guilty. Trump has ben office for 3 years and made no attempt to fix this. He doesn't get a free ride on this one any more than Obama does.
20
@DC
The legislation was enacted in 2007 after Blue Dog Democrats worked out a compromise with Bush the Minor’s Administration
4
And politicians wonder why people give up on their government. Incompetent and irresponsible, and worst of all - apathetic leadership.
275
@Tom Exactly. Thousands of people are out knocking on doors to get Americans to register and vote. How do you counter this kind of rank incompetence and lack of concern for people in order to convince a doubter that voting is worthwhile?
9
@Tom
“All I did was believe it was real.”
Should have studied history more. This has been going on every since there has been a federal government. For more than 200 years people who have believed federal government promises have been left holding an empty bag. At least that is how it has worked in my family, few of whom are foolish enough to believe. When they do, we put the responsibility right back on them. At some point, the person ignorant and gullible enough to buy the con deserves it.
I feel for them but not too much. What they are losing out on isn’t wages they earned, it is someone else’s wages, a handout that should have never been offered in the first place.
If your plan for repaying a loan is for it to be forgiven, then you did it to yourself.
3
@KBronson It sounds like you may be projecting your experience of Louisiana government onto the US (and maybe other states as well). My own experience of both state and federal government has been much more positive.
17
Like nearly all articles on this topic, the authors fail to make mention of the process for certifying loan payments (which FedLoan borrowers are repeatedly encouraged to do by the loan servicer), nor do they state if certified loan payments are being denied, or what percentage of rejected borrowers certified their payments.
6
Next up: massive credit-card debt defaults and subprime auto loan failures. One thing leads to another. There are too many articles about this robust economy to believe even one of them is true.
10
I was told by my loan company I had the correct loans & job that qualified for loan forgiveness but after 5 years of repaying them another company bought my loans. I called the new company to figure exactly what I needed to do with them to to continue towards forgiveness. At this time I was told that I was in the wrong repayment plan. That to qualify I would have to pay DOUBLE what I was already paying which was $400 a month! At that point I gave up because there was no way to repay that. I was told by the rep that the goal wasn’t to just forgive whatever was left over but for the loan or the majority of it to be paid off so the “forgiveness” was beside the point or minimal at best.
I got lucky that my parents helped me with an inheritance but that was a lucky break. I don’t what I would of done without them.
70
There should be a government program that offers advice to students to not take out exorbitant loans in order to get their Liberal Arts degrees.
8
Yeah. Liberal arts education is for the rich. The rest of us can have job training.
11
No mention of the total amount this forgiveness program is going to cost. Lets rewind the tape. The government was going to take over the student load program to generate a profit to help pay for Obama Care. Now we find the taxpayer is going to be on the hook for up to a trillion dollars of student loans. And you wonder why people have little faith in government.
It should be obvious at this point that our government is a failure that only has the interests of the wealthy.
46
This kind of stuff happens with bipartisan support- from democrats and republican politicians who see any area of life that has not yet been turned into a confidence scam as an untapped market. Please, anyone out thee thinking that this is was not an issue when trump was not around get a reality check. And vote for bernie sanders! Not someone who thinks that this stuff is just an accident that keeps happening. It's a feature not a bug of free market capitalism...
16
If anyone who has been caught up in the greed, deception, incompetence, and malfeasance of the student loan programs can emerge not a complete cynic I'm amazed. We desperately need well educated, public service minded, individuals and we treat them like dirt.
101
This is a shame. And we wonder why we can't recruit people to these critical jobs.
38
Yeah, my impression of people who are hanging their hopes on this program are that they have no idea how it actually works.
5
No, we knew how it was supposed to work but, if you read the article, you’ll find that the people who were profiting off this “neglected” to do their part, keeping people in unqualified programs while telling them they were qualified. The executives of those companies made millions by defrauding people making pennies. That’s disgusting. P.S. Stop victim blaming.
39
The United States of Exploitation.
69
Did betsy devos reneg? is she reneging??? Can I keep saying she reneged?
2
Forgive all student loans over 10 years old now. No questions asked. No duty requirements. Enough is enough.
362
@MIKEinNYC
Fairness?
Forgive all, those who have dutifully paid with sacrifices on their part, as well as those who have not paid at all, and all in between?
Seems that would flaunt unfairness, not a just outcome.
And neither is what is currently being mismanaged by the DOE and the loan operators and managers.
20
@FilligreeM I paid off my six-digit school loan. And I don't care if some kid who hasn't made a single payment or someone who's been struggling with school loan payments for years get their debt forgiven. Two wrongs don't make a right.
55
@FilligreeM
Life lesson: reward bad behavior - reward profligacy.
Sure that is the message we want to get out there.
Millions of student loans have been discharged without drama and 'forgiveness'
16
Please explain to me how a government who constantly creates messes like this should be trusted to be the sole provider/manager of healthcare for all its citizens. The only thing that creates an efficient and effective market for anything is competition. A monopoly, whether it is in the private or public sector, is never a successful situation for the consumer.
5
But our expensive for profit health care isn’t working. Are you suggesting that Americans just can’t do what every other first world nation has done for decades? I guess the USA is not so great.
17
@DC
You write as if our current, private, for-profit health ‘care’ system is a success.
4
@DC Maybe hold responsible the lawmakers who put those requirements for qualifying? Those requirements seem burdensome to me. Why only certain loans? I suspect Republicans put those conditions in place to make it harder to get loan forgiveness.
4
As someone who has 6 figures of law school loans still outstanding I have the utmost sympathy for the stress that this issue creates and am appalled by our government’s all-too-typical failure to address the issue.
However, although I graduated in 2014 and have always been on a full self-repayment plan, I distinctly remember being told countless times (literally hundreds..) that one needed direct federal loans and income-based repayment. I was told this by the school directly, by my peers, by my original federal loan providers and by my private loan services when I refinanced my loans. So to hear that this is creating an issue for what it sounds like almost everyone is hard to understand to say the least (acknowledging that I am but an anecdote, albeit a relevant one).
6
@Ryan
You were among the lucky ones. Do you really think that hundreds of thousands of educated professionals, many with master's degrees, aren't smart enough to follow simple directions and fill out some government forms every year?
I'll bet their tax returns are processed just fine.
The Department of Education/FSA (Federal Student Aid) OFFICIAL terminology for the for-profit, private contractors it uses for servicing and collection of student debt is they are "BUSINESS PARTNERS".
That, and the $50 billion a year in profit the government realizes from college debt, should tell you all you need to know.
16
This bears a striking resemblace to those programs after the 2008 crash that were supposed to let people reconfigure their mortgages.
And the people who were foreclosed on, despite making payments, because nobody could figure out who held the mortgage.
110
@Talbot
You mean banksters and loan service companies come out smelling like roses while confused and befuddled borrowers get manure piled on them? Again.
13
@Talbot
This prof was enacted in 2007.