Americans owe over a trillion dollars in student loan debt. These facts will leave you scratching your head…
- If you have student loans and you die, your family can get the bill. If your loved ones co-signed a loan for you, your untimely death could mean major debt issues for them. One family found this out the hard way when their son at Duke Law passed away. The absurdity is not limited to the death of students either. If your cosigner dies, your loan could automatically go into default.
- The Senate has special programs that provide up to $500 per month to aid student borrowers. The program provides up to $40,000 lifetime in student loan payment assistance. Unfortunately, only Senate staffers get this perk. Beltway outsiders are out of luck.
- The rules that apply to borrowers don’t apply to lenders. Bankruptcy is nearly impossible for people who want to get rid of their student loans, but lenders can declare bankruptcy. Lenders are free to buy, sell and transfer loans, and borrowers have no way of preventing it.
- Programs to help borrowers, like Public Service Loan Forgiveness, could be on their way out. Last month President Obama unveiled his proposed budget for the upcoming year. It included major cuts to the Public Service Loan Forgiveness Program. Republican lawmakers have also proposed similar provisions.
- For-Profit schools bank huge profits by misleading students at every turn. One for-profit school allegedly falsified employment data, forced students into high interest private loans, and compensated their financial aid staff based in part on the number of students that signed up for these private loans, according to a lawsuit filed by the Consumer Financial Protection Bureau.