Kansas judge tells government debt collectors they can't hound a broke 58-year-old woman until her 84th birthday

Originally published at: https://boingboing.net/2018/12/18/thanks-clinton.html

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I have to assume these loans were consolidated or otherwise transferred to a higher interest rate than originally charged. That growth of $1000 is about 17%.


Similarly unclear is how much of the principal is considered already paid down… if you’ve paid money towards a loan for 20 years, file for bankruptcy, and the loan amount is reduced to your original loan quantity, that’s technically better, but it’s still not really fair.

I’d hope that at least SOME portion of their previous payments are counted towards reducing that outstanding value.


Student loans are little more than predatory lending which seems to be OK if our government does it but evil when payday lenders do it.


It will be a good day when the student loan industry collapses…


… if we replace it with something better. Some form of tuition credit? Some reasonable maximum on tuition?
Free school for everyone? Okay, so long as we can maintain the quality level of education–which means that we need to pay well-qualified teachers enough to convince them to teach.

I wouldn’t be where I am today without student loans. I sure couldn’t have afforded either college or law school without them. And while I grouse every time I write a check to the DOE (and am fortunate enough to be in a position where I can write a check to the DOE every month and see my loan balance go down as a result), I’m not sure what the reasonable alternative might be.


The opinion in the Metz case is here (reached via the Richard Fossey post linked in the OP)

It appears the loans were consolidated through/with “Sallie Mae” at 9% interest.

The 9% interest on the consolidated loans is of course capitalised so the actual rate is anybody’s guess (or fiendish calculation).

This seems to be flat wrong (typo?) - the unpaid principal is stated to be $16,613.73


Under the present administration it’s not evil when payday lenders do it, either.


That was the sound of millions of securitized student loans cratering.


I think you said it yourself.


We need to stop using interest rates for student loans and just set a maximum amount owed. The interest continuing to accrue is the cause of the problem. You borrow $30k, you pay back $45k max. The investor parasites make a profit without killing the host. Oh, but that wouldn’t keep people down and make the wealthy who can afford to invest even wealthier… Never mind.


I’m proud to teach at a community college that has free tuition for everyone. It’s a viable plan, it just requires political will.


And let’s call it what it really is, not “free college,” but a tax-funded program for the betterment of all society. You know, like the military, except it doesn’t involve killing people.


I just think of it as an extension of the idea that all Americans are entitled to a K-12 education. Yes, that’s a tax-funded program for the betterment of society but we don’t really need to justify it that way because everyone is already used to the idea that we’re better off if young people have the skills and knowledge to be productive members of society.


Paying at least a portion of the loan as a grant might be an idea. If that’s not possible, guaranteeing that interest rates are low and that people aren’t forced to pay above their means are also options.

The British student loan system is vaguely sensible, although it does leave the government potentially in a big financial hole about 20 years from now.

You get your loan from a non-profit, government-owned company. Repayment is contingent on income (a certain percentage of income above a certain amount), collected through the tax system if you live in the UK. Any unpaid amount is written off 25 or 30 years after you graduate.


Or rather sooner given that the ONS just told the government they can’t get away with assuming they’ll get all the money back (until they don’t).


Once the new methodology has been implemented, some fiscal aggregates will be affected. In particular, public sector net borrowing and public sector net financial liabilities will both increase as a result of applying the new methodology. In its October 2018 Economic and fiscal outlook, the Office for Budget Responsibility estimated that public sector net borrowing in the financial year ending 2019 would rise by approximately £12 billion as a result of changing from the current approach to the new partitioned loan-transfer approach.

which would neatly wipe out our nominal Brexit buffer and push Hammond over his already reduced “reduce the deficit by 2020” target.

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