Help! Defaulted Student Loans (and other debt fun)

[PleaseBlitz]

6 minutes ago, just654 said:

This doesn’t look good.

 

2 thoughts.

 

1.  Article gives zero info on the judge’s reasoning, so it’s impossible to judge the merits. 
 

2.  I said in October you want to worry when a challenge is in the 5th Circuit and this ruling, if it gets appealed, will go to the 5th Circuit. 
 

 

On 10/21/2022 at 10:11 PM, PleaseBlitz said:

You want to worry about the 5th Circuit if they start looking hard at a case. 

 

 

Edited November 11, 2022 by PleaseBlitz

[Cooked Crack]

 

[Cooked Crack]

 

 

[Cooked Crack]

LFG Brandon

 

 

[Cooked Crack]

 

[Cooked Crack]

So the pause might be on to August

 

[PleaseBlitz]

It’s a win-win for Biden. Either he cancels $40 billion in loans and makes people really happy or he can point to the GOP (which now clearly includes SCOTUS) and blame them for blocking it. 

[PleaseBlitz]

As well documented in this thread, I graduated from law school in 2013 with $240,000 in student loans. 
 

I finished paying it off today. 
 

 

[China]

White House approves 16 million people for contested student loan forgiveness plan. Whether they see relief depends on Supreme Court decision

 

The U.S. Department of Education has “fully approved” more than 16 million people for federal student loan forgiveness and sent their applications to loan servicers, the Biden administration announced Friday.

 

The administration gave a state-by-state breakdown of the number of borrowers who have applied and been approved for its sweeping debt relief program, which is on hold until the U.S. Supreme Court decides its fate.

 

In August, President Joe Biden announced that he’d forgive at least $10,000, and up to $20,000, in federal student loan debt for tens of millions of borrowers.

 

Within months, however, Republicans and conservative groups had brought at least six legal challenges against the plan. The Biden administration in November had to close its student loan forgiveness portal after a federal judge in Texas struck down its plan.

 

Still, more than 26 million people had applied for the relief while the application was open or have been deemed automatically eligible, according to the administration.

 

The Supreme Court will hear arguments over the president’s plan on Feb. 28.

 

Click on the link for the full article

[PleaseBlitz]

16 million v 6. 
 

 

[PleaseBlitz]

https://www.vox.com/policy-and-politics/2023/2/13/23587751/supreme-court-student-loan-debt-forgiveness-joe-biden-nebraska-department-education-brown

 

The Supreme Court showdown over Biden’s student debt relief program, explained

 

Quote

On the last day of February, the Supreme Court will consider the fate of President Joe Biden’s student loan forgiveness plan.

 

The legal issues are straightforward: A federal law known as the Heroes Act explicitly authorizes the program that Biden announced in the summer of 2022, as the Covid-19 pandemic persisted. Under that program, most borrowers who earned less than $125,000 a year during the pandemic will receive $10,000 in student loan forgiveness. Borrowers who received Pell Grants, a program that serves low-income students, may have up to $20,000 in debt forgiven.

 

And yet, while this program is clearly authorized by a federal law permitting the secretary of education to “waive or modify” many student loan obligations “as the Secretary deems necessary in connection with a war or other military operation or national emergency,” it is unlikely to survive contact with a Supreme Court dominated by Republican appointees.

 

The Court will hear two cases challenging this loan forgiveness program, Biden v. Nebraska and Department of Education v. Brown.

 

The reason why at least one of these lawsuits is likely to end badly for student borrowers is something known as the “major questions doctrine,” a legal doctrine that was largely invented by Republicans on the federal judiciary, and which has no grounding in either constitutional text or in the text of any statute.

In theory, the major questions doctrine provides that, when a federal agency takes an action of “vast ‘economic and political significance,’” it must be authorized to do so by a federal law that very clearly gives the agency the power to do so. Even under this doctrine, however, there is a strong argument that Biden’s student loan forgiveness program is lawful, because the Heroes Act speaks in clear and expansive terms about the education secretary’s power to waive or modify student loan obligations.

 

But as Justice Elena Kagan wrote in a 2022 dissenting opinion, the major questions doctrine functions as less as a serious inquiry into Congressional intent, and more like a “get-out-of-text-free” card that allows her colleagues to veto federal programs that they wish to invalidate for reasons completely unrelated to what the law actually says.

 

For this reason, student loan borrowers who were anticipating loan forgiveness should think twice before making any financial decisions that assume this forgiveness will actually happen.

 

Yes, the program is authorized by a federal statute. But the Court’s GOP-appointed majority has so far invoked the major questions doctrine to strike down at least three Biden administration policies that the Republican Party opposes. And Republicans overwhelmingly oppose this debt forgiveness program.

 

The student loans forgiveness program is explicitly authorized by an Act of Congress

The Heroes Act was enacted in the wake of the 9/11 attack on the World Trade Center, to ensure that student borrowers who are impacted by a “war or other military operation or national emergency” are “not placed in a worse position financially” because of that emergency.

 

Although it was initially enacted on a temporary basis in 2003, primarily to benefit victims of the 9/11 attack and military servicemembers who may struggle to pay back their loans if they are called to active duty, Congress made the Heroes Act permanent in 2007. Thus, by making the law permanent, Congress determined that the education secretary should have broad and lasting authority to modify or eliminate student loan obligations in future emergencies.

 

 

More at link. 

[China]

40 years of debt: Student loan borrowers' struggles expose flaws in system

 

When C.W. Hamilton took out his first student loan in 1977, the Education Department wasn't even a federal agency. The $5,250 he borrowed to complete an associate's degree at Cochise College in Arizona was supposed to be an investment in his future, not a lifelong burden. Yet after more than 40 years of payments and bouts of default, Hamilton still owes almost as much as he first borrowed.

 

"It's like an anchor around my neck," said Hamilton, a 72-year-old Army veteran in Reno, Nev. "I live on peanuts. … I can never get from underneath this debt."

 

There are nearly 47,000 people like Hamilton who have been in repayment on their federal student loans for at least 40 years, according to data obtained from the Education Department through a Freedom of Information Act request. About 82 percent of them are in default on their loans, meaning they haven't made a voluntary payment in at least 270 days.

 

"This is sort of a monumental failure," said Abby Shafroth, director of the National Consumer Law Center's Student Loan Borrower Assistance Project. "There are so many relief programs in the student loan system to address some sort of financial distress. But it's this real patchwork, and borrowers struggle to navigate it. The department itself and its servicers often can't navigate it either."

 

While these borrowers represent a sliver of the 43.5 million people with federal student debt, their existence is an indictment of policies meant to help people manage their loans. Years of administrative failures and poorly designed programs have denied many borrowers an off-ramp from a perpetual cycle of debt. Even as the Biden administration tries to remedy these problems - including fighting legal challenges to its plan to cancel up to $20,000 in debt for many - the fixes could still leave vulnerable borrowers like Hamilton on the sidelines.

 

To understand how tens of thousands of people could be in debt for decades, consider the options for repaying federal student loans. When borrowers leave school, they are automatically assigned to a standard 10-year repayment plan. Others extend the period by enrolling in graduated plans that increase payments over time or income-driven repayment plans that tie their monthly bill to earnings and family size.

 

People can also temporarily pause their payments through deferment or forbearance, which can lengthen the timeline. From the time student loan borrowers' first loans enter repayment, the median length of time it takes to pay in full is 15 1 / 2 years, according to the Education Department. How much you borrow, how much you earn and whether you get your degree can all play a role in how quickly you pay off the debt.

 

Click on the link for the full article

[The Evil Genius]

Fwiw I don't think that article helps. There is a huge difference between someone having 40+ years to pay off less than what the average American has in credit card debt vs someone 100k+ in debt from college right now.

 

I am all for student loan forgiveness but I do question how someone goes 40+ years without making a dent on a 5k loan (and I read his excuses). 

Edited February 20, 2023 by The Evil Genius

[China]

Meet a borrower in the Navy who just got $323,000 in student loans forgiven and said public service was 'the only way' he could have paid off his debt

 

Jared Weegmann no longer has a six-figure student-debt load hanging over his head.

 

After getting his undergraduate degree from a public Florida college, Weegmann, 37, decided he wanted to go to law school — and the only way he could do so financially was by taking out student loans. But after graduating University of Miami's law school in 2012 with around $200,000 in debt, the most important thing for him at the time was getting rid of that debt one way or the other.

 

"This debt will never be repaid," Weegmann said. "I just remember thinking, the only way this is ever gonna get off me is if I immediately start some public service job."

 

Weegmann is referring to the Public Service Loan Forgiveness (PSLF) program, which is intended to forgive student debt for public servants, like government and nonprofit workers, after ten years of qualifying payments. He saw the Navy as a viable option to start the clock on his public service in 2013, and at that point, his estimated year for loan forgiveness was 2024. 

 

But President Joe Biden's Education Department implemented a limited-time waiver last year to allow previously ineligible payments to count toward PSLF progress. That was instrumental for Weegmann — on January 2, 2023, he received a letter from student-loan company MOHELA informing him that his $323,000 student debt load had been fully forgiven.

 

Click on the link for the full article

 

Edited February 20, 2023 by China

[TheGreatBuzz]

Wow.  Sounds like part of the solution to low recruitment numbers. 

[Dr. Do Itch Big]

I considered joining the Air Force to help pay for school. 

[TheGreatBuzz]

There was a strong correlation between my best Sailors and those that were using the military to pay for their college education. 

[CousinsCowgirl84]

5 hours ago, China said:

Meet a borrower in the Navy who just got $323,000 in student loans forgiven and said public service was 'the only way' he could have paid off his debt

 

Jared Weegmann no longer has a six-figure student-debt load hanging over his head.

 

After getting his undergraduate degree from a public Florida college, Weegmann, 37, decided he wanted to go to law school — and the only way he could do so financially was by taking out student loans. But after graduating University of Miami's law school in 2012 with around $200,000 in debt, the most important thing for him at the time was getting rid of that debt one way or the other.

 

"This debt will never be repaid," Weegmann said. "I just remember thinking, the only way this is ever gonna get off me is if I immediately start some public service job."

 

Weegmann is referring to the Public Service Loan Forgiveness (PSLF) program, which is intended to forgive student debt for public servants, like government and nonprofit workers, after ten years of qualifying payments. He saw the Navy as a viable option to start the clock on his public service in 2013, and at that point, his estimated year for loan forgiveness was 2024. 

 

But President Joe Biden's Education Department implemented a limited-time waiver last year to allow previously ineligible payments to count toward PSLF progress. That was instrumental for Weegmann — on January 2, 2023, he received a letter from student-loan company MOHELA informing him that his $323,000 student debt load had been fully forgiven.

 

Click on the link for the full article

nice that lawyers who earn fat checks are getting their loans forgiven….

Edited February 20, 2023 by CousinsCowgirl84

[PleaseBlitz]

I think this is kind of a weird example of how the program should work.  More from the article:

 

Quote

"It was basically indentured servitude to pay off my debt," Weegmann said. "You have to take on a lot of stress, but I learned a lot too, and it gave me a good, stable job to get to have money to make the investments that are going to propel me into the future."

 

"But I don't think that the juice is worth the squeeze or the payoff, if getting the degree is worth it," Weegmann added. "Because if you don't do public service, you're going to be saddled with that debt. I mean, how long would it take to pay that off? Probably never."

 

First of all, **** man, indentured servitude?  I guess, in the sense that every job ever is indentured servitude when you have debts.  You other option was get good grades in school and then go make bank at a giant law firm (like I did along with thousands of others) and pay off those loans in roughly the same amount of time.  

 

I opened the article hoping to see that he was doing great things as a JAG, proud of his service, and grateful for having his loans paid off.  1 out of 3 is pretty disappointing.  

[just654]

Student Loan forgiveness just struck down 6-3

[PleaseBlitz]

No surprise there. 
 

Hopefully the 16 million young people will go vote next year. 

[ixcuincle]

Colleges be crazy though making so much off football and then having the audacity to jack up tuition the f***

Our society makes it so you can't do nothing without no degree. But then to get one you need to pay out the ass. 

 

 

[ixcuincle]

 

 

[CousinsCowgirl84]

It is a little interesting that republicans understand the concepts of investment regarding money but are completely clueless when in comes to investment in people. You could try to write it off as they only care about themselves, but if they understood the concept of investment regarding people they would know that it’s actually in their own self interest to invest in people and get them returns (lower crime rates, fewer people on welfare, more productive work force, more entrepreneurs, larger amounts of disposable income) but they just don’t seem to understand the concept at all.

Edited June 30, 2023 by CousinsCowgirl84

[Captain Wiggles]

Corporations are people tho. See Citizens United. 🤪