By Alan Collinge
An in-depth exploration and expos? of the predatory nature of the scholar personal loan industry Alan Collinge by no means imagined he could turn into a scholar mortgage justice activist. He deliberate to land an effective task after university, pay off his scholar personal loan debt, after which easily omit the loans ever existed. Like hundreds of thousands of usa citizens, notwithstanding, despite operating not easy, Collinge fell in the back of on funds and entered a labyrinthine pupil mortgage nightmare. High college graduates can now not positioned themselves via university for a number of thousand cash in mortgage debt. at the present time, the typical undergraduate borrower leaves college with greater than $20,000 in pupil loans, and for graduate scholars the common is a whopping $42,000. For the earlier 20 years, collage school has elevated at greater than double the speed of inflation, with the price principally moving to scholar debt. The scholar mortgage rip-off is an expos? of the predatory nature of the $85-billion pupil mortgage undefined. during this in-depth exploration, Collinge argues that pupil loans became the main ecocnomic, uncompetitive, and oppressive kind of debt in American background. This has happened largely because of federal laws handed because the mid-1990s that got rid of general client protections from pupil loans-and allowed for large consequences and draconian wealth-extraction mechanisms to gather this inflated debt. Collinge covers the heritage of scholar loans, the increase of Sallie Mae, and the way universities have profited on the fee of scholars. The publication comprises candid and compelling tales from humans around the kingdom approximately how either nonprofit and for-profit pupil mortgage businesses, aided by means of terrible laws, have shattered their lives-and livelihoods. With approximately five million defaulted loans, this challenge is turning out to be to epic proportions. The pupil personal loan rip-off takes an unflinching examine this unparalleled and urgent challenge, whereas exposing the robust organisations and people who brought on it to ensue. finally, Collinge argues for the go back of normal buyer protections for pupil loans, between different pragmatic recommendations, during this clarion demand social action.
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Additional info for The Student Loan Scam: The Most Oppressive Debt in U.S. History - and How We Can Fight Back
A simple glance at Sallie Mae’s stock chart over the past decade as compared to standard stock-market indices for the same time period conﬁrms the company’s tremendous growth. It is very telling that its stock price actually accelerated in the aftermath of the dot-com recession. Indeed, between 1995 and 2000, Sallie Mae’s stock price increased by nearly 1,700 percent. Between 1997 and 2006, Sallie Mae’s loan holdings grew from $45 billion to $123 billion. C. According to conservative estimates by Bethany McLean of Fortune magazine, Albert Lord had made in excess of $224 million dollars in compensa- 23 24 The Student Loan Scam tion.
This legislation allowed massive penalties and fees, and Congress permitted the industry to use draconian collection methods to recover this increased debt. Most of these congressional giveaways to the industry were included in the 1998 amendments to the Higher Education Act and were pushed ﬁercely by the student loan industry. “In American history, this is the most outrageous giveaway ever extended by the federal government to private lenders,” says Barmak Nassirian, associate executive director of the American Association of Collegiate Registrars and Admissions O‰cers.
It is no secret within the industry that the collection powers it has been aƒorded are without rival. Stories of senior citizens having their Social Security income taken, people with terminal illnesses having their disability income attached, members of the working poor having their wages garnished—usually just to cover fees and interest on their debts—are widespread. However, recent evidence suggests that the collection industry has superseded even those powers provided by Congress for collect- Collection Abuses ing on student loans; it has engaged in widespread abuse and taken outright fraudulent actions against borrowers.