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Conspiracy by Federal Loan Providers to deny your education.

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posted on Jun, 12 2008 @ 08:09 AM
Alright so check this out, yet another unfortunate reality exposed via living my life and experiencing society. I've been a College Student on and off attending for 5 years, then stopped attending for 2 years. During the 4th year, I had to drop below part-time status, that is, I was only taking 2 classes a Semester, instead of 3 to be considered part-time status.

Well, low and behold, in the Federal Student Stafford Loan fine print it says that if you drop below part-time status, your 6 month post-graduation leniency period where you do not have to start making payments begins to count down. They didn't even inform me of it when it began, I only knew I had lost my 6 month leniency period after it was already gone.

So then, here I was broke, depending on these loans for tuition, and now my 6 month period is gone and I cannot get another loan until I am at least part-time again for one whole Semester. That means i'd have to pull a Semester of Tuition and Books out of my rabbit's hat, which is like .. ooh... $1000 for 3 normal classes. Obviously dependent on the system to begin with, I didn't have that kinda money. I'm 2yrs behind on paying now technically because of that stupid sneaky policy as well.

So I was forced to stop attending College until a later date. This was 2 years ago. I am two part-time semesters away from attaining my Degree too, isn't that funny. Now I have this stupid collection service leaving me messages on my parents' phone asking to talk to me about "my property", then listed the house I live in on the msg, which is my mother's house that I currently live in. This aint my property?! And with Federal loans, theres no co-sign, my mother does not have to pay my debt via her property, don't get the wrong idea, a Federal Student loan isnt like that and doesnt require a co-sign.

But I must say, the nerve to even mistakenly think this is my property, I mean come on, I can't even finish school and your dumb little loan providers stupid rules and inability to inform me screwed me out of being able to attain another student loan, especially now. While this doesnt matter in itself because I decided I was going to keep my student loan debt under $10k U.S. and pay anything else out of pocket. It's at 6 to 7k now, and since I only need about 7 classes split into two Semesters, as soon as my money situation straightens out this summer, by teh fall it will be on, I'll be finishing it with my own money.

It just really ticks me off that these guys are becoming predatory on STUDENTS with no credit history who have NOTHING! Your dumb policies even forced me OUT of College! Student loans my arse .. good luck trying to keep one, unless you're one of those full-time, stay at Campus for 8 hours of classes a day types.

I wanted to add that I've become so incredibly disappointed about the state of our nation, the banking system, the credit system, the student loan system, all of it, traps. We really need a change. Not to endorse anyone, but Obama has spoken many times about allowing students to do community service work to earn tuition money. Now wouldn't that be great? I'd be one of the first to sign up. In this way, I'd be a productive citizen finishing my education faster, thus getting me into a job faster where I can benefit a company, and I'd be doing community service work to "earn" it, probably a hospital or the SPCA. I mean .. to me its' a no-brainer.

[edit on 6/12/2008 by runetang]

posted on Jun, 12 2008 @ 08:18 AM

Originally posted by runetang
in the Federal Student Stafford Loan fine print it says that if you drop below part-time status, your 6 month post-graduation leniency period where you do not have to start making payments begins to count down.

I feel your I too have very large student loans to pay back....but, and there's always a "but"..

The condition I've quoted above is clearly disclosed and in the same size print everything else is printed in. A good deal of the responsibility for your predicament rests squarely on your shoulders now.....dumping it off on someone's "sneaky" practices doesn't quite seem right. After all, you signed the promissory note.

posted on Jun, 12 2008 @ 08:23 AM
So, you screwed up, and it's the system's fault?

Sorry, it's none but your own. Next time read every single word before signing anything. Get two jobs if you have to, and clean up your own mess. Plenty of people have done it before you, and plenty will afterwards.

posted on Jun, 12 2008 @ 09:25 AM
Didn't they make you go to loan orientation your first semester of having a loan?
I know they made the terms abundantly clear to me.
Also, I thought it was pretty common knowledge as a lot of students discuss it with each other on campus.
Sounds like you fell through the cracks (receiving info) but not conspired against.

posted on Jun, 12 2008 @ 01:09 PM
Heck no, there was no loan orientation.

I guess I shouldn't have posted this.. coulda figured that unless it happened to one of you, you wouldn't understand and just tell me I'm a screw up.

Well, they sell the dang loans on the promise of "your payments are not due until 6 months after graduation or dropping out". It's somewhere else in the booklet of fine print somewhere that it stated going under part-time status is considered the same as dropping when it comes to the 6 month period.

It also stated that they will inform you that your 6 month period has begun via mail. They never did this. This is the main gripe. It really caught me all be surprise, they didn't tell me, the loan people @ the school, nor the provider.

So then, the conspiracy i am claiming exists is not informing students that their 6 month period has begun, effectively tricking them because they are still enrolled, thinking they'd receive the notification promised if that were so. But they dont, and then it's over, and you cannot get another loan when you go to sign up for your next semester of class. You've been taken out of the system, you are no longer eligble for a student loan until you entirely pay off the one you have I believe, or begin payments (how when you cant pay for tuition, thus getting the loan to begin with?). It worked on me.

Also, if you tell me the student loan industry isn't tapped, being an extension of the banking industry, and having received numerous cuts to its federal budget over the past two presidential terms, i'd tell you that you are completely unaware of the politics around this. They want less kids on student loans because its less money they have to pay out. Don't you understand thats why that rule exists? And also, why they didn't inform me so I could do something about it before it was too late?

[edit on 6/12/2008 by runetang]

posted on Jun, 12 2008 @ 01:37 PM
Loan people get rich of their customers.
The system is set up to make you a debt-slave even before you actually enter the world of working slaves. Ofcourse they will not help you.
Ofcourse their S.O.P. is to unwittingly entice people with unclear contracts.

posted on Jun, 12 2008 @ 03:13 PM
reply to post by runetang

Ummm hate to break it to you. But this is kinda common knowledge and most college students that get a loan usually know this. I know I talked about it with the loan officers, as well as my parents at lenght before even considering getting a loan. Which is why I made sure I either a) paid in full or b)got a scholarship/grant which would pay for tuition without the same types of consequences that a loan gives.

Yes, I ultimately did have to get a loan, but I made sure that a) I knew what I was getting into and could pay for it and b) that it was the absolutely last resort and that it would be so low an amount that it wouldn't cause a big dent in my bank account. Does it suck? yes it does, but you can't expect BANKS of all places (which is ultimately what Sallie Mae is) to just hand you money for free. Although they are always glad for you to always give them money for free so they can "keep it safe" right?

Either way, live and learn kid. If you didn't know this before, now you do and you can pass this on to your kids so they don't make the same mistake.

Edit to add: this isn't a matter of "I knew what you'd reply, but you wouldn't get it until it happened to you too" It's silly to say this because a number of us have gone through a similar situation as yours when we signed up for a loan. The only difference I see is that most people obviously bothered to ask more questions instead of just ASSUMING the bank would just give you the loan money and not bother to enforce their own rules (full time versus part time student etc.)

[edit on 12-6-2008 by Question]

posted on Jun, 12 2008 @ 03:21 PM
You are correct that they're supposed to inform you that you've started your "grace period" and I did receive that notice. While they obviously want to make money off people (why else loan out money?) I still think you were someone who fell through the cracks. On the whole I doubt this happens a proportionally large number of times. If you can find a lot of people this has happened to you might just have a conspiracy on your hands.
I'm not calling you stupid....just unfortunate.

posted on Jun, 12 2008 @ 03:38 PM

Originally posted by mysterychicken
You are correct that they're supposed to inform you that you've started your "grace period" and I did receive that notice. While they obviously want to make money off people (why else loan out money?) I still think you were someone who fell through the cracks. On the whole I doubt this happens a proportionally large number of times. If you can find a lot of people this has happened to you might just have a conspiracy on your hands.
I'm not calling you stupid....just unfortunate.

Even so, even if he wasn't informed that his grace period had started. He should've known that this was going to get to him eventually. Once I shifted to part time student instead of full time, I knew right away that I shouldn't be sitting comfortably and letting everything go by. Funny thing when you get a loan, at least in my case. When I ended up borrowing this money, it kept nagging me at the back of my head, and the nagging became even louder once I switched to part time, so when the letter for my first bill/invoice showed up in the mail, I knew right away and wasn't too shocked. Maybe it was because I wasn't actually expecting them to give me any sort of notice, they had already told me about it earlier, and so had my father, so what more warning did I need?. I'm thinking the OP should've maybe taken this a little bit more seriously. Should've called them up if he was unsure. But it doesn't seem like he did anything except wait until it hit him square in the face. Like I said, live and learn, he made a mistake, no problem, it happens to everyone, now he'll just have to re-adjust to fix it and make sure that he learns from it so that his kids don't go through the same thing.

No, I actually didn't get to hear about my notice either because I had all my mail going to my paren'ts house in GA. It's more reliable since I was moving too often where I was, so I rather it went to a more stable address. So I didn't even get to hear about my notice until many months afterwards.

[edit on 12-6-2008 by Question]

posted on Jun, 12 2008 @ 05:57 PM
Sorry but ignorance is no excuse here. I paid my way through college (Worked nights and played 4 years varsity football) as well as my wife who has two masters degrees. It was nothing but hard work for the both of us and I don’t miss it one bit. The fine print is not the worse thing on a student loan. The killer is knowing you have to pay it back when you graduate and you don’t even have a job yet. It kind of goes against the banking worlds principles handing out money with little or no collateral and no primary income source in sight but they do love to get us hooked onto to their credit system as soon as they can.

posted on Jun, 12 2008 @ 11:30 PM
yah well naive 18yr olds with no credit history, when coupled with an inadequate, downright sorry arse student loan dept at the school, sometimes make poor decisions.

im not going to reply again, but let me just say that the "loan officers" (actually students on work-study program; arent getting paid cash in hand and are about as reliable as the drive-thru lady @ mcdonalds) never told me dropping below part-time would initiate the grace period. They only said that you had to be going part-time to be eligible to get the loan. btw. i dropped below part-time for like 1, maybe 2 semesters, and went right back up to part-time again. a number of months later, im applying for the next semester's loan when to my horror they tell me THEN ... no scratch that, the loan dept was too ignorant to know what was going on, I had to call the loan provider, the lender themselves, and they explained in a lengthy phone convo.

so say all you want about ignorance, but the same thing could've and would've happened to you, had you been in my identical situation, dealing with the identical inept people i dealt with at this local community college in question. they even LOST one of my loan apps one time, after i saw them file it a month prior. that semester is the one i had to drop below part-time status because i had no loan money cuz they lost my loan app and I had to re-submit one the next semester; it was their mess-up they admitted it too, but it was too late for a loan b/c of it that semester. had to borrow tuition from a family member because of it, only was enough money for 2 classes, so i went below part-time once. then the next semester i was back up to part-time. no one ever told me a thing, not even when getting my 1st loan.

this is my last reply because this thread is becoming worse and worse, this isnt supposed to be a thread CRITICAL OF MY DECISIONS, it was supposed to be a generic discussion and I used myself as an example, thats it. But I will end my post with: YOU try dealing with an inept, ignorant loan office that loses loan app's, causing your problems to begin with. You try picking up the pieces after you had no idea what happened until after it happened. I was in school the ENTIRE TIME MY GRACE PERIOD WAS GOING BY. No letter, and the Loan dept, with ONE TRUE OFFICER, and the rest are work-study-student-employees, never even knew jack to begin with. Yes, thats right, you never even get to talk to the SINGLE loan officer, the lackies deal with you, and they're under-paid, insignifcant for the task, and just crap. Can you see now why im pissed? I'm not racist, but the entire staff were african american women under 30yrs old from poor neighborhoods with poor speech abilities, impatient as heck, forced to work in the loan dept to get their tuition through a special program. they were fellow students and often times would be chattering away with each other about class related things. Their goal was always "get the person in and out ASAP so they have more free time to BS at any given moment all day long".

So while im gone, feel free to chime in and call me ignorant or claim i made ignorant decisions like most other repliers, tell me how wrong or bad I was, completely missing the point of the thread. It is the true colors of the archetypical ATS member in action, and I could expect nothing better. I made this to discuss possible student loan related conspiracies, I was hoping to hear other disgruntled students give examples too, but I should've known better. Not for everyone poking at me about how *I* messed up so bad. Like I said, you try dealing with those freaking losers. Now I can understand why people go off the rocker and take out entire offices.. dumb people ruin other people's lives when they fail to do their jobs properly.

Yes I'm saying you all like to fall in line behind #1, and are swayed/influenced/intimidated by fellow posters into jumping on bandwagons. It's an opinion not an insult, much like alot of your comments are opinions, even though they bother me. But they bother me because I know they are wrong, I'm driving this car. That doesn't mean im completely self-righteous but I know an injustice when I see one, and I also know how to accept my own mistakes, no matter how large, humbly, and have done so numerous times. This is not one of those times.

PS: I wanted to add that I had taken entire semesters off before with no problem, it never triggered my loan to begin the 6 month grace period. Often times I'd skip one semester a year, taking two semesters of classes, there being three semesters in a given year. So why would I or should I know at that moment in time that going less than part-time status will trigger the grace period? Heck, not going doesnt? But taking 2 classes does(less than part time status)? Whatever you say. Keep buying into their "You should've known better" mentality, thats what the Bankers want you to keep saying. Just remember to keep saying it while you are foreclosed on, your car is being repossessed, and when you lose your job, if you even have one.

[edit on 6/13/2008 by runetang]

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