The Debt Collective, Student Debt Strike Gaining Momentum

I am not posting this for support I am simply bringing this topic to the boards for discussion as I believe it is an important political movement that may impact the future of this country.

Source

If you owe the bank a thousand dollars, the bank owns you. If you owe the bank a trillion dollars, you own the bank. Together, we own the bank.

I have to say I was first intrigued by this little slogan. I don't know if I agree but at the very least its interesting.

The Debt Collective helps people organize with each other to challenge creditors. We believe no one should have to go into debt for basic needs like housing, healthcare, and education. When the indebted join together they can build power to help create a just society.

Apparently students began organizing after the Corinthian 15 Debacle.

The so-called Corinthian 15 claim Corinthian's schools lured them into enrolling and taking out loans by advertising false job placement rates. The borrowers are relying in part on the master promissory note, which acts as a contract between student borrowers and the federal government, that they signed when they took out the loans. The note contains a provision that may cancel borrowers' debts if they can show that misrepresentation led them to take out the loans.

So what did the students decide to do... start a movement.

If you refer back to the first source above you'll notice a ticker at the bottom.

911 members for Sallie Mae and Navient and 1392 members for Corinthian15.

These people are getting a lot of support from alternative media sources and members from Congress.

U.S. Students Granted Up To $3.5 Billion In Debt Relief

And as a results of the actions taken by these students...

It’s an unprecedented move in higher education, but a welcome one. The U.S. Secretary of Education has pledged to forgive the loans of as many as 350 thousand students who were defrauded into taking on huge student loan debts by online schools owned by Corinthian Colleges.

Enjoy!!

Well, I can see the students getting some support if they can show the job placement rate was indeed a lie. Otherwise, they don't own the banks, and if the banks stop offering loans, no one is going to college except the rich.

a reply to: OccamsRazor04

They already got support.

Lots of talk in congress and from students about the student debt issue. I think we can all mostly agree it's out of control and for profit corporate educations are not comparable to educations that are genuinely for the students.

a reply to: onequestion

Cool. I'll support their movement when someone sends me a check for 40k or 100k or whatever.

They borrowed the money, they spent the money, they owe it. I don't believe for a second any one of them was conned.

a reply to: onequestion

I blame students just as much as anyone else. I graduated debt free.

a reply to: Ameilia

Yeah 18 year olds are perfectly capable of making these descisons.

What a joke

If a contract is entered into by either party making fraudulent claims or being deceptive then the contract is null and void.

Having government guarantee loans and remove bankruptcy provisions allowed abuse on a large scale both in tuition costs and loan criteria.

Formerly a student and school would be vetted for results.

Now it's free for all because except in rare cases such as in the OP schools and banks can't lose regardless of students ability to pay loan, exorbitant school costs to begin with and banks free ride on underwriting.

You folks are in debt 10X what should be for the selling of "education for all" to the public.

Get government out, do traditional underwriting at banks and tuitions will fall if educational institutions want to stay in business. Yes both students and institutions will have to provide marketable results.

As it is, slave like debt till well into your thirties and forties if you are fortunate to have picked a marketable education in the first place.

Crazy!!! IMHO

These for profit colleges like Corinthian where allowed to flourish. Once the government made student loans available, that's when the flood gates where opened and schools like Strayer (that is promoted by Steve Harvey) really started racking in the dough. They are all about keeping enrollment flowing, you see that. That online college had 350,000 students. Profits in the millions, I wonder if all that money can be taken back.

Meanwhile, not only is an education at the community college a general better quality but is also vastly cheaper.

a reply to: cenpuppie

People just don't know what they are doing anymore the Internet has broken the human mind.

a reply to: onequestion

It is a good subject - and approach to another bubble on the horizon.

This is neither a new problem or a new solution.

I'm trying to remember where I first heard the idea that it was the debtors and not the creditors that held all the power in the relationship. It was many years ago and will see if I can find a source.

That said, debt forgiveness does work and it works all the way around.

If in 2008, if the 'bail-out' have been directed targeted at homeowners in trouble it would have solved both the debitor (homeowner) and creditor problem. The money would have 'trickled up' taking care of the 'liquidity' crises and saved millions of homes. It would not be a quick fix (short term thinking) but a gradual systemic fix (long term consequences.

That is where I see the fundamental problem the battle between chaotic 'short-term bottom line' and stable 'long-term sustainable health'.

There's a Tom Clancy book, can't remember the name, where a cyber attack takes out the stock market around the world. The final solution - turn back the clock to before the attack.

a reply to: FyreByrd

Yeah why wouldn't they just lay off the debt with the bailout solving all problems at once?

Seems easy for me to understand.

originally posted by: onequestion
a reply to: Ameilia

Yeah 18 year olds are perfectly capable of making these descisons.

What a joke

I was, so were many others.

To imply all 18 year olds are stupid based on the fact that some of them made poor decisions isn't fair.

a reply to: Ameilia

What about someone in my position. I borrowed the money, yes. I did not really spend it. I owe $10,000ish for an education I did not receive.

Let's backtrack a little. I grew up relatively poor. Not in poverty really, but money was tight, very tight at times. My mom, a single mother, made too much money to qualify for any assistance but not enough to set aside anything for any kind of college fund, or you know buy food occasionally.

I finished high school and got into some very good colleges, but had to scrap those plans because I simply couldn't afford them. So I decided to go to a state school. Turns out I couldn't afford it either, but I didn't find that out until after I got there. I took out a couple student loans to cover what wasn't covered by other financial aid and should have been set. I go there for a month or so and around the time I was supposed to have my financial aid disbursed, yay I could finally buy books and other much needed supplies or so I thought, I got a bill for $4,000. So I left college and got stuck having to repay the loan with nothing to show for it.

Same damn thing happened with an online college later, but at least I got a couple credits out of that one. A couple thousand dollars in debt for two classes worth of college credits, but hey, credits are credits I guess.

The American education system in it's current form is a racket as far as I'm concerned.

originally posted by: OccamsRazor04
Well, I can see the students getting some support if they can show the job placement rate was indeed a lie. Otherwise, they don't own the banks, and if the banks stop offering loans, no one is going to college except the rich.

It used to be possible to afford college on nothing more than a full time low wage summer job. No loans, no scholarships.

Getting the government/banks out of college funding is a way to return to that, given time.

originally posted by: OccamsRazor04
a reply to: onequestion

I blame students just as much as anyone else. I graduated debt free.

I agree, students share some of the blame (I too am debt free on my first 3 degrees... we'll see about this one). At the end of this past semester just before summer started I was talking to a freshman, she had just turned 19 and finished her first year of college (on academic probation and with two major changes so nothing at all to show for it). She told me she started the school year with $15,000 in debt. After the school year (mind you, this is the least expensive school in the state, and possibly country) she was up to $65,000 in debt and projected to hit $220k by the time she graduated in another 4 years.

I just sat there thinking, I attended that school full time. Worked a little bit to cover my rent, and my tuition for the year was $8000 which I paid entirely out of pell grants and what I could save. Total cost between tuition and living expenses of 13k.

How did she take out $50,000 in loans and then I realized it. Lots of books, two laptops, a nice apartment, a top end phone with all the extras, tuition, 3 meals a day at the school cafeteria, and others. And then she didn't work at all to defray any costs.

Sometimes students make very bad decisions, in a world where things went right the bank would step in here and stop supplying money, but that's not the sort of system we have. For that matter, in a good system the school wouldn't be putting money traps out there like encouraging students to buy meal plans in the cafeteria at $15/meal (there's a very nice grocery store right across the street).

The federal government is in on the scam. You cannot claim bankruptcy on student loan yet big corporations claim bankruptcy all the time. Higher education is now in bed with Corporate prisons.

originally posted by: HUMBLEONE
The federal government is in on the scam. You cannot claim bankruptcy on student loan yet big corporations claim bankruptcy all the time. Higher education is now in bed with Corporate prisons.

Want to hear a neat fact? The big push from Obama has been community colleges. Giving people a two year education for free through them. There's just a couple small problems. If you go by income demographics having an Associates is actually worse than having no degree at all. You spend the time in school but you make less money than someone who didn't. Also, if you try to take the degree to a 4 year as part of a transfer you'll find that maybe only 1/4 of your classes will transfer. So you spend 2 years to get what you could have had in a semester elsewhere.

a reply to: Aazadan

I agree mostly with your comment, but the whole idea of loaning money is to enslave someone to debt, profit is made from the intrest, the bank needs the intrest figures to keep its whole "hedge fund" scam rolling.
the more loans that are in circulation means more intrest repayments means more projected profit, it's a pretty basic concept.
It's the same scam that destroyed so many people's lives in America and saw thier homes foreclosed.
If anybody believes this scam wasnt real and wasnt aimed to target this specific demographic as was the age specific demographic in the homeowners scandal then thier is no hope, and it's not hard to understand why the banks got bailed out and no arrests were made and no investigations were conductded.

a reply to: PLAYERONE01

That's why one of the potential solutions I favor is returning bankruptcy protections to student loans. Then I propose taking it a step further. Rather than banks or the government financing these loans they would be offered directly by the university. This gives them an incentive to compete through minimizing costs and giving favorable loan terms. And it means that their long term survival can only happen if their graduates get good paying jobs to repay those loans.

I can so relate to this, some time ago I attended one of the Art institute's. I too ended up in debt with nothing to show for it. See I was lured in and guaranteed loans and financial aid and all that, it sounded great. Well my credit was good enough to get me loans for about 3-4 semesters. For the first semester I did online classes,the next one I commuted and the next three I lived in student housing which in hindsight was a pretty costly decision but it was a nice experience living in a big metropolitan area for the first time.

I also worked full time in retail while going to class full time (fun YAY no life) and managed to keep a B average the whole time. So things are going good and this is even where I met my ex-wife lol. So I eventually find out that the field of study I'm "learning" is not even accredited at this particular branch, thats when I learned all about accreditation and all that. Ok so no biggie I switch my majors, cool now I feel good again and I'm on my way.

Well at about my 5th semester I find out my credit power is no longer able to keep getting me loans to finish school. So naturally I go to my parents who reluctantly co-sign for my loans. I didn't finish the next semester, by this time I had realized that this school was basically a pay for your degree kinda deal. Being an institute as opposed to university it was geared more for those who already were pretty adapt in their fields to come and practice with equipment. Lets just say the teaching staff is mediocre at best.

So now I don't feel like I'm learning anything, I'm anxious about not learning anything and/or screwing up somehow and wasting my parents money or not being able to pay them back because I can't get a job with my crappy degree. I was also having some roommate issues which housing refused to back me up on despite being senior housemate. The cherry on it my ex-wife then girlfriend was having some gastrointestinal issues. I had a buddy who had joined the Marine Corps and urged me to do the same. I did and I married my girlfriend about a 7-8 months later so she could go to the doctor. I really loved and care about her, even that did not pan out in the long run. She ran away with my heart all to chase a high.

On the bright side I still have my G.I. Bill but I have reaffirmed what I always knew on my first post Corps return to school. I am horribly stupid at math, I mean it's bad I can't even pass remedial math to get to college level. It's like some sort of block in my brain. Anyway I've managed to pay down most of my loans with some help from my parents. It was sallie mae that got me and it is Navient that I currently answer to. I'd like to add too that the way it worked was weird to me but their were two different backers for the loans (well many micro loans really) federal and private. Now the private side debt collectors were ruthless and nasty people and relentless. Dealing with the federal side of the loans not too bad they actually work with you. I have had a few forbearance's and deferments.

So that is my how I got stuck with college debt and no degree story. Judge me if you will but life happens everyday, you just learn from it daily and move on.