marmar (1000+ posts) Wed Dec-29-10 04:15 PM
Original message
For-Profit Colleges Slump Converges With Debtors
Dec. 28 (Bloomberg) -- Ronnie Franklin borrowed to pay his tuition at a for-profit college that advertised its success in preparing graduates for better jobs. That decision haunts him.
Frustrated that his degree didn’t lead to work in electronics, Franklin -- now a $12-an-hour housepainter -- decided to go to a community college this year. He can’t qualify for a federal grant that would have paid the cost because he defaulted on $20,000 of his earlier U.S. student loans.
Debt from a for-profit college education also shadows Christina Bergschneider and Michael DiGiacomo. Landlords rejected Bergschneider’s apartment applications more than 20 times because of her unpaid student loans. DiGiacomo, who works in a copy shop, forfeits 15 percent of his after-tax income when the U.S. Education Department garnishees his paycheck to collect on $30,000 in federal loans for two different for-profits.
Students seeking to move up in life by getting a degree from a for-profit college are being trapped in a growing underclass of education debtors. Under U.S. law, their loan obligations can rarely be discharged in bankruptcy, making them more onerous than credit-card debt or subprime mortgages taken out before the housing bubble burst. Along with blocking students from further education and access to housing, defaults can subject them to government confiscation of tax refunds and Social Security payments, as well as paychecks. ............(more)
The complete piece is at: http://noir.bloomberg.com/apps/news?pid=20601109&sid=aa...
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=439x89038KansDem (1000+ posts) Wed Dec-29-10 04:24 PM
Response to Original message
2. "Under U.S. law, their loan obligations can rarely be discharged in bankruptcy"
I often wonder why this is. If you can discharge credit card debt and mortgages in bankruptcy, why not student loans?
Hannah Bell (1000+ posts) Wed Dec-29-10 04:25 PM
Response to Reply #2
4. because that would spoil the ruling class plan to entangle the bottom 50% in debt &
send them off to debtors prisons for use as slave labor.
No, Hannah who needs a ball-gag Bell. The reason is simple. The Fed backs up most student loans, and they will get their money from you.
aikoaiko (1000+ posts) Wed Dec-29-10 05:16 PM
Response to Reply #2
7. Because a lot of students would graduate, hang out at the their parents house unemployed, and then .
...file for bankruptcy.
DUmmies do that now, and just hide from the creditors.
Hannah Bell (1000+ posts) Wed Dec-29-10 05:20 PM
Response to Reply #7
8. yes, that must be it.
You forgot the sarcasm smiley, twit.
Hannah Bell (1000+ posts) Wed Dec-29-10 04:24 PM
Response to Original message
3. The wonderful results of the free market in education. The poor get useless degrees and endless
debt, for which they can now be imprisoned.
ah, brave new world that has such wonders in it.
Whose fault is it that students are getting useless degrees? The students?
