Loans Designed to Fail: States Say Navient Preyed on Students
Source: New York Times
Ashley Hardin dreamed of being a professional photographer glamorous shoots, perhaps some exotic travel. So in 2006, she enrolled in the Brooks Institute of Photography and borrowed more than $150,000 to pay for what the school described as a pathway into an industry clamoring for its graduates.
Brooks was advertised as the most prestigious photography school on the West Coast, Ms. Hardin said. I wanted to learn from the best of the best.
Ms. Hardin did not realize that she had taken out high-risk private loans in pursuit of a low-paying career. But her lender, SLM Corporation, better known as Sallie Mae, knew all of that, government lawyers say and made the loans anyway.
In recent months, the student loan giant Navient, which was spun off from Sallie Mae in 2014 and retained nearly all of the companys loan portfolio, has come under fire for aggressive and sloppy loan collection practices, which led to a set of government lawsuits filed in January. But those accusations have overshadowed broader claims, detailed in two state lawsuits filed by the attorneys general in Illinois and Washington, that Sallie Mae engaged in predatory lending, extending billions of dollars in private loans to students like Ms. Hardin that never should have been made in the first place.
Read more: https://www.nytimes.com/2017/04/09/business/dealbook/states-say-navient-preyed-on-students.html?_r=0
Scamming the vulnerable is SOP for the Republicans,
but the Democrats own part of this too with their support
for bankruptcy "reform" and toleration of predatory student lending.
Obama's Sec. of Education, Arne Duncan, did very little to clean
this up.
niyad
(113,587 posts)made you fall for the bs of needing 150k to learn to be a photographer?
as the article pointed out, these scams are no different than the housing scam. and nothing will be done about these thieves either.
bucolic_frolic
(43,322 posts)this type of mega loan has been ongoing in the for profit colleges, and really any kind of instruction
you can name.
To trade equities there are trader schools ... you can read a pile of books, take a $500 course, or a
$3000 one .... or take one for $8, $10, $25k by the time you're done with all the extras
Bernardo de La Paz
(49,045 posts)FairWinds
(1,717 posts)they are typically among the first in their families to go to college
and they just don't realize that a lender or school would lie to them
so outrageously.
And it's amazing that the mostly for-profit scam schools, and
the lenders can seek bankruptcy protection, but the students
who were cheated cannot (not yet anyway) . .
thanks to the 2005 bankruptcy "reform" (NOT!) bill for which
a number of Democratic US Senators voted.
sharedvalues
(6,916 posts)Ludicrous the schools can file for bankruptcy but the borrowers cannot.
mopinko
(70,247 posts)lisa madigan is great!
Angry Dragon
(36,693 posts)sharedvalues
(6,916 posts)But we should be closing down the private-equity run fourth tier scam law schools too.
the_sly_pig
(741 posts)I could bore with details, but I won't.
kimbutgar
(21,211 posts)School. She was grifted and was naive.
When something sounds too good to be true it's probably a scam. I got taken for a timeshare years ago. Never again will i be that gullible. But they wore us down that day, it was $13,000 I learned a hard lesson that day.
FairWinds
(1,717 posts)among others, which is why we regulate capitalism and have
institutions such as the Consumer Finance Protection Bureau -
or used to.