Ms. Karrow said the growth of New Jersey’s program was simply a result of both the increasing number of students and the rising cost of tuition. But in fact, college enrollment and tuition have not grown as rapidly as the program’s size.
Student loans are crippling to everyone, apparently even the relatives of those deceased. Something that is meant to help people is debilitating them, and appointed officials say they cannot do anything about it? I do not believe that. The system is clearly failing.
Called “state-sanctioned loan-sharking” by a bankruptcy lawyer, the program’s aggressive collections and stringent rules can easily mean financial ruin for borrowers.
A spokesman for Gov. Chris Christie said the governor did not control the authority and declined to respond to questions about the loan program. But Mr. Christie, a Republican, appointed its executive director, Gabrielle Charette; he also has the power to appoint at least 12 of the agency’s 18 board members and can veto any action taken by the board.
Other states have loans like New Jersey, but New Jersey is worse. Why?
…the state depends on Wall Street investors to finance student loans through tax-exempt bonds and needs to satisfy those investors by keeping losses to a minimum.
So in order to please the 1%, among other reasons for its stringent rules, it forces people in dire situations to pay what they at times cannot, and ethically should not be required to pay.
New Jersey, meanwhile, encourages students to buy life insurance in case they die to help co-signers repay.
REALLY?! I doubt that paying off your kid’s student loan is the first thing (or even the tenth thing) on your mind after he/she dies.
The agency, Ms. Karrow said, treats each instance of a deceased borrower case by case and tries to be compassionate, but, she added, “we must also meet our fiduciary duty to our bondholders.”
At the expense of dead person’s family? At the expense of someone literally fighting for his/her life? The bondholder can get his/her money at a later date, or be humane about the loss of a life. Money is not everything.
A New Jersey rule adopted in 1998 allows the authority to give borrowers in default a second chance by allowing them to become current on their account through on-time payments. But the agency has never granted a reprieve and instead cuts off contact with borrowers, leaving them at the mercy of collection firms.
Honestly, everything about this makes me think, as any rational human being would, CORRUPTION. What is this agency really doing with the money, and why hasn’t the federal government done something since 2010? Obviously, New Jersey’s student loan system is ripping people off. It has become a loan shark hiding behind the legal system.
3 words: Student Loan Reform!
Source: In New Jersey Student Loan Program, Even Death May Not Bring a Reprieve – The New York Times