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Universities Hold Transcripts Hostage Over Loans

Soulskill posted about 2 years ago | from the might-execute-a-few-to-show-they're-serious dept.

Education 541

Hugh Pickens writes "Dave Lindorff writes in the LA Times that growing numbers of students are discovering their old school is actively blocking them from getting a job or going on to a higher degree by refusing to issue an official transcript. The schools won't send the transcripts to potential employers or graduate admissions office if students are in default on student loans, or in many cases, even if they just fall one or two months behind. It's no accident that they're doing this. It turns out the federal government 'encourages' them to use this draconian tactic, saying that the policy 'has resulted in numerous loan repayments.' It is a strange position for colleges to take, writes Lindorff, since the schools themselves are not owed any money — student loan funds come from private banks or the federal government, and in the case of so-called Stafford loans, schools are not on the hook in any way. They are simply acting as collection agencies, and in fact may get paid for their efforts at collection. 'It's worse than indentured servitude,' says NYU Professor Andrew Ross, who helped organize the Occupy Student Debt movement last fall. 'With indentured servitude, you had to pay in order to work, but then at least you got to work. When universities withhold these transcripts, students who have been indentured by loans are being denied even the ability to work or to finish their education so they can repay their indenture.'"

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541 comments

And the bubble continues... (4, Insightful)

Anonymous Coward | about 2 years ago | (#39920763)

And the bubble continues to press against the thumbtack.

I have a feeling this collapse is going to be bigger than anything we've seen yet. Dot Coms or Real Estate be damned.

Re:And the bubble continues... (5, Insightful)

Anonymous Coward | about 2 years ago | (#39920827)

The state of US education seems to be:
-Expensive
-Ineffectual
and now
-Counter-productive

A triumvirate of failure.

The problem is the people, not the education. (0, Interesting)

Anonymous Coward | about 2 years ago | (#39921025)

The American education system itself isn't that bad. It's not the best, but it's not the worst, either. The main problem is the people.

A large portion of Americans are religious to the point where they refuse to acknowledge reality. Even when it's readily available and of a high quality, these people will shun any education that may remotely challenge their religious beliefs in one way or another. They steer clear away from any sort of science, and many of them even distrust mathematics. This distrust and outright hatred of science and math doesn't leave them very many useful fields to study.

There's another large portion of Americans who aspire to be nothing more than "gangstas". Even when involving a curriculum developed by non-whites and taught by non-whites, these people still insist on rejecting "the white man's education".

Finally, there is the whole "hipster" phenomenon. These are adults who are mentally still children, usually due to growing up in a household where everything was provided to them. They also reject a useful education, either in favor of mooching off of their wealthy parents, or by studying a field that offers absolutely no job prospects and no real-world value.

It was one thing when there was a small portion of Americans who would embrace ignorance. There have always been people like that, and nothing can be done for them. But these days, we're talking about 60% or more of Americans who willfully and voluntarily reject a useful education. That's a recipe for disaster.

Re:The problem is the people, not the education. (5, Insightful)

Bill, Shooter of Bul (629286) | about 2 years ago | (#39921239)

Wow 60% huh? I'm guessing because you're shunning ignorance and embracing science, that you simply hit enter before actually providing us with the source for a number. I mean, what kind of a idiot would base such a bold statement on his mere feelings.

Re:The problem is the people, not the education. (0)

Anonymous Coward | about 2 years ago | (#39921321)

The lady doth protest too much, methinks.

does it surprise you? (1, Insightful)

ganjadude (952775) | about 2 years ago | (#39920773)

This is the kind of thing that happens when you allow the government to get in the middle. I am just glad that I didnt make the mistake of getting into the mess of student loans. There really is no excuse for what is going on here

Re:does it surprise you? (5, Interesting)

Anonymous Coward | about 2 years ago | (#39920861)

That didn't work for me. The college district sent me an extortion note years later claiming that I owed them money. Thing is that I don't owe them any money and it's an impossibility that I owe money for that term as they won't let you register for classes if you haven't paid and I took classes the next quarter. They still haven't unlocked the account. I'll probably have to file suit against the college if I want my transcripts unlocked as sending them a letter demanding evidence that I owe money didn't work and student loans aren't subject to any statute of limitations on collections.

I'm still not sure why they felt the need to send out fraudulent bills other than the budget conditions now, but unfortunately, filing a lawsuit against the state is likely the only way in which I'll get it permanently cleared up.

Re:does it surprise you? (0, Troll)

Anonymous Coward | about 2 years ago | (#39920887)

This is the kind of thing that happens when you allow the government to get in the middle.

And what kind of thing would that be? Businesses demanding payment for services rendered? Or gubmint demanding payment of money owed? Try not paying your taxes Mr Teat Partier, and see what happens.

Re:does it surprise you? (3, Insightful)

ganjadude (952775) | about 2 years ago | (#39920973)

The point is the college is owed no money, it has been paid, it therefore has no reason whatsoever to hold up the release of transcripts. If the school was giving you the loans, it would be a different story and they could do as they please, but when the facts are

you got a 3rd party loan

you paid the college for your classes

the college has no vested interest in holding your transcripts.

Re:does it surprise you? (1)

GodInHell (258915) | about 2 years ago | (#39921179)

Odd ... my loans may be managed by Salley Mae, but they're issued by the savings and loan affiliated with my school. I have no doubt they'd be out to fuck me good if I defaulted.

God bless you if you graduated into permanent or semi-permanent unemployment.

Re:does it surprise you? (2)

ganjadude (952775) | about 2 years ago | (#39921203)

by that logic if I am using the same bank that you are using, I should be able to put a lein on your house if you owe the bank I affiliate with any money.

Re:does it surprise you? (2)

Obfuscant (592200) | about 2 years ago | (#39921385)

by that logic if I am using the same bank that you are using, I should be able to put a lein on your house if you owe the bank I affiliate with any money.

No, by the logic being used, the BANK should be able to "put a lein on" (and has, the day he signed the mortgage) the house if he owes them any money. And they should be able to (and will) reposess (foreclose) if he stops paying them back what he owes.

In this case, the government has put a lein on the product that you purchased using the money you borrowed from them, and are foreclosing only because you aren't paying them back like you promised you would. The fact is the limitation on getting a transcript only occurs if the debtor is BEHIND in payments, not just because the loan exists.

Re:does it surprise you? (1)

Attila Dimedici (1036002) | about 2 years ago | (#39921317)

Who do you make your payments out to? If you make the payments to Sallie Mae, Sallie Mae bought the debt from the savings and loan that made the original loan. In that case, the savings and loan does not get any more money when you make payments on your student loan.

Re:does it surprise you? (3, Insightful)

CubicleZombie (2590497) | about 2 years ago | (#39921191)

But the third party has every right to go to the school and make this kind of arrangement. "Help us collect or we won't do business with your students."

Might even result in lower interest rates for students, since the risk to the lender is lower.

Re:does it surprise you? (2)

ganjadude (952775) | about 2 years ago | (#39921329)

interesting argument, and I am all for allowing the 3rd party the right to do as it pleases, however the point remains, party A gives me a loan, I pay party B in full for (insert item / service here) party A should not be able to bypass me and go to party B for any reason, party A has no relationship with party B in practice. If a friend lends me money to buy a car, he cant go too the dealership and demand they hold the title until I pay him back

Re:does it surprise you? (2)

Obfuscant (592200) | about 2 years ago | (#39921277)

Is this different than getting a loan to buy a car? You get a third party loan, you pay the car dealer, you drive off the lot. You have the car. In this case, you got a third party loan, you used it to get a degree.

You aren't prevented from getting those transcripts to provide to a potential employer unless you are behind in payments. Kinda like a repo man coming for the car you aren't making payments on. What happened to the concept that if you borrow money from someone to buy something and then don't pay them back, you don't get to keep what it is you bought with their money?

The summary is, of course, deliberately inflammatory, in that not getting your transcripts does not prevent you from working, only from using those transcripts to get a specific job. There is no involuntary servitude involved. You can still get a job and pay your loans, and when you do, you get your transcripts. That the school is involved is natural, since they are providing the thing that you have used someone else's money to buy.

Re:does it surprise you? (4, Insightful)

vux984 (928602) | about 2 years ago | (#39921181)

And what kind of thing would that be? Businesses demanding payment for services rendered? Or gubmint demanding payment of money owed? Try not paying your taxes Mr Teat Partier, and see what happens.

What this needs is a car analogy:

You need insurance for your car, so you buy some from ABC, and put in on your Visa credit card. So far so good.

Then some idiot rear ends your car... so you call your insurance company, and they tell you your claim can't be processed because you missed a payment on your credit card, and they won't honor your insurance until you repay Visa.

See why this is both weird and wrong? Your insurance is paid up, and paid in full. Its none of ABC's business whether or not your account with visa is in good standing. That's between you and Visa.

That's the problem that is happening here. The government (taking Visas place) loaned the student money to purchase an education. The student then used that money to purchase an education from the school (taking the insurance companies place). So the transaction between you and the school is complete, and the school was paid in full for your education.

Its no more more the school's business to collect payment on your student loan than it is the insurance companies business to do collections for Visa.

Re:does it surprise you? (5, Insightful)

imamac (1083405) | about 2 years ago | (#39921187)

Government needs to get out of the business of supplying endless money to students. This is the exact reason why college tuition has skyrocketed in recent years. Universities don't have to care about keeping expenses low, they just need to feed all the students through the government loan line effectively. If loans had to be secured only through private means or at LEAST the gov loans were very low, universities would have to lower prices to keep getting new students.

Re:does it surprise you? (0)

Anonymous Coward | about 2 years ago | (#39921031)

Yeah. It's not like the private industry would try to force you to repay loans by any means possible either. It's not like there's some kind of record of all your borrowing and repayment history which, if fouled, will destroy your ability to take out loans, or possibly even obtain employment. Nope. Good thing unbridled capitalism's unseen hand always shapes everything exactly the right way, even if there are externalities in the situation. Hallelujah! Praise be the Unseen Hand!

This is not the government's fault (1, Informative)

betterunixthanunix (980855) | about 2 years ago | (#39921071)

This is the sort of thing that happens when universities become the tools of the corporate system. The fact that the government has also become a tool of corporations is tangentially related, but the truth is that universities are doing plenty for corporations without any government prodding:
  1. Financial aid? Outsource to corporations.
  2. Food? Outsource to corporations.
  3. Student housing? Outsource to corporations.
  4. Homework assignments? Corporations.
  5. Bookstores? Corporations.
  6. Curricula? Whatever the corporations are demanding.

Once a school opens the door for corporations, there is basically no turning back -- corporations begin to influence every aspect of the university.

Re:This is not the government's fault (2, Interesting)

ganjadude (952775) | about 2 years ago | (#39921175)

The issues with your argument is that you canw alk back one step further and see that all these things are requirements by the government
student aid? many government loans there so your not really correct there
food, government requires schools to provide food to XX standards, you need XX permits to operate at a school, blame the regulation there

houseing, what? most student housing around any campus I have been around minus the dorms (which are owned by the schools 90% of the time) are private owned by and rented out, you dont like it, you buy one of the houses by a college and rent it yourself.

homework assignments....ok now I know you are just making shit up. Please explain to me what having to do homework has to do with corporations? MOST homework at a school (a good one) is set up by your professor and his/her helpers, not "a corporation"

bookstores... well, yeah what else did you expect? corps are best suited to be in business of selling goods, you dont like it buy a bunch of books and talk a school into letting you open shop
you really need to think things a few steps further down the road.

Re:This is not the government's fault (4, Interesting)

shiftless (410350) | about 2 years ago | (#39921347)

Dude... ^^ THIS. Seriously....the University I attended (Michigan "Technological" University) recently outsourced their email, groupware, etc to Google.....I'm like, what the fuck?? You teach computer programming and IT, and presume to be a top tier engineering school, but can't even maintain your own basic IT systems? Do you not see how you are outsourcing your core competency and denying your students the ability to get real world hands on experience fixing this stuff?

That's the argument I made on Facebook anyhow, and several drones (you know the type....19 year olds who think repeating establishment propaganda is the same thing as making a logical argument) immediately attacked me saying I didn't know what I was talking about. OK then, fine kids...stick your fingers in your ears and whistle. Actions have consequences. Enjoy your $100k in student debt when you're unemployed, and too stupid and inexperienced to get a job....asshat.

Re:does it surprise you? (4, Insightful)

JosephTX (2521572) | about 2 years ago | (#39921311)

If the government REALLY "got in the middle", this wouldn't be a problem in the first place since public colleges and universities would be dirt cheap or even free, as they are in most other OECD countries.

In fact if you look at tuition, aside from Australia, the US government is less-involved in college education than any other developed country in the world.

Re:does it surprise you? (5, Insightful)

Beardo the Bearded (321478) | about 2 years ago | (#39921373)

As a Canadian, where the government is heavily involved in both providing student loans and subsidizing education, I have to say that you're totally wrong.

I graduated in 2004 with an Electrical Engineering degree. The total I had in student loans was $0. (zero) Co-op paid for most of my expenses. Courses were about $400, six per term, a total of $2400 per semester. (I know, holy shit, right?) Books were the typical ass-rape, but in the non-lubed Canadian version. (A couple of books were $120, lots at $80, I eventually just gave 'em all away.) I was not living with my parents, and rent was about $500 a month.

It's dirty socialism, right? Nope, it's long-term thinking. I pay more in taxes now than I did before I got my degree since I'm earning 2.5x what I got when I started school. I'll be paying 2.5x more taxes (more actually, since we have progressive taxes up here) for the rest of my career.

FAIR IS FAIR !! (-1)

Anonymous Coward | about 2 years ago | (#39920775)

In love, war, and college !!

Good move (0, Troll)

Anonymous Coward | about 2 years ago | (#39920777)

Perhaps people will actually start paying what they owe instead of getting a new iphone or whateve

Re:Good move (2, Informative)

Anonymous Coward | about 2 years ago | (#39920859)

And if word gets out, maybe we can deter the incoming freshman from this self-destructive strategy.
Taking out student loans for an undergraduate degree is just stupid and lazy.
It leads to the lifelong debt cycle Americans are increasingly trapped in.

Re:Good move (0)

Anonymous Coward | about 2 years ago | (#39921189)

So how exactly are they going to pay their loans if they're denied the ability to work to..pay off the loan?

Yay for short-sighted stupidity (0)

Anonymous Coward | about 2 years ago | (#39920799)

Or, in other words, the government hating on its own and supposedly most valued citizens, "on behalf of" large financial companies. Hmm.

Happened to me trying to get hired at Apple (5, Interesting)

Anonymous Coward | about 2 years ago | (#39920807)

I was incredibly fortunate to be able to call my department head and speak with him, he personally corresponded with the background check agency and it was finally accepted that I wasn't lying, however, they said that I couldn't list the degree on my resume. This was in 2005 by the way.

Atrilce doesn't mention... (1)

tomhath (637240) | about 2 years ago | (#39920813)

...what happens if a student contacts the lender and informs them of the problem. I know people who have done this, lenders understand and generally work with you if you explain the situation. Not so much if you just stop making payments.

Re:Atrilce doesn't mention... (1)

gatfirls (1315141) | about 2 years ago | (#39920899)

Because that's not the point of the article, it's about schools saying "fuck you pay *them*" when they should have no interest in doing so. Not to mention when a company is perfectly within their rights to bleed money from you in anyway possible it really doesn't matter how "willing" they are to work with you because should you find yourself in hard times they will stop at nothing to get money out of you....to include denying you the education documentation that should be rightfully yours. I don't recall education loans using the education as security. If that changes expect threat of lobotomies for delinquent students in the near future.

Re:Atrilce doesn't mention... (5, Insightful)

tomhath (637240) | about 2 years ago | (#39921147)

they should have no interest in doing so

They have a very big interest in student loans; without affordable loans the number of students would drop dramatically. Students who don't pay back their loans are costing everyone who does make their payments extra in the form of higher interest rates. Instead of getting a big attitude, try working with the system instead of against it.

Re:Atrilce doesn't mention... (2)

gatfirls (1315141) | about 2 years ago | (#39921335)

Holy moly, are you completely clueless on how broken "the system" is? That post was right out of some PR department. Get this: Students are never affecting the system like that because school debt is next to never written off. They just make more off of a delinquent debtor so more profits. It's cute people still walk around thinking they can work "with the system" and everything will turn out a-ok. Maybe you'll never be on the receiving end of hard times but if you ever are you will find out quickly the system is and has been against *you*.

Re:Atrilce doesn't mention... (1)

Attila Dimedici (1036002) | about 2 years ago | (#39921365)

Well, you are correct that they have a big interest in student loans. However, it is not the one you listed. Their interest in keeping the student loans coming is so that they can continue to spend money in ever increasing amounts without having to worry about their rising costs costing them customers.

Re:Atrilce doesn't mention... (0)

Anonymous Coward | about 2 years ago | (#39921233)

...what happens if a student contacts the lender and informs them of the problem. I know people who have done this, lenders understand and generally work with you if you explain the situation. Not so much if you just stop making payments.

Last year, my sister *wanted* to take her family to Disney. She called Direct Loans and literally asked them if she could have a forbearance to give herself more spending money at Disney World. No problem, Ma'am. Have a good trip.

Not really a problem (1)

Anonymous Coward | about 2 years ago | (#39920815)

Just don't be a deadbeat. Taking more money than your McDonalds job can pay is a dumb position to put yourself in.

Re:Not really a problem (2)

NoobixCube (1133473) | about 2 years ago | (#39920865)

When education, to escape the McDonalds job's pay, costs more than your average home loan, what other option is there?

Oh, right. Rich and influential parents who can make sizable "donations" to the educational institute.

Re:Not really a problem (2)

NaCh0 (6124) | about 2 years ago | (#39920963)

Your other option when you can't afford it is to take things step by step. Get your associates, take a step forward in your career. Get your bachelors, take a step forward in your career. Get your masters, etc. Sure you don't become a PhD by age 25 this way, but shockingly, life is not "fair."

Re:Not really a problem (1)

Bucky24 (1943328) | about 2 years ago | (#39921417)

There are some people who manage to rack up $70,000 in student loans just getting their Bachelors. Now, they probably made some pretty dumb choices to get to that point (or go to a school that is way out of their class) but someone in that situation (probably with an Arts degree too) is going to owe something like $1000 a month in student loans for the next 20 years (I'm estimating here based on what I pay for the loans I owe). That's not easy when you work at starbucks (the Art degree, remember?). And any serious career requires a Bachelors at this point, not to mention the social pressure kids have been experiencing their whole lives.

Note, I'm not insulting Art majors here. Replace "Art" with whatever you feel to be a useless degree if it offends you.

Re:Not really a problem (-1)

CanHasDIY (1672858) | about 2 years ago | (#39920891)

Hey, idiot - do the math:

1. Student racks up gov't loan debt going to school; plans to pay debt back by getting a good job with their degree;
2. Gov't loan shark prevents student from either finishing their education or getting a job to pay loan back with;
3. Student has no other option than to take minimum wage shit jobs that don't pay enough for them to live on, let alone pay back the loan, so they are forced to (say it with me):

Be on welfare.

Indentured servitude, my ass, this is a blatant attempt to enslave the populace, and I for one will tolerate no part of it.

Re:Not really a problem (0)

CanHasDIY (1672858) | about 2 years ago | (#39920907)

One error in my previous statement: A loan shark probably has more honor and compassion than the government.

Re:Not really a problem (0)

Anonymous Coward | about 2 years ago | (#39921287)

Hey idiot, you forgot the preferred alternative: Contact the bank and negotiate how much you can pay back until you get that good job. It works, really.

Re:Not really a problem (1)

Anonymous Coward | about 2 years ago | (#39920897)

Doesn't stop the schools from sending out fraudulent bills for debts that don't exist. What's worse the Seattle Community College District won't even show me evidence that I owe them money without my paying them first. It's completely fraudulent and completely illegal, but without filing suit against them they can call the "debt" at any time. What's worse they waited years to inform me that I allegedly owe them money even though the money is from a quarter I wasn't in school and I attended classes the next quarter after.

They won't let people enroll who haven't paid their bills from previous quarters.

Extortion? (4, Insightful)

ranton (36917) | about 2 years ago | (#39920819)

Considering almost no one pays for college without loans today, any college whose students could not get loans would be dead in the water. That gives a lot of leverage for banks to "ask" colleges to play along.

Then there is the unspoken truth that most of these degrees are worthless. If banks ever released official statistics on what degrees from which colleges resulted in the most defaults, it would hurt a lot of programs. (and immensely help out prospective students, but who cares about that?)

Re:Extortion? (1, Insightful)

cpu6502 (1960974) | about 2 years ago | (#39921029)

My parents paid cash for me (and then I paid them back once I had a job). ~$80,000 really isn't that much money if you learn to SACRIFICE and save you money instead of throwing it away on Comcast cable, Verizon cellservice, and other shit that you really (to be brutally honest) do not need.

And yes a lot of college degrees are worthless. They ask students, "Do you have a job?" and usually they do..... at Walmart. Or maybe a temporary job with the college itself. NOT an actual job in the degree studied.

Re:Extortion? (0)

Anonymous Coward | about 2 years ago | (#39921235)

$80,000??? Wtf??? What kind of non-extremely specialized job pays that kind of money to a recent college graduate?

Re:Extortion? (4, Insightful)

GodInHell (258915) | about 2 years ago | (#39921247)

My parents paid cash for me (and then I paid them back once I had a job). ~$80,000 really isn't that much money if you learn to SACRIFICE and save you money instead of throwing it away on Comcast cable, Verizon cellservice, and other shit that you really (to be brutally honest) do not need.

So, you're saying everyone should just have parents who SACRIFICED their whole life (and had a good job) so kiddo can get a degree interest free?

Interesting. I'm certain your experience is that of the everyman. No doubt.

Naturally, out society should be based on the premise that one's success in life should be based on how much effort your parents put into paying your way up the ladder.

Re:Extortion? (2)

Sparticus789 (2625955) | about 2 years ago | (#39921127)

Bullcrap. I know plenty of people who made it through college without a single student loan. There are grants, scholarships, GI Bill, etc. Instead of asking the government to give an education to them, these people actually work for it and earn it.

Re:Extortion? (0)

Anonymous Coward | about 2 years ago | (#39921263)

And there are plenty of folks who applied but received no such grants, scholarships, GI Bill, etc. Money has to come from somewhere, ended up working for it _AND_ taking out student loans while in college. 80hrs-100hrs a week in both undergraduate and graduate school between job and school and extracurricular activities. Enjoying working the 50-60hrs a week now.

Re:Extortion? (0)

GodInHell (258915) | about 2 years ago | (#39921269)

There are grants, scholarships, GI Bill, etc.

I know a few dozen who did take loans, did well, and then succeeded in life and became awesomely successful. But hey, fuck them right, they should know their place and stay in the mills if they can't find a handout ... er I mean grant ... to get them through college.

Re:Extortion? (0)

Anonymous Coward | about 2 years ago | (#39921279)

If you're getting through college on grants and scholarships alone, you're so smart, skilled and/or talented that you don't even need college.

Re:Extortion? (2)

praxis (19962) | about 2 years ago | (#39921341)

So you are saying the people that pay back the cost of their eduction did not work for it, but the ones that were given money they didn't have to repay worked for it. Both groups worked for it.

Catch 22 (5, Insightful)

Anonymous Coward | about 2 years ago | (#39920831)

You can't work until you start paying us back and you can't pay us back until you start work.
Seems a bizzare way of organising things. In the UK you can't pay back your student loans until you earn a certain minimum wage and then it starts to come out from your pay like a tax as a percentage of your wage. And like the summary says it is the government who hold the debt, not the individual Universities/colleges. If they really want to stop the problem of defaulting then surely it would make more sense to reduce the number of degress that didn't have much job prospects, rather then block the people with degrees from getting jobs.

Re:Catch 22 (0)

Anonymous Coward | about 2 years ago | (#39920895)

I never heard of an employer requesting college transcripts. None of mine ever did.
Is the problem perhaps that graduates have no previous work experience to list?
I guess that would fit, if they're borrowing to pay for school.

Great Way to Get Alumni to Donate (5, Insightful)

Githaron (2462596) | about 2 years ago | (#39920871)

This seems like a great way to get alumni to donate when they eventually do start making good money. The affected alumni are not going to harbor any resentment at all.

Re:Great Way to Get Alumni to Donate (4, Insightful)

Anonymous Coward | about 2 years ago | (#39921163)

My university's colors are green and gold. It helped make it clear that my relationship with the university was strictly a business transaction -- I gave them money and passed the classes, they gave me the degree. There is no further relationship, and they get no further money from me. Ever.

Fine for Perkins not fine for others... (1)

JJJJust (908929) | about 2 years ago | (#39920883)

Any school who withholds a transcript for an overdue Perkins loan is probably doing the right thing since they're indirectly suffering economic damage. Not so okay for other loans.

7% (0)

Anonymous Coward | about 2 years ago | (#39920889)

When I got my student load the GST on it waw 7% so now it is 5% and that means I save money on my student load. If it drops lower I WILL MAKE MONEY because I got a student loan. If that isn't justice, nothing is.

Remember kids. (0)

Anonymous Coward | about 2 years ago | (#39920909)

That degree for which you took out a loan big enough to pay for a decent house isn't worth quite as much as an equivalent area of toilet paper.

Does seem like an effective tactic to lower the number of people competing for jobs thereby making the unemployment numbers a bigger pile of feces.

Didn't the banks pay? (1)

Karmashock (2415832) | about 2 years ago | (#39920917)

The way student loans typically work is that the bank or government pays immediately and then collects over time.

For the schools to withhold the transcript implies that the schools themselves weren't paid which is not how this normally works.

So... did the schools get paid or not? Who secured the loan? I've seen no instance where the schools have ever backed a loan for a student's education outside of scholarships and that's because the school is basically waving fees.

Awesome (4, Funny)

ZombieBraintrust (1685608) | about 2 years ago | (#39920925)

Now I can convince employers I have a degree law from Harvard. I am just behind in my loans.

Re:Awesome (1)

ZombieBraintrust (1685608) | about 2 years ago | (#39920975)

Now I can convince employers I have a degree law from Harvard. I am just behind in my loans.

I suppose they could run a credit check to see who I owed money too. Ohh well, I guess I will have too settle for a degree in medicine from my actual school. Time to start defaulting on my loans.

Class Action Lawsuit (4, Insightful)

cpu6502 (1960974) | about 2 years ago | (#39920935)

If I was a lawyer I'd look at this as a Great opportunity to file a class-action lawsuit. As the summary states the colleges are not owed any money, therefore they hve Zero grounds to hold hostage the record of the students 4-5 years. They are committing a crime (charged money but did not provide the final document promised in the contract).

Go for it Mr. Lawyer.
Rape the bastard colleges.

Transwhat? (0)

Anonymous Coward | about 2 years ago | (#39920957)

actively blocking them from getting a job

Really?

Admittedly, I'm out of touch with the prospects for Women's Studies majors, but is a lack of transcripts really a problem? I mean, for people who actually did something during their college career - like network, volunteer at non-profits/work on open source projects (CS/IT), interned somewhere, et cetera.

Re:Transwhat? (0)

Anonymous Coward | about 2 years ago | (#39921149)

Or, you know, actually worked a job.
Where did the idea come from that students should just play during the 20-30 working hours a week that they're not in class?

Stupid? (1)

codewarren (927270) | about 2 years ago | (#39920959)

How wise is it to prevent those who owe you money from getting jobs to payback said money?

Re:Stupid? (0)

v1 (525388) | about 2 years ago | (#39921141)

How wise is it to prevent those who owe you money from getting jobs to payback said money?

How wise is it to not exercise the only collateral you have to get paid on what you are owed?

This is like someone complaining they can't sell their car because they don't have the title on it, because they refuse to pay off the loan. Imagine that, it's a great incentive to pay off the loan.

The borrower may claim that preventing them from selling the car is hampering their ability to get cash to help pay off the loan. Soooo, does that make it a wise idea for the bank to hand them the title in the hopes that someday the borrower actually pays off the loan? That's just all kinds of stupid. Collateral exists for a reason, and that's all the transcripts are - collateral on a debt.\

That doesn't mean the whole idea of digging yourself a decade into debt with college loans to get a degree to get a job is a good plan. But if you choose to go that route, to get a loan through the college instead of say, through your bank or relatives, you accept that they will hold the transcripts if you are in default. You know this going into the deal. I'm not having any pity for you if later you think it's not fair. It's the road you chose, and it's not the only road that was available to you. You thought it was fair when you took out the loans. Now take responsibility for your decisions and stop blaming others for taking advantage of your bad choices and bad fortune.

Re:Stupid? (1)

lightknight (213164) | about 2 years ago | (#39921241)

Ah, the re-emergence of the idea behind debtor prisons.

Someone, quick, lend me some magnets and copper wiring. I need to make visit to the graves of the Founding Fathers, as I imagine they should be up to about 7000 RPMs as of late.

Re:Stupid? (1)

Kurrel (1213064) | about 2 years ago | (#39921323)

How wise is it to not exercise the only collateral you have to get paid on what you are owed?

When you take out a student loan, are you pocketing the cash? No, you are immediately paying your tuition. The schools are owed nothing, they are extorting on behalf of the lender.

Blame on both sides (5, Insightful)

Missing.Matter (1845576) | about 2 years ago | (#39920997)

From the article, empthasis mine:

She concedes it's a difficult issue but says that "it's the only tool we have to make them pay."

A music major ... was making payments on his $62,000 student debt after graduation while working as an adjunct professor for Temple.

So we have institutions lending $62,000 to majors that have terrible job prospects, then when they can't get jobs they don't know how to get the money back... okay. How about don't lend that much money to someone who you can be pretty sure won't pay the money back? I know higher education should be accessible to all and this and that, but perhaps 62 grand for a degree in music should give us pause to reconsider a) why does a degree in music cost 62 grand and b) why does someone want to spend 62 grand for a degree in music.

I can partiall answer b). I was at a advisory board meeting for my university's CSE department recently, and some undergrads were asked the question: "So what is tuition now?" No one could answer. They don't even KNOW that they are paying $40k+ a year in tuition. This is because they don't even look at their bill. They fill out the fafsa, press a button, sign some papers, and get free money that gives another year of partying. The reality only hits them AFTER they graduate and look back at their full bill. This attitude on the student's side has got to stop

There's also the attitude on the institution side, that they can loan someone $60k for a degree in basket weaving and reasonably expect to get it back. This has to stop as well, but I don't know how to fix it.

Re:Blame on both sides (1, Informative)

Anonymous Coward | about 2 years ago | (#39921081)

He has a job, a pretty good job, as an adjunct professor.

Re:Blame on both sides (0)

Anonymous Coward | about 2 years ago | (#39921193)

Adjunct professing doesn't pay that well. In many cases, it's basically a no-benefit part-time job.

Re:Blame on both sides (3, Informative)

doktor-hladnjak (650513) | about 2 years ago | (#39921281)

Adjunct faculty are basically the academic equivalents of temps (no benefits, low pay, term-by-term contract) or are only working part-time while making their living from another job (e.g., professional musician teaching on the side). Generally, not "a pretty good job".

Re:Blame on both sides (0)

Anonymous Coward | about 2 years ago | (#39921325)

Not really, if you look into it most are screwed; especially online stuff. no incentive to put in the time for the low pay. remember it is part time and likely limited severely by the union to X courses per year. (I'm glad my union does its job or there would be no full time people only part time people getting shafted at low rates.) I made more money as a college student than as a adjunct college professor; actually, I made as much as the typical college "professor" (lowest ranked title is not called "professor") they make 35k a year with benefits in my state. I could have skipped college completely and kept with my student job; if I get hired full time after completing 2 degrees I'm starting at where I was before; then I have to jump more hurdles and get more degrees etc to increase pay. High school teachers may start out worse but they quickly surpass us (but their job is now miserable thanks to the politics of today.)

Re:Blame on both sides (4, Insightful)

SilverJets (131916) | about 2 years ago | (#39921171)

This has to stop as well, but I don't know how to fix it.

Simple. Well maybe not simple but the solution is to have companies stop requiring a bachelor's degree as a minimum requirement for every single job out there. This has watered down what university used to be. No longer is it a place of higher learning, higher thinking, and higher reasoning. Instead it has become a mill churning out tomorrow's workforce.

Re:Blame on both sides (0)

Anonymous Coward | about 2 years ago | (#39921229)

There's also the attitude on the institution side, that they can loan someone $60k for a degree in basket weaving and reasonably expect to get it back. This has to stop as well, but I don't know how to fix it.

Start by restructuring most universities' athletic departments. Most rely on funds from the university to get by. Rutgers University students are paying an extra $1,000 each year to fund football. University of Colorado-Boulder actually had to postpone firing their football coach a few years ago because the athletic department was still repaying the loan it took out to fire the previous football coach.

You can't realistically shut all these athletic departments down, but you ought to be able to put a halt to sending a guy on his way with an extra $3 million in his account.

Re:Blame on both sides (1)

tomhath (637240) | about 2 years ago | (#39921243)

How about don't lend that much money to someone who you can be pretty sure won't pay the money back?

I support that statement 100%. But the problem is with the federal government; banks have to make those loans because politicians don't have the spine to tell a student "No". Same as the housing bubble; banks didn't want to make loans to low-income people with bad credit, but they were required to have a certain percentage of those mortgages on their books by the Community Reinvestment Act thanks to Jimmy and Slick Willy.

Re:Blame on both sides (3, Insightful)

billius (1188143) | about 2 years ago | (#39921255)

It's things like this that make me hate the entire crooked system. The federal gov't wants more people to go to college, so they tell the financial institutions "Hey, lend these people all the money you want, we'll make sure they pay it back even if they declare bankruptcy." Meanwhile, the state gov't, elected on a platform of lowering taxes while providing all the same services (the essential contradiction of basically all elected governments), decides to slash education spending. The universities scramble to cut costs but immediate stop when they figure out that the banks are perfectly happy to lend $100,000 to 18 year-olds with no credit history and instead jack up their tuition. At the end of this wretched cycle, you've completely transferred all of the burden to people who took out loans because they couldn't pay for college in the first place and all the kids with rich parents can't seem to figure out what all the fuss is about. Even the kids who get scholarships are screwed because they generally don't scale to handle increasing tuition rates. My freshman year of college, my scholarship paid for an entire year's worth of tuition. By the end of my senior year, it covered less than one semester.

worth keeping one around (1)

Trepidity (597) | about 2 years ago | (#39921019)

Not necessarily for this reason, but it's as good as any opportunity to point out that you should really have a local copy of your transcript, preferably scanned into PDF along with your diploma as well. For many things, especially outside academia (e.g. applying to jobs in corporations), a PDF of your transcript is perfectly sufficient, and it's quite convenient to have one handy, even if you aren't behind on your student loans, because the official registrar transcript is often not very timely in arriving. Only a minority of things really require an original stamped/embossed copy of the transcript, versus a copy or even a PDF.

Loans - you're supposed to pay them back (0)

mveloso (325617) | about 2 years ago | (#39921051)

I'm not sure what part of the word 'loan' people don't understand.

Give me that money, and I'll pay it back. There you go. If you don't pay, you don't get what you bought with your loan.

If you stop paying your car loan, what happens? Repo. If you stop paying your college loans, what? Well, they can't take your education away...but they can take verification away.

That seems perfectly straightforward.

To be honest, after a while nobody asks for your transcript anyway. Nobody really cares about that crap, unless you're going to graduate school. I've interviewed lots of people, and never asked for one. Who cares how you did in school?

Re:Loans - you're supposed to pay them back (1)

shiftless (410350) | about 2 years ago | (#39921159)

I'm not sure what part of the word 'loan' people don't understand.

I'm not sure what part of the word unemployment you don't understand.

Stop apologizing for your corporate masters; it's disgusting.

Re:Loans - you're supposed to pay them back (0)

The Other White Meat (59114) | about 2 years ago | (#39921201)

There's this thing called: "The Economy". Apparently, "The Economy" is where people go to find work. Apparently, the number of jobs currently available is less than the number of people that need to work. Apparently, if you can't get work, you don't have money to pay back your student loans. ... and apparently some people are too stupid to understand that. One wonders how those people have jobs in the first place.

(Sadly, the tag line I created when I first created my Slashdot account is just as relevant today...)

Everyone's role is clearly defined already. (5, Insightful)

Pirate_Pettit (1531797) | about 2 years ago | (#39921073)

Who is muddying these waters?

The schools have been paid, have they not? That's the whole point of a loan - lender pays now, and you pay the lender.

And, as others have said, it's a little short-sighted to stand in the way of those in debt, since the best way for them to pay off those loans is to be successful. Again, that's the whole point.

Any institution engaging in this sort of behavior is way out of line. In fact, it's rather rare to see such a clear-cut case of wrongdoing when it comes to financial/political entanglements.

Back off, universities. You are not moral guardians, gatekeepers, or creditors. You are educational institutions, and your obligation is to the students, not to whatever twisted group of people suggested you monitor you alumni for credit score violations.
A declining credit score is already one hell of a millstone - like weight gain, it's much easier to damage your score than improve it. The last thing we need is universities undercutting those students who need their credentials the most - those who essentially gambled a portion of future success on the hopes of a beneficial education. Do they want us to pay our loans off or not?

You spent it (-1)

Anonymous Coward | about 2 years ago | (#39921077)

Sorry, you signed for the money, you spent the money and are unhappy someone is holding you accountable to pay it back.

I took a well paying degree and paid back the 45K I owed when done. Still made more while repaying it than I would have if I had not went back to school. Much more after it was paid off.

If people stop paying, banks and government will stop lending. School will then suffer. It is in the schools interest to get involved.

Work 5 jobs if you have to and repay your debt. Be accountable for your actions.

Re:You spent it (1)

spire3661 (1038968) | about 2 years ago | (#39921207)

You are the kind of fool who looks at the rigged game and says 'well why cant you play better?'

Re:You spent it (0)

Anonymous Coward | about 2 years ago | (#39921305)

A strange game. The only winning move is not to play.
If you don't borrow in the first place, you won't be whining about "the rigged game".

Maybe things have changed (1)

Necron69 (35644) | about 2 years ago | (#39921085)

But is an employer asking for your transcript really that common? It has never happened to me in the 20 years since I graduated. After my first job, nobody cared other than that I had a degree in my field, and not one employer since then has checked just to see if I was lying about it.

Now grad school, sure they'll want your transcript, but if you can't pay your undergrad loans, is borrowing a ton more money and going to grad school really a good idea?

Necron69

I am Zachary Dovel (1)

icongorilla (2452494) | about 2 years ago | (#39921091)

I lost my leg to cancer when I was 12. Because of the pain from walking, I was forced to stop going to school before I could graduate. I tried to make it on my own working at target. But the loans people kept calling until:

  • They upped my hours so I lost my medicaid
  • My leg broke from the added stress
  • Forced me to stand on it for so long and bike to work that I was breaking from the mental stress of the pain again like I was at school.
  • I crushed my hand in my leg so now I have nerve damage in my hand because I was forced to bike to work when I shouldn't have been.

I know the only thing I have to look forward to life is this continuing pain and having the student loans people call me telling me I'm useless. I can't even do minimium wage work.

I've been mailing all of the local papers and handing out the paperwork. When I do hang myself, they can't say they didn't know why. They can't say they didn't expect it. As a cripple with no other choices in this world, this is the last thing that I can give back to humanity.

There is no hiding. I am Zachary Dovel, and I hope to be remembered for the good and not the bad. I just need to hang myself before they force me homeless again. Like almost everyone else in this world, the student loans companies want all of the money without any of the responsibility.

Re:I am Zachary Dovel (1)

icongorilla (2452494) | about 2 years ago | (#39921327)

If anyone is in Seattle, they can take pictures after the event and perhaps mail it out.

Maybe cheer me on. Being in pain isn't worth it. I can't go out. I can't have fun. I don't use a phone because I get threats from them. I can't afford a new prostetic when this one breaks. It is all dead end.

I feel like i am 60 when I am 28. I don't want this anymore. I've tried so hard for so long.

Not to make light of a bad situation but... (1)

Torinaga-Sama (189890) | about 2 years ago | (#39921195)

'It's worse than indentured servitude,' said NYU Professor Andrew Ross who completed his post doctorate work in Hyperbole at the University of Bologna.

Seriously, show me the debtors prisons..

Re:Not to make light of a bad situation but... (2, Insightful)

Anonymous Coward | about 2 years ago | (#39921395)

Seriously, show me the debtors prisons [wsj.com]..

Defaulting is Hard (5, Informative)

Anonymous Coward | about 2 years ago | (#39921199)

They will give you an enormous amount of patience and latitude. All you have to do is call and tell them that you can't pay them. They will ask you a few questions, then take your word in regards to your income, employment status, and expenses without asking for so much a a shred of proof, and most likely grant you a deferment of forbearance.

When I couldn't find a job about 5 years ago, at first I got by on deferment for about 6 months, after which a had to bite the bullet and take a job way beneath my education level. When I called to tell them that I was now able to pay about 50% of my payment every month, they offered to keep the deferment in place so my partial payments would go entirely to principal. Yes, that's correct - they had even stopped the interest for the entire deferment period. They stopped time itself to help me. Once I had gotten on my feet I started full repayment. When I lost that job before I'd had a chance to save and build an unemployment hedge, they did it for me again.

They withhold transcripts in cases where students have dodged them, avoided them, and failed to acknowledge the debt.

Law Violation (0)

Anonymous Coward | about 2 years ago | (#39921213)

Since New York State is a right-to-work state, this may be a clear violation of the law.

When the Germans bombed Pearl Harbor (1)

istartedi (132515) | about 2 years ago | (#39921253)

Bluto: Hey! What's all this laying around stuff? Why are you all still laying around here for?
Stork: What the hell are we supposed to do, ya moron? We're all expelled. There's nothing to fight for anymore.
D-Day: [to Bluto] Let it go. War's over, man. Wormer dropped the big one.
Bluto: What? Over? Did you say "over"? Nothing is over until we decide it is! Was it over when the Germans bombed Pearl Harbor? Hell no!
Otter: [to Boon] Germans?
Boon: Forget it, he's rolling.
Bluto: And it ain't over now. 'Cause when the goin' gets tough...
[thinks hard of something to say]
Bluto: The tough get goin'! Who's with me? Let's go!
[Bluto runs out, alone; then returns]
Bluto: What the fuck happened to the Delta I used to know? Where's the spirit? Where's the guts, huh? This could be the greatest night of our lives, but you're gonna let it be the worst. "Ooh, we're afraid to go with you Bluto, we might get in trouble." Well just kiss my ass from now on! Not me! I'm not gonna take this. Wormer, he's a dead man! Marmalard, dead! Niedermeyer...
Otter: Dead! Bluto's right. Psychotic... but absolutely right. We gotta take these bastards. Now we could do it with conventional weapons, but that could take years and cost millions of lives. No, I think we have to go all out. I think that this situation absolutely requires a really futile and stupid gesture be done on somebody's part!
Bluto: We're just the guys to do it.
D-Day: [stands up] Yeah, I agree. Let's go get 'em.
Boon: Let's do it.
Bluto: [shouting] "Let's do it"!
[all of the Deltas stand up and run out with Bluto]

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