This is dedicated to my client Mr. A in hopes that he will keep his dignity and not lose hope.
Some basic facts about Mr. A: He is 83 years old and a veteran of the Korean War. His sole source of income is Social Security. He has an unfortunate array of medical problems, both physical and mental.
He worked for years, mainly in the insurance business, and retired in his 70’s. He lives alone. He has three children, none of whom are doing very well financially.
Mr. A sought legal assistance because the government had started taking a large chunk of his Social Security income and he could no longer afford to buy the medications he needed. It took a while to unravel the source of the offset because Mr. A insisted that he had never taken out any student loans to pay for education. He was correct that he had never taken out loans to finance his own education because he was able to use the G.I. bill. Instead, the offset occurred because of parent PLUS loans from the early 1990’s. Mr. A insists that he never took those loans out either. It’s unclear whether he did take out the loans or whether one of his sons took advantage of him. Regardless, there is a large balance outstanding and Mr. A cannot pay. His children cannot help him financially either.
We contacted Sallie Mae to figure out a way to at least reduce the Social Security offset. We submitted detailed proof of Mr. A’s income and expenses. It took hours to document these expenses. Mr. A almost missed one appointment because he slipped in the rain and was disoriented and couldn’t find the legal service office. He has been unsteady ever since he broke his leg late last year.
We provided the information and Sallie Mae eventually agreed to reduce the offset to an amount that allowed Mr. A to purchase most of the medications he needs to keep going. This is not a permanent solution as Mr. A will have to fill out the expenses and income information every year, but it is enough to keep him going for now.
One would think that the government would be satisfied with the offset of Mr. A’s Social Security for this parent loan from the 1990’s. This is not the case. They also keep placing the account with collection agencies. I asked the Sallie Mae representatives to take the file back from the collection agency. Among other problems, the constant phone calls and letters are very upsetting to Mr. A. The Sallie Mae representative said they can’t take the file back. They did agree to put my name on the account as the contact. I called the collection agency a number of times and confirmed that I was Mr. A’s attorney. For some reason, it took months for the agency to record this and in the meantime, the collection agency called at least 4 or 5 other attorneys in my office.
In my last conversation with the collection agency supervisor, I asked again if they could stop their collection efforts. Mr. A has no money other than his Social Security and they are already taking a large portion of that. He is not going to inherit anything because his parents died many years ago and his only remaining sibling recently passed away and left him the car he uses to get around. Unbelievably, the agency said that they are required by law to keep contacting him. They agreed they would call me instead, but that I should expect weekly calls. I repeated that this is a waste of time. The representative suggested that perhaps Mr. A could take advantage of one of their “special programs.” She then described to me a “special” option to get out of default by paying $10 monthly for 4 months. I told her this is ridiculous because my client could get out of default if he wanted by consolidating without making any payments at all. She had never heard of this! I had to read her the regulations.
In any case, Mr. A doesn’t want to consolidate or rehabilitate because he doesn’t believe he owes the money. He also doesn’t want his balance to balloon even further due to collection fees that the agency automatically adds to accounts even if they didn’t do enough to earn them. Further, Mr. A doesn’t want to apply for disability discharge because he believes he can still work.
Where is the taxpayer outcry about the funds being spent to pay collection agencies to hound people like Mr. A? Or in this case, to hound me? Do taxpayers want to pay so that I can get a weekly call from a collection agency and tell them that my 83 year old client has not yet won the lottery? (He doesn’t buy lottery tickets by the way).
This is just one story of how draconian student loan collection policies are harming some of the most vulnerable members of our society. The agencies clearly have the authority to stop doing this. There is no law that says that they must call a borrower (or his attorney) every week. Checking off a contact box on a computer screen has become more important than common sense. This is where our policies have taken us. Is this what we really want to pay for?