Student Loan Sinkhole?

It appears that your computer does not have the Flash Player required to view NOW videos. Visit Adobe to download and install the latest version of the Flash Player.

Commenter: Stephanie
This video is so scary... I've already taken out 3500 dollars just to go to a community college. I have a one year old son and could fully identify with the woman. For me, loans were the only way to avoid a dead end waitressing job and provide for my son without giving him up. I'm currently planning on majoring in journalism and wonder if I'll ever be able to provide for us independantly. Debt slavery is real, and its miserable thinking that the government is preying on our best and brightest's dreams of creating a future for ourselves....

Commenter: Alex
I have worked in Higher Education for 15 years. Worked in all areas of Student Services. In a class I taught call Academic and Life Skills I spent at least 5 hours talking about money and finances. I have seen too many students take on mountains of student loan debt by attending elite private colleges and get a degree in a traditionally low paying fieled such as teaching. Its really sad that the student wasn't warned.. or at times they were warned but didn't care. While educational loans are justified as they are an investment in one's future, let teh buyer beware!

Commenter: Josh
Matt-Do you remember your freshman year when the prof said 'look around you because those students will not graduate'. Thus, quite possibly a large number of those carrying student debt do not have a degree.

Commenter: Kathryn V.
My student loans have ballooned like crazy (I went from 60k to 100k over the past 4 years), mainly because I can't find any well-paying positions in my field. I've been working as a graphic designer, but $10 an hour doesn't help much, especially now that my hours have been cut back drastically.
Right now my parents are covering my loans because there is no way I can pay them.
The real shame is that my Nellie Mae loans are nearly impossible to consolidate at a lower interest rate. I would be happy if I could find someone to buy them and lock them in at 4% - rather than the 9 and 10% (and this can go up and up). Also, shouldn't we be worried that the two kinds of unforgivable debts are student loans and child support? Because obviously those of us with student loan debt are on par with negligent parents.

Commenter: Rachael
In my six years of repayment (minus a six month debt-burden forbearance I took in order to participate in an intensive continuing education program which cut my pay 50%), my $86,000 of student loans have been paid down to $81,000. I pay on time each month a total of $630.50. Do the math. ($630.50 x 12 months)x5.5 years = $41,613. WOW! What a gift I've been given! I've paid $5000 in pricipal and $36,600 in INTEREST! Someone is getting their pockets lined by my education...it's not me!

Student loans are a racket aimed at keeping the poor poor. They keep educated working professionals out of the middle class, from having children, owning homes, starting businesses, saving money for their futures, or from changing careers.

I would have been better off NOT pursuing my career in healthcare and continuing to work remedial jobs for mediocre pay.

Commenter: Andrew Pecota
Story Idea! There's currently a Supreme Court case in the works regarding the restructuring of student loan debt in Chapter 13.

I think it's ironic that the "swing vote" on the court, Anthony Kennedy, is an adjunct faculty member at a mediocre law school=McGeorge Law school in Sacramento, CA. As noted by the last poster, law schools are some of the worst offenders in terms of tuition inflation.

I thought there were conflict of interest rules that would prevent sitting justices from participating in cases in which they had a financial interest. Isn't getting paid by a school that gets its funding directly from student lending companies create a conflict of interest when a justice rules on a case involving the student lenders?

Commenter: Matt
the report says that about 25% of the country has student loan debt. I find that a bit hard to believe considering only about 26% of the country has a college degree.

Commenter: Tired
I work in financial aid. I work very hard to warn parents and students of the realities of student loans. I provide the arsenal of knowledge I possess, and even with all that information, some people still make unwise choices.

College costs too much. True. Lenders aren't always forthcoming regarding the terms and conditions of their loans. True. Borrowers don't always understand (or care) about what they are getting themselves into with loans, and don't always make the best choices regarding their educations. True. These three things have created the "perfect storm."

All three have to be tackled, and all at the same time if we want to see some real change.

Commenter: Sheri D. Wahlen, MD
I am a 48 yr old woman who trained as a family physician in the 1980s, and now am disabled due to a genetic disorder that makes all my bodily structures fragile and heal slowly and poorly. My multiple orthopedic problems which haven't healed properly have taken their toll and I am no longer able to keep up the pace family physicians need to maintain to make a living. My difficulty now is that I make too much money from Social Security to have my student loans forgiven and the interest just keeps piling up. One of the companies that held my consolidation loan ran up the interest by keeping me on perpetual forebearance, so, while I borrowed less than $100K and even paid the whole mess down to less than $25K when my health failed, I now owe well over $100K. Of course, it affects my credit, as did the impoverishment I was required to prove to qualify for straight Social Security/Disability.

I think it's atrocious that I sacrificed my health and well-being for patients by practicing in a specialty that emphasizes providing health care for people WITHOUT demanding a high salary, and here I sit, unable to work, in pain much of the time because I keep acquiring new orthopedic injuries, and there is no way to get out of this horrid, stressful financial hole. And how the loan servicers talk to a sincerely disabled person who not only worked long hard hours to take care of other fellow citizens--many downtrodden themselves--but would continue to work that hard if I COULD. Don't even get me started about the YEARS I spent not being able to land a steady, full-time job with benefits because employers didn't want to pay insurers exorbitant rates for health insurance for me and about how fellow physicians deliberately mismanaged my health care . . .

Commenter: RK
Instead of complaining, we should ask what can help Gina(and other like her)now? Gina does have some options, at least for her Federal loans. She should consolidate all of her Federal loans through the Dept of Education. This will get her loans out of default. She should apply for the new Income Based Repayment Plan. Some will not have to pay anything. http://www.nasfaa.org/publications/2009/anibr061209.html
Once she finds a public service job, she should apply for the Public Service Loan forgiveness program which will forgive the balance of her loans after 10 years of repayment.

Commenter: D-Rod
Why didn't she ('Gina') call her alma mater's financial aid office for guidance? Didn't she complete the required entrance and exit cousneling session while in school? I do feel sorry for her.

Commenter: joe drader
What is the dollar amount owed by students in the usa
for the number of students?

Commenter: Freedem
Many things are terrifying here but perhaps the most terrifying are the Empathy voids in people who cannot imagine any problems in the world beyond their own.

I have had good luck and bad and made brilliant decisions that were mostly brilliant in hindsight as were the really bad decisions.

To those few of you who have life working pretty well, don't sit too high on that horse of self satisfaction, Murphy waits for your most vulnerable moment, and then you can only hope there are folk about with a lot more humanity than you have

Commenter: Ashley
I dont have a kid, I have a good job...but these loans are too much. Who can afford this with entry level positions out of college? Maybe once I have 5 years experience, but not now.

This is so discouraging, we thought we were doing the right and responsible thing. The way this is we cant enojoythe things we have done right...graduate, become a professional, added to society,...

Commenter: Corbett Alger
Great report. I'm wondering with so many students in default of loans, are there any positive figures reflecting people benefiting from student loans? (excluding doctors, lawyers, and the sort)...

Commenter: grad student
I am currently a graduate student/sucker at a school in a small town in northern California. My first year here, I got work study and Perkins Loans (lowest interest of all loans), but then for my second year I found out that I got no work study and only $2000 in Perkins Loans! That means that I can't work on campus and that I have to take out more unsubsidized student loans. It's a very small town and there are very few, if any jobs available.

I know university financial aid departments tell students to not take out so many loans, but how do they expect students to pay for their extremely high tuition. It's kind of like the tobacco companies being forced to put warnings on cigarettes. I also question the ethics of giving work study and the good loans to students to entice them to agree to attend the school and then in the second year, cut the aid and force them to take out loans that are unsubsidized. Most of my classmates have been denied work study this coming semester.

Commenter: JP
This show gave a honest look into the world of student loans. Personally, I am going to have over $120,000 of student loans to pay back once I finish college in 2011.

I try to only borrow for my direct expenses from the university and so far I have stuck to that principle. I utilize summer jobs to accrue enough of a savings in order to have spending money for the whole school year. My main concern right now is to find a job that will allow me to pay back the debt within 10 years, and I still have 2 years until graduation. I feel like these loans have caused me to think too much about the long term. I want to be able to travel, and enjoy life once I graduate, but will these loans keep me grounded from going abroad?

Commenter: Tom212
Anyone looking at this story may want to consider one of the sources:

http://www.lvrj.com/news/25845924.html

Commenter: yikes!
i can't believe the number of the so called college educated participants on this blog and not one of you are pointing the finger at the schools. did you ever think to ask why tuition is so much? tuition rates have sky-rocketed past inflation rates and no one in the political arena will question the obvious issue here and that is high tuition rates. instead you want to blame the lenders who provided the loans. if you cannot understand the terms of a student loan, please stay away from mortgage loans. the interest rate on a student loan is more than a car loan. go figure.

Commenter: Bill Delano
Thank you for producing this piece... My heart goes out to Gina and Alice. I hope and pray that we as a a country can come together to help those who have been blind sided by the banking industry.

Keep up the good work NOW. Talking heads and 30 second new's clips will never be capable of transmitting Gina's story with such fullness . Now is the time when we most need you guys. Thank you for the concern and care with which you continue show for your subjects and audience. -Bill

Commenter: Sara
Excellent program, but it needs to be far more grounded in the History of these programs.

A History would at least begin with LBJ's programs from the mid-60's, that mated up the Pell Grant program with Work/study subsidies to Colleges and Universities that at the time covered something like 80-90% of costs of State Colleges and Universities. Loans or small scholarships from HE institutions could cover the rest.

During the early Nixon Administration, policy changed, and Pell Grants were not increased to cover inflation, and funding for W/S was dramaticly cut back, opening the way for loans to play a much greater role in College Finance -- as the spread increased between costs and available grants, the Financial Industry walked into the opening with the Guaranteed Loans (not to the borrower, but to the lender in case of default). From the Nixon period -- early 70's to the present, Higher Ed has had huge inflation of costs, which in turn generated the market for larger and larger loans. It was also a period when HE institutions were encouraged by lenders to enter into preferred relationships -- leading to what Elliot Spitzer found when he brought cases in NY, essentially kick-backs to College Presidents and Chief Financial Officers and heads of Financial Aid offices. Yep -- my own investigations of this found such goodies as College officers getting leased Lexus cars, and invites to "conferences" in lovely 5 Star Hotels in Bermuda or Hawaii in mid winter to "discuss" financial aid. These preferred relationships also defanged the HE lobby in DC, it refused to lobby against the interests of the Financial Industry in all this.

Shortly after he was elected to the US Senate in 1990, Senator Paul Wellstone held hearings around the country on the issue of these loans. The 1994 legislation that started rebuilding the Direct Student Loan program was the outome -- but in the end he pulled his name off the legislation when it was corrupted by additional protections for the private lenders.

Any real understanding of the problem also requires looking at the contributions of the Student Loan Finance Industry to Senators and members of Congress. There are two types to examine closely -- the direct contributions, limited to about 10,000 and the contributions to Leadership PACS, controlled by committee and party leaders, that have been used to defeat incumbants and candidates that got too close to the corruption at the heart of this, and of course to re-elect those close to the interests of the Student Loan Financial Industry. Eliminating the possibility that a former student who falls on tough financial times could discharge debt through bankruptcy was just one "favor" done for the Student Loan Financial Industry.

What Obama is doing -- increasing the value of the Pell grants -- eliminating some of the subsidies and the risk protection afforded the private Student Loan Industry is a good start -- but it does not begin to really address the problem. The real problem is overdependence on borrowing as the fundamental means of financing Higher Education. Perhaps it will take a crash of the 700 Billion toxic loan assets Banks have on their books to get the policy makers and educators on the same page, and invent a model that does not put graduates into interest slavery.

Commenter: Robert Zelikson
I think it is terrible that students graduate from school with in many cases with debt loads the equivalent of a mortgage. I do think a part of the story is missing however; tuition costs have continued for many years to outpace wage inflation. In other words, over time tuition has become a higher percentage of an average parent's or student's salary. Increasingly larger loans are now required to fill that gap. The question is, what is the school's responsibility for this increase in the debt that students must now carry?

The other related issue is that schools offer little to no advice to the student on how much debt is prudent to carry. It would seem that part of the education that a school provides should include an explanation of the relationship between the amount of student loans incurred and the ability of the student to obtain a job with enough income to repay the debt.

Commenter: Liz
I really enjoy your show, and I think that you do a good job reporting the facts, but you are really off-base on this episode. I went to a private college, I have Stafford FFELP loans, Perkins loans, and more Stafford FFELP and private loans from grad school. But at no time in the last few years have I chosen to ignore my loans because I did not want to deal with them.

When I graduated with my BA and took a year off before heading to grad school. In that time both my Stafford and Perkins loans came due. I made my small payments, and worked three jobs to save money. After grad school, I began a career that would not pay well for a few years, so, I called my lender (that tiny phone number on the bottom of the numerous letters they send telling you that repayment is beginning soon) and spoke to them about consolidation. Mind you I was only 24, and still had the wherewithal to know that I could make my situation better.

My lender explained that I could consolidate my federal loans, but my private loan would be a separate payment, with a separate interest rate. Ok, note to self, you will have three payments a month...Moving on. So, I consolidated my federal loans that now were more than $50,000 and prepared to find a way to make my payments more manageable.

I went to my lender's website and began to read about the payment options that they offered. One that looked appealing was interest only payments for 2 to 4 years. I figured that this would be a wonderful option for me, because it gave me 2 to 4 years to establish myself in my career, and begin to make the money that would allow me to make my principal and interest payments.

I am a planner, so I also asked what I would owe if I did not take part in this program. Note to self, write down these numbers and plan for the future...Move on. I filled out the application and it was done. Both my federal consolidated loans for over $50,000 and my private loan for $30,000 were in interest only repayment for four years. With my salary of $30,000 a year, I was able to easily make my $135 and $170 monthly payments. The second fluctuated over the years due to a variable interest rate.

I did not drive a brand new car, and I didn't go on lavish vacations, but I was able to pay the rent, car insurance, car payments, and my cell phone bill. Why am I so different from any of the people in this piece? I'M NOT!!!

Did you know that it takes 12 months to be considered defaulted on a student loan. Twelve months, one year, 365 days of ignoring that big pink elephant in the room that is the money you willingly borrowed for an education you had every choice in the world to say yes or no to. Education should not be an option, it should be afforded to every person who seeks it, but you cannot then disown the choices you have made and blame other people. The assault on the student loan industry is despicable. It is high time that we as American's stop living lives of excess, and take responsibility for our choices and our actions. An for the record, I don't work for a lender, guarantor or loan servicer.

Commenter: James Hayes
A large part of the problem is school decesion process and cost benefit. Students far too often make poor decesions on where they want to go to school for the major career they choose. If you are a English major and choose a expensive private school, you made a terrible choice. You end up deep in debt for the career major you choose. If you want a liberal arts degree and career path you MUST choose a public education pathway. The cost benefit does not justify a private education unless you got into Havard. Forget what school has a better program, in the real world it is what you learn there that matters. We have set the focus on students but the whole education process and education selection process is to blame.

Jim Hayes
Financial Aid Professional for over 20 years.

Commenter: Brigitte McDonald
Oh dear, where to start? This student's story was disturbing, especially because a young, innocent child is involved, but, obviously, it is not at all surprising this single mom is in so much trouble. In fact, it was to be expected. One bad choice after another is a sure way to guarantee failure. The student loan system is very flawed and should be fixed, but personal responsibility is the foundation of success. I wish her the best and hope she can get her life back on track.

Commenter: SallieMae Victim
Two things your investigation missed - one is an omen of things to come.

1. Sallie Mae is not "defaulting" loans. They are keeping them on the books past the guidelines. They are also reporting past due loans strangely at the credit bureau. Maybe bad loans are stacked up and they are trying to fudge the reporting numbers. This would hide the trouble they got themselves into by paying schools points and eliminating disclosure requirements for pushing their private loans.

2. When I got my loans at University of Miami Donna Shalala had just become president. She was in charge of the Department of Education under Health and Welfare. While she was secretary, it seems, the disclosure requirements (as to the nature of the loan), were loosened and the policy of paying points allowed. After Clinton leaves WH she pops right into a private university presidency. (!)If this is true(!)she sold allot of people down the river to get that job.

Commenter: Holly Wallace
I went back to college to pursue a law degree in 1999. I had already paid off my undergrad degree in biology. I worked for six years doing water quality research between degrees. In law school, I was told I had to focus on school at the expense of a regular job and that whatever loans I took out would be easily repaid b/c of my increased earning power. Total BS. Despite being a fairly knowledgeable person, I had no idea that alternative loans could not be consolidated until I graduated and consolidated my subsidized loans. I also didn't realize I would be stuck with the variable interest rate. "Luckily" I put a great deal of my living expenses on credit cards. When I finally started drowning in credit card payments, educational debt and daily living expenses (mortgage, utilities, gas, etc.), I was able to discharge 65k in bankruptcy. Like the person you interviewed, I figured my credit was shot anyway. I still have about 100k in student loan debt. I make about 40k/year as a small town attorney (with pension and health ins. included, so worth about 50k). I pay $669/month in student loan debt, out of a total of about $2,500 available to pay all my expenses...between 25% and 30% of my income. In addition to my full time job, I work weekends, but lately only get about 24 hours per month or less. So I try to make an extra couple hundred per month to pay my utilities or whatever. I don't use credit anymore, except the $500 loan I have on my checking. When I did my bankruptcy in Jan. 2008, I told my colleague that student loan and credit card default was going to be the next thing to go awry in a big way. I know I am actually better off than a lot of people b/c I still have two jobs and own a home. I do wish that I could consolidate my private loans at a fixed rate though. They are killing me. I will be paying this debt (over $600/mo. till I am retired). How can anyone own anything substantial or put away for retirement when you have to pay so much for an education. I remember when I interviewed for my second job, I was speaking to a therapist at a residential treatment facility for kids and I said I always thought more education would mean more opportunities and financial security...but I was wrong. She understood exactly where I was coming from (most people I interviewed with for a second job thought my being a lawyer was a problem...at the treatment facility it was a plus). Just a note to say a certain degree doesn't mean more money...law schools aren't located everywhere, so it may be costly to move, take all the entrance exams and then licensing exams later. My first offer out of law school in 2002, from a small town, 2 atty firm in northern WI, was $28k, plus 1/3 of anything I brought in over 40k in revenue. So to make 38K in salary, I would have to bring in 70k in revenue. I was also offered a trailer to rent from one of the attorneys. I knew I could never make my loan payments. So anyway, not every lawyer gets filthy rich. Some of us just provide legal services at affordable rates for the communities we live in...and even then, not affordable for everyone. But that is another story...

Commenter: Shelley
Thank you for doing this segment! I have worked in College Funding for many years and parents need to know about this tuition bubble.

Interesting note: Colleges only report Stafford and Perkins loan debt as their studnet's average debt. This is very decieving as it is NOT the true debt as it leaves out the Federal PLUS loan and Private student loan debt. This is why we do NOT really know the TRUE average debt!

Commenter: frank
I have NO sympathy for stupidity ... I went to a State University and worked two jobs ... I also did not borrow more than I could repay under the worst circumstances ... I asked my parents for NOTHING and did not have a credit card or a new car until I could afford it.

This is NO different than the subprime mortgage debacle. It was caused by greedy stupid consumers, legislators and businesses. AND I AM PAYING FOR IT THRU GOVERNMENT BAILOUTS. THIS SUCKS !!!!!!

Commenter: Jim in Texas
My first attempt at college was not successful, living at home and working part time. I opted to enlist in the Air Force and was able to attend junior college part time while still on active duty. After my 4 year enlistment was complete, I attended a state university with my GI Bill benefits, and a part time job working on the college farm. Shared a 2 bdrm 1 bath apartment w/3 other guys, ate a lot of sandwiches, didn't take vacations, bought used books, etc. I graduated with $80 in my pocket - but no debt. Why don't some of the kids check into serving their country, and be rewarded with college assistance? State colleges and universities are not bad places - just cheaper! And study a field that will enable you to make a living wage. Life is all about choices. Make good ones.

Commenter: David from Illinois
This crisis made me reflect on the way we live. It is interesting how we as citizens and our own country have all fallen into this trap of borrowing money. We want everything and we want it now. In order to get it, we must borrow money. Why are we like this? I have met people from other places - particularly places that are not economically stable - and they are pretty averse to the idea of borrowing money. For them, you only get what you want after you work and save money for it. We all must face reality and change our ways.

Commenter: Janell
This is what I find terribly troubling.
I cannot get a loan for a car or a house without a co-signer due to my high income to debt ratio, even though my credit score is well above 700.
I cannot get food stamps or any other aid since I make income well above the poverty level, but the programs do not consider that if you add all my income and subtract my loan amount I make negative money.
I have life insurance that in case I die my parents are not suddenly in the hole $110,000 in private loans. I pay for disability insurance, which will pay my monthly loan payments in case I cannot.
I find it troubling that there are individuals out there who are so ignorant saying that it is the student's fault for taking out private loans. I was taught the value of an education in order to better myself, to have a better life than what my parents' had.
Thankfully I only had $15,000 in undergraduate debt due to scholarships, grants, work study and having 3 part time jobs in addition to being a full time student. I then decided to become a doctor. Thankfully I have a job and I am able to make the payments monthly on my loans, but my federal loans are under the ICR program and my privates are at the lowest level, which still totals around $1000/month.
I am a responsible individual. I have consolidated all of my loans under one lender for federal and with another lender for private. I keep track of my interest rate and signed up for automatic withdraw from my checking account in order to lower my interest rate 0.25%. It saddens me to know that there are others in my shoes and others who are struggling, yet our tax dollars are not aiding those who are really struggling. Yet our tax dollars are benefiting the CEOs of these companies receiving bailouts as well as individuals who abuse the welfare system.

Commenter: In Debt
After more than a year of applying to any and all jobs (including the White House -- desperation!), I finally secured a part-time temporary job last month (no, not at the WH) a few days before graduating (Master of Public Policy). Unemployment drove me to earn this degree. I had no choice but to take the full amount of the loan that was offered each semester because I needed it to pay my rent. I thought for sure this degree (and a very high GPA) would guarantee me a full-time permanent job somewhere, but still no luck. I earn just enough to pay my rent and a couple utility bills with the part-time temp job, which ends in a couple months. First school loan payment is due in December. Haven't lost hope yet, but I'm guessing the feds and the debt collectors will have a hard time tracking me down if I end up in a homeless shelter.

Commenter: Amy
If there is approximately $700 Billion in outstanding student loans, the government should act responsibly and take the Omnibus Spending bill and forgive ALL student loans... There is limited information for students in Univeristy Financial Aid Offices across the country. It is essentially a leech styled system where students are victims of the Univeristy. You are indoctrinated from a young age that an education is a must; however, school's have an opportunity to throw students into the lions den of financial institutions that operate under unethical situations.

By the way, I have almost $82,000 in student loans... I love my education but I hate the pricetag that accompanied that education especially when accompanied by the lies that other generations have offers and corrupt financial institutions.

Commenter: tiffanybianca
i have over 100k in student loan debt...and thats only undergrad. how am i supposed to support myself after paying $999/month or $600/month interest only? im unemployed, just got evicted from my apartment and now im paying rent to live at home with my mother. this is definitely not where i thought i would be! im confused, frustrated, lost, angry, and so many other things. why is it that colleges (the private ones) can charge students 25k per year for tuition and room and board? and increase tuition costs every semester? i guess its all my fault for picking that institution :(

Commenter: Kathryn from California
This economy has put a spot light on the repayment holds on student loans. -To gb that is the point she wishes to be a tax payer given the opportunities she strived for by completing her education-. I am an unemployed college graduate who will be facing student loans soon. Not to mention a private loan with a co-signer who must joint in my angst. I did it the right way! I raised my children, payed for a vocation school to be a unlicensed health care worker, then was employed in the field for 20 years doing most tasks of a nurse without the pay, responsibility, and/or prestige. I entered a Nursing community college, after 2 years of pre-requisites and entry into the nursing school lottery 4 times before getting into the program. The word was we will have be in a nursing shortage. With a mortgage payment I had to continue to work part-time, which 1/2 of my paycheck was paying for my medical insurance taken out each pay period. Nursing school consists of theory and direct patient care, these demands made it difficult to work within my scheduled hours (grave shift) in a Level I Trauma unit-County Hospital. I had to take out student loans and worst of all quite my job to cash in my retirement. My loans are $23,000. not to mention Credit Card debt that helped pay the bills. I graduated and jobs are scarce for New Graduate Nurses, programs have been cut from the hospital. I took a risk for the American dream. Those of you who question college in general better think twice and be glad for the caregivers who have sacrificed their finances, and families to become the Professionals that take your life in their hands to save you- Be grateful for their hard work in getting that degree and licenser.

Commenter: Paul
I went to engineering school in the 1960s and my wife went to a teachers' college. We both took multiple student loans to finance expensive educations at small private colleges. After college, I was an USAF officer for 20 years and worked in the aerospace industry after my AF retirement. My ex-wife worked for 30 years as a public school teacher. Both my ex-wife and I are now retired and have pensions and health care that will last until we die.

Our children were encouraged to be anything they wanted to be - within reason. As they grew up, each played multiple sports, learned to play musical instruments, and attended church regularly. When they went to college, two of three changed majors. The eldest changed her major from electrical engineering to mechanical engineering. The second changed his from petroleum engineering to aerospace engineering. My youngest is now in college as an astronautical engineer at the USAF Academy where her monthly stipend doesn't seem to last as long as the month. The first two children took multiple student loans, and we're now considering loans for my AFA cadet to tied her through the low spots.

In all five cases (2 parents and 3 children) we had a plan to pay back what we borrowed before we borrowed it. It's called a career. As sad as seeing the unemployed social worker trapped in debt-hell was, it only reinforced my belief that naive children are lied to by telling them that it they just go to college everything will take care of itself.

Social work, art history, liberal arts, communications, and all the other fake degrees offered by colleges to attract kids who can't make it in a real college program are similar to mortgage borrowers who borrow beyond their means. They buy a too-big house with no money down and no means to pay off the balloon payment when it comes due, only in this case the too-big house is a too-big dream.

If the social worker couldn't make it in a nursing, teaching, accounting, engineering, architecture, or even RTF (radio-TV-film) program, then she shouldn't have wasted her time and money on a meaningless bachelor and master degree. Now she is the master of unemployment and the only bright thing she took from college is her innocent daughter. Had she been counseled by a parent, relative, or high school teacher with some honesty and in reflection of her aptitude and ambition, she would have learned to type and answer phones and saved herself being raped and $70,000.

Why do we believe that everyone in America lives in Lake Wobegon, where all the children are above average. If you can't obtain an education that will pay for itself, then you'd better find and marry money (a Mr/Mrs Degree) while at college.

I hope every guidance counselor, parent, grandparent, aunt or uncle sits this year's high school graduates down and shows them this episode of NOW. The world already has far too many wannabe fairy princesses, ballerinas, and professional athletes laying in the credit gutter because they chose to go to college when they should have gone to work or wasted their college-level talent on a meaningless degree.

Keep telling it like it is, even though I think you missed the real point on this episode. Your portrait of the social worker was that she was a victim of mean and evil lenders. She is really the victim of an educational system that puts a large premium on keeping kids in school until they have the student's last dollar, and then some more. Colleges promise far more than they deliver. Even your victim said in the piece, "If I could give them back their degrees and make the debt go away, I would."

There's the kernel of truth; the pearl of wisdom.

Commenter: Jeff
I have 2 daughters in college, one mid way thru, 1 starting in the fall. We are very furtunate, the older daughter has only about $7k in loans so far ($21 K a year so far) the new hs graduate just got a free ride in a local community college

This hit so many nerves on where they could be after collge

Excellent report.. Out hearts go out to the mom featured in the story as well as the young man with 18% interest. It is all almost criminal

Commenter: Robert Baillie
I hope the law is changed to allow students like the one in this show to eliminate these debts through bankruptcy.

If that does happen, then, sadly, the only remedy I can think of is to move to another country where the debt collectors have no jurisdiction.

I don't know what the law is in, say, Canada. But it might be worthwhile for people like her to find out whether she would be safe there from U.S. debt collectors.

If this student got a job offer in Canada, became a landed immigrant, and move there, she might be safe. Plus, she would never again have to worry about medical expenses.

But unless the law is changed, she and many others will forever remain part of an indentured servant class.

Commenter: Pamela
As a single mother, I was deeply touched by Gina's story and contemplated what might have happened to me and my son had my job ended while I was the sole provider. Is there a way to help Gina cover some of her expenses?

Commenter: JT
I found the interview you did with the single mother in debt most insightful. As much as I feel sorry for her, she seems to have no sense of responsibility for her behavior and has a sense of entitlement to be bailed out for her decisions if they go badly. Nobody made her take out student loans or the type of loans she took out. Nobody made her select the major she did. And as tragic as her sexual abuse is, nobody made her keep her child instead of putting her up for adoption. The only real victim in this story is her child.

I am not trying to single her out; this attitude of irresponsibility and entitlement is pervasive in our society. Wall Street acts irresponsibly and gets bailed out. Car companies act irresponsibly and get bailed out. Homeowners act irresponsibly and get bailed out. Now students are looking to be bailed out from loans they took of their free will. This culture of irresponsibility will put this country into crisis after crisis as the country continues to decline. Personal accountability and acceptance of consequences for actions are the only solution to restore this country to greatness.

Commenter: Alice-Salt Lake City
Thank you for this weeks show-I too, am a single mom who was just thinking this morning that there are probably thousands of other single moms right here in my own city that just lost their jobs and cant afford to pay rent. I happen to have an extra room that I could rent out to someone in need, and was thinking about trying to find another single mom who could use the help. Right when I was thinking about it, I turned on the TV and your show was on. It is so sad to see that women with children are being advised to move out of their own homes just because their student loans are in default. My student loans are also in default, and I too understand her situation. Luckily I do receive enough child support to actually pay my rent in full each month. But I do realize that most/many women dont even receive ANY child support and have no where to turn when they loose their jobs. So, now after watching your show I have decided to use one of my rooms here in my house and try to find a single mom who could use the help in offering free housing to her so she can begin a new life and get back on her feet. Thank you so much for selecting this topic for your weekly show---and I encourage any other families who have spare rooms in their home to try and do the same!

Commenter: Mary, a parent
Excellent report and appreciate the accompanying information links as well. I hope you leave these up for a while.

I was shocked to find out a company could buy Sallie Mae old good name for $5MM - I did not know that...

I hope Congress acts quickly enough to make a difference in options to meet my son's assistance needs.

Commenter: Denise
Gina and her little girl brought tears to my eyes, especially when they find themselves homeless. The student loan industry should be ashamed of themselves for offering these loans without informing the student of the amount they will be responsible for after graduation. I don't feel that the student realizes the amount they borrow and what their payment will be once they graduate. They are so focused on the a piece of the American Dream and the only way to achieve this dream is through a college education. The other point I want to make is that I have been a social worker for 27 years and social workers are very important in many aspect of the work arena. Tell a hospice social worker that sits with a dying hospice patient and their family that they should have explored a more lucrative field or a police social worker that must enter a crisis situation to assist a family that has lost a loved one in a driveby shooting that what they do is not important and necessary. Most jobs in America are middle income jobs that pay in the range of 35,000-60,000 per year and social worker is one of those jobs. I can't believe that even on that salary a person could pay a loan company 1,000 a month and still pay rent, food and transportation.
As far as the loan companies, I feel, that they do not have the best interest of the student at hand, only filling their own pockets with stolen money. Great job on this program. Hopefully it will bring about some necessary changes in the student loan industry.

Commenter: Nathan
I was touched by Gina's story. She seems to a victim of circumstances, and it is outrageous that she is being exploited by the loan sharks. I hope she can get out of this quagmire soon.
We need governmental regulation to monitor lenders, improve information to the borrowers, and strengten borrowers' rights. With respect to student loans specifically, cut out the "middle-man" and let the government lend to students directly.

Commenter: Carol Twedt
It is virtually impossible to climb out of a lower economic environment without going deep in debt. In my own family, my daughter is in her 2nd year of law school with a growing debt load climbing into the 6 didget range. I am in college as well trying to raise myself to a higher level in my workplace which will not happen without a degree, so of course I too am in debt and climbing toward a 6 didget debt. If I for myself do nothing I will remain in a position that will not allow me to take care of myself as I go forward toward retirement. So the wheel turns, stay where I am no debt, go to college, get in debt to climb up the ladder to make enough money to survive and be able to pay off the loans that afforded me the opportunity to rise to another level in the workplace. In other words, I am buying myself a job!! Something wrong with this picture???

Commenter: Jeanne Sansbury Bell
I am not upset at the principal amounts owed on student loans, but the usurious interest rates which are compounded exponentially. Then on top of these insults on one's quest for higher education come the abusive harassment of the collectors who gain even more added fees and assessments. When will students be able have "simple" loans?

Commenter: Barry Buchanan
This bubble was created by an educational establishment that acted to saturate all skilled work with an oversupply of labor. Instead of being a market maker, education has been a market follower. The result is predictable: declining value in the educational certification marketplace.

Commenter: Barry Buchanan
The student loan crisis is not just some isolated economic event within an otherwise healthy economy. The failure of leverage against the economic crash is at all levels of the economy. Assets of all kinds are in process of being revalued. Stock portfolios, real estate, commodities, and educational certifications are valued by supply and demand. Generalized suppression of economic activity is directly related to monetary supply.

Since the education bubble has burst, the debt holders should swallow hard and do what is necessary: write down and revalue their uncollectable assets.

The federal government and the educational establishment also have roles to play. The educational establishment should not be held harmless in the coming financial adjustment. Their over-valued products need a price correction.

The federal government has 2 roles. First, leadership. Infrastructure and other public works should move to the top of the priority list for the stimulous effects. Equally important, though, is that these project provide the outline for what our society values.

Second, the federal guarantees should be uniformly applied against discounted student loans of all classes. Neither Sally nor BOA should make a killing or take too much of a bath on the socially desirable business of making education available to our populace.

Commenter: Ogbios
That show was awful to watch. The program was done well; but very disheartening. I never had any student debt leaving college. But did live with people who borrowed money. So have seen the system in action. The main problem with the current system is that students are being psychologically manipulated into believing they're suppose to achieve higher education. The simple reality is that most jobs require no higher education than high school.

Many employers are now requesting degree's and diplomas where no required education should be necessary. This is pushing further bias into the social mentality that a higher education is required. The main thing higher education is doing for the US, is making indentured servants. While further breaking apart the atomic family structure.

Someday I may end up moving to Venezuela. I'd prefer to remain a Canadian. But if things remain the way they are. I'll just have to go their to develop weapons.

Commenter: Rusty
"Your show is shamelessly one sided." Really. Only a person, who has support for virtual unlimited income or is from a rich family would make this remark. My own father attended Syracuse University from 1940 - 1943. He had 3 scholarships and paid the rest by working. No help from family and it cost him about $2500. I wonder what it would cost now?

State universities are beginning to prefer out of state students, because they pay higher tuition, forgetting that in stater pay the cost of all these institutions.

I have a very technical background, but cringe at the fine print on loans and all the more knowing how
these firms have lobbied Congress for programs that favor them. Sallie Mae is one prime example. While Tom Delay was majority whip he was lobbied against direct loans from the government that Clinton had put in place. I'm no Clinton fan, either.

A former Senator from my state, Spencer Abraham pushed legislation that allowed more H-1B visas for foreign workers in IT. How many American students signed on the dotted line not knowing this?

Commenter: Anonymous
I see the Sallie Mae PR people have found the comments section of this posting.

Commenter: David in Central Oklahoma
Student Loans can help the less fortunate like myself attend college. Without student loans and government grants I would never have attained a college degree. I worked long and hard to pay the student loans back. Sallie Mae sent letter after letter trying to get me to "extend" the term of the loan. I paid as much as I could and paid the loans off in less than 10 years. However, I was very fortunate to have secured a good job as a computer programmer that allowed me to pay the loans off early. No new car for me, I drove my old car until it literally quit and then only purchased a used one. Unfortunately, in our capitalist society, we must always remember, "let the buyer beware" and "there is not such thing as a free lunch". Everything comes at a cost. So students, read and be informed of what you are getting into when applying for a student load....Read the fine print and best wishes on you educational dreams.

Commenter: Jay
Thank you to everyone who watched this episode and PBS for also investigating this issue.

THIS IS NOT A SMALL ISSUE. Please everyone, go to STUDENTLOANJUSTICE.ORG and read the thousands of horror stories about students going through the same mess. Please get involved. There is lack of student protection.

I sympathize with Gina, because I'm going through the same things (as well as many more students) with these student loans. We are just two of thousands. There is no doubt in my mind, if the lenders would have worked with her in lowering payments and lowering her interest rates, then she would not be in this awful situation. One thousand dollars is an extreme amount for a student loan payment. She didn't do a thing wrong by getting an education...and she shouldn't be punished for it. We want to pay back what we owe, but not three times, four times, five times what we borrowed.

Please watch these interviews about this crisis and get involved. This is our future and our children's future.

http://www.youtube.com/watch?v=1463LHDLGvQ

http://www.youtube.com/watch?v=WZOtw5ciIUo

http://www.youtube.com/watch?v=pEFvT48_kaY

http://www.youtube.com/watch?v=wN1wdgtcpx8

http://www.youtube.com/watch?v=oOZd3L4G9MY

Commenter: Donna Miller
I know that she is just one person, but I was so saddened by the story of the young woman whose struggle you profiled. When I went to college, in the late 70s and early 80s, loans were reasonable. I was able to go to college and pay back my loans in under ten years, without being a lawyer or banker.

If there is any way I could send her some money through PBS--while of course, preserving her anonymity, please let me know. I don't have much money but I couldn't stand the unfairness of the difficulties she and her daughter were facing. Please let me know if I can send her some money through PBS. Thank you.

Commenter: Just Sad =((
I can relate to those who are struggling with Student Loan Debt - I'm one of 'em.

I thought that going to College or a University would change my life for the better, or better yet get me started in a career. Boy, that's what I get for being enticed with Ads; they lure you into deception - that's the American way, use deception, and when you're stuck in the puddle well, you're stuck. It's sad actually.

I have been through 10 - 20 - 30 interviews while in College and haven't lucked out in any. Be it for Data Processing or Computer Programming (and I can forget looking for something in the Interior Design department and got a Bachelor's). I have 4 degrees: 3 Associates and one Bachelor's, and still the job market is lousy when it comes to applying the field or skill that I was in.

I'm now a caregiver to my mother who have been in a car accident and helping her get around is hard; even for me with no means of income. Getting by is tough. I don't want to even think of how much I owe Sallie Mae/the others -- I believe I'm right down to $100K with no leeway in sight. I just received an offset from the Federal Government - US Dept. of Education and they get to garnish me of half of what I get, then on top of that, they took my stimulus to cover the offset... Is this a great country or what? I tried to write to Barack Obama about what happened -- no response as of yet. I don't know what to believe or what to do now.

The only option I have in dealing with Sallie Mae is through Forebearance. I'm poor and in the poverty stage, I cannot cough up 1,000 and "deny" paying my rent do do without dealing with these greedy loan-sharks (yes that's what I call 'em). It's hard it's really hard, and with the economy going the way it is, I don't see no solutions at all. Just fork up so many 1,000 of dollars of your hard-earned money and still be stuck, and be homeless for it? -- I don't think so.

The Government or Congress need to go back and re-write the Bankruptcy Law the way it was, it was re-done by the Republican Party to only make it harder for people who are struggling and no way out. If it ain't broke, why fix it!

I'll end by saying this: If our Government can give Bail-Outs to greedy Companies like SM and the others even down to Wall Street and let them off the hook -- even award them with Bankruptcy (can you imagine), then how come the citizens in this country get a BAIL-OUT? Nobody's perfect and we all make mistakes, but shall we be punished, and get no kind of leniency. If this is what they call democracy, then that's just plain sad - pure and simple.

To the students who want to get to College, a word of advice: Don't get suckered in to all the Ads about getting an education to better your life. It's a money trap that you cannot get yourself out of - if there is a glimmer of hope somewhere... My prayers go out to all of you who are struggling -- we need a miracle out of all this.

A Sad Poster.

Commenter: richard murphy
it is criminal what these lending institutions and corporations are allowed to do to these students, making them indetured slavesfor a long period of their life.

where are our legislators? are they here for the public (students) or the corporations?

the hibernian

Commenter: tw
Thank you for giving this issue the attention it so desperately needs. While watching this episode, all I could think was that you were telling my story. I too, came from a single parent home, grew up on welfare, and wanted a chance at a better life. I graduated three years ago, worked diligently to secure a job that would allow me to pay my monthly student loan balance, and was laid off in December 2008. I have not been able to find employment since. I have sent out 300 targeted resumes and not even Home Depot will hire me. My parents refused to help me pay for school, and now they will not help me pay my bills. I am in serious danger of losing my car and my apartment. Because of the choices I made as a teenager, with the help of my school's financial aid department (who recommended Sallie Mae), I will never own a home. I will probably die before the loans are paid off.

Thank you PBS and Robert Applebaum for making me feel sane. It's so nice to hear others say what I have been trying to tell people for three years. Sallie Mae lies, harasses, and steals with every chance they get.

Commenter: Justice
I found the interview you did with the single mother in debt most insightful. As much as I feel sorry for her, she seems to have no sense of responsibility for her behavior and has a sense of entitlement to be bailed out for her decisions if they go badly. Nobody made her take out student loans or the type of loans she took out. Nobody made her select the major she did. And as tragic as her sexual abuse is, nobody made her keep her child instead of putting her up for adoption. The only real victim in this story is her child.

I am not trying to single her out; this attitude of irresponsibility and entitlement is pervasive in our society. Wall Street acts irresponsibly and gets bailed out. Car companies act irresponsibly and get bailed out. Homeowners act irresponsibly and get bailed out. Now students are looking to be bailed out from loans they took of their free will. This culture of irresponsibility will put this country into crisis after crisis as the country continues to decline. Personal accountability and acceptance of consequences for actions are the only solution to restore this country to greatness.

Commenter: tw
Thank you for giving this issue the attention it so desperately needs. While watching this episode, all I could think was that you were telling my story. I too, came from a single parent home, grew up on welfare, and wanted a chance at a better life. I graduated three years ago, worked diligently to secure a job that would allow me to pay my monthly student loan balance, and was laid off in December 2008. I have not been able to find employment since. I have sent out 300 targeted resumes and not even Home Depot will hire me. My parents refused to help me pay for school, and now they will not help me pay my bills. I am in serious danger of losing my car and my apartment. Because of the choices I made as a teenager, with the help of my school's financial aid department (who recommended Sallie Mae), I will never own a home. I will probably die before the loans are paid off.

Thank you PBS and Robert Applebaum for making me feel sane. It's so nice to hear others say what I have been trying to tell people for three years. Sallie Mae lies, harasses, and steals with every chance they get.

Commenter: Linda Cannone
Hope that the single Baltimore mother featured on NOW this week receives some help.
My heart goes out to her. Where's her bailout?
All she's guilty of is having hope and faith in the American dream. --Go to school, work hard, make a better life for yourself and your child.
What's wrong with America today?
Please update us on her story. Sadly, she's not alone.

Commenter: jackie
Regarding Student Loan Debt. My sympathy is with the young woman in the story that found herself $70K plus in debt. I concur this is yet another "regulation" need in our govt. loan process. However, here are some alternate thoughts. I too attended college and achieved an MA degree. I was not "advantaged" and had to rely on "some" student loan funding. MOST of my friends had loans as well. But ALL of us had jobs at all times throughout our BA schooling. While we needed some student loan funds, we NEVER considered it an option to not work and manage our living expenses, food and clothing. The loans were for tuition. If indeed this young woman allowed herself the luxury of full time schooling without work, she created some of her own problems. Such luxury was "unheard of" in my world. Further, once the BA degree was achieved, or all of us including me, we worked full time and achieved the Master's degree along with full employment. I'm guessing she maxed out her loan options because she was not diligent about assuming more economic responsibility during schooling. Living at home or with family, working, and full time work while achieving a Master's may not have been part of her equation. Who of well educated people would "pass" on their rent in order to pay a loan? She's young, but should be better informed or sought guidance. Just some thoughts. I do sympathize with her, but I overcame greater odds and still managed to achieve. Now...she needs to go get 2-3 part time jobs, move in with family or friend, room and board arrangement accompanied by babysitting while she works. There are many needy families that would partner with her.

Commenter: Beleaguered New York University Graduate
When will local and national politicians and bureaucrats become more than mere puppets to the billionaires? When will borrowers become active citizens with LEGAL RIGHTS - not passive consumers with FAR FEWER RIGHTS THAN MULTINATIONAL FINANCIAL SERVICES COMPANIES?

The Master Promissory Note 400, the document I signed upon consolidating several CitiAssist private student loans, indicates, "If I [the borrower] am unable to repay my Loan according to the terms of the Note, I may request that you [the lender] modify the terms of repayment." I have pressed Citibank staff to fulfill this promise since January 2009. I expected Citibank staff to demonstrate a willingness to adhere to the company's own legal contract by processing a request that Citibank modify the terms of repayment of my loan. Shockingly, for six months, Citibank staff have demonstrated disinclination and outright refusal to fulfill the company's promise. Citibank staff indicate that they do not intend to fulfill the promissory note's promise until AFTER I default on the loan - though the promissory note makes no such specification.
I officially complained the the Office of the Comptroller of the Currency, a federal agency. After taking three months to process my request, what was the OCC's response to me? A letter that copied Citibank's most recent correspondence to me - word for word. I find this to be despicable.

Commenter: Courtenay
This was an excellent report. A woman who wanted to get an education, support her family, and better her community as a social worker, has to act like a criminal by defaulting on her loan payments. If someone doing the "right" things is falling behind in the system, then either the system itself needs to be changed, or we must start admitting that our education system is designed to reward the wealthy and screw over another pool of "sub-prime" loan recipients.

Commenter: Jay
For the people putting all the blame on the students: is it right for a student to to take out money for school and living and have to pay back quadruple the amount borrowed? No. I borrowed 30,000 for tuition and living, and at the end, I have to pay back almost 140,000 dollars. Why do I have to pay 110,000 more dollars? It's not fair. When I borrow 20 dollars, I pay back 20 dollars...not 100. The institutions are the one's who are supposed to inform us on interest rate and what we can look to be paying a month. I, and many others, were not informed of the 18% interest rate and 800 dollars a month payment. I have a four year degree that I took With Ed Financial, and the monthly payments are 125 dollars at a low interest rate...very reasonable. I work hard for what I do make, and I don't think I need to work that hard to pay 800 a month for a student private loan and have to live in my car. It's these private lenders that have the power to do whatever they want. It's the lack of student loan protection. If Sallie Mae wants to bump my interest rate to 50%, they probably could. Lack of student loan protection. I'm going to pay back what I owe, because that is the kind of person I am, but not an extra 110,000. For what? I only borrowed 30,000.

Commenter: klara
i was grateful to my country for the national direct student loans and pell grants that got me through college in the late 1970s. my education moved me and my siblings from lower income to middle income.

the interest rate was 3% and i only needed to borrow about $3,000 to go to top rated universities, still it took 10 years to pay off.

i was appalled when the government added the for-profit middlemen. in the mid 1990s i actually worked for a "student loan guarantee corporation" who was also a lender and saw the compounding of regulations, red tape and interest rates.

higher education is simply no longer affordable for anyone who isn't already wealthy...and it's more than a shame, it's a disgrace. where's the level playing field?

Commenter: MB
My comment is to express complete support for Gina who is doing a great job under sh*

Commenter: John
Too bad the young lady did not live in Denmark where they give you a stipend to go to college with no tutition costs to the student. From health care to education we short change our citizens.

Commenter: MB
Hi, good work on this story. There is an important article about this issue called, "Are Students the New Indentured Servants?" by Jeffrey J. Williams, Dissent Magazine, found via http://www.alternet.org/story/121955 You should talk to him!

He says:

"College student-loan debt has revived the spirit of indenture for a sizable proportion of contemporary Americans. It is not a minor threshold that young people entering adult society and work, or those returning to college seeking enhanced credentials, might pass through easily. Because of its unprecedented and escalating amounts, it is a major constraint that looms over the lives of those so contracted, binding individuals for a significant part of their future work lives. Although it has more varied application, less direct effects, and less severe conditions than colonial indenture did (some have less and some greater debt, some attain better incomes) and it does not bind one to a particular job, student debt permeates everyday experience with concern over the monthly chit and encumbers job and life choices. It also takes a page from indenture in the extensive brokerage system it has bred, from which more than four thousand banks take profit. At core, student debt is a labor issue, as colonial indenture was, subsisting off the desire of those less privileged to gain better opportunities and enforcing a control on their future labor."

Commenter: Dr. L.
I currently owe $400,000 in student loans--250k federal and 150k private--which I used to get a PhD in Clinical Psychology. I currently make 57k/year working at a state hospital. I'm not too concerned about it, given the various loan repayment programs that are available. I pay $650/month (interest only) for my private loans and $750/month (soon to be $500/month) on an income-contingent repayment plan for my federal loans. Because I work in a public service job, my federal loans will be forgiven, tax-free, after 10 years. That leaves the private loans, which I plan to make substantial principal payments on in the coming years. I have seen little mention of these programs in the comments. And there are several other forgiveness options available as well.

Commenter: Michael
This was the finest news program I've seen in years. It educated me, touched me, and alerted me to a serious problem in this country I was previously unaware of. I'm only a casual viewer of Now on PBS, but this program convinced me both to watch more often and to donate to your show. TV of this quality is truly a public service

Commenter: Mike Smith
Your show on student debt told a very compelling but, sadly, not a unique story. Some viewers here want to blame the victim as, for instance, the one who suggested she should have waited to start a family. Did you miss the point that your lovely daughter is nevertheless the result of a sexual assault? Another writes that she made bad choices. That's true only if the American dream itself represents a bad choice-get a good education, get a good job, raise a family. I wish there was a link here where I could send her $50.

Commenter: Douglas Noble
This is what they call INOVATION!!! Maybe people should go to work first then they would find out how hard it is to earn that they need to pay back. Education is going to be the biggest FAUD since sub-prime or the WMD. We don't teach people how to think or question anything or anyone. SEC was told 4 over 5 yrs that Madoff was a fraud but those Highly Educated Investgators couldn't be told anything. Brain wash by Theory's. A lemonade stand will teach business better than Harvard, all it does is provide social contacts of the wealthy. FYI Bill Gates knew how to thing and didn't need Harvards' piece of paper and look he is the Richest Man in the world!!!!!

Commenter: Itiolair Gates
It is the student's responsibility to read all loan agreements before they sign and accept the financial aid. One should know about forbearance and deferment before signing the master promissory note. I feel her pain from what she is going through; however, there is no reason to not know these and other critical things before accepting such huge sums of money, especially when one knows that the money has to be repaid.
If the governments, state and federal, began supporting higher education at the rate they should, all of us would benefit from less student loan debt and a more academically-advanced populace (with a higher spending power, boosting the econonmy).

Commenter: Peter Theis
Student Loan Debt is the scam of debt slavery. Bailouts and bankruptcy available for bankers and Wall Street and corporations, but debt slavery for their "subjects," We The People? It is NOT just about doing the "right" (programmed) thing of paying back loans, it is actually about the fact that the RIGHT thing is no one should have to pay such huge amounts to get an education, or to have health care, or any other basic human decency/rights issues. There's a website called ReduceTheRate.Org and I say NO, not reduce the rate, make the whole thing free, as it should be. Period. Take money we waste horribly on the industrial military complex to pay for education. Take money we waste allowing credit card companies or crooked bankers or Wall Street vermin to profit grotesquely and use it to give people health care. No, it's not about tweaking the system to make it a more "fair" form of slavery. If we really think about, what is fair is abolishing these systems of debt slavery. We need to stop focusing on the symptoms of the illness(es) and start focusing on the root causes.

Commenter: Darren
This discussion of who is to blame for college students going into debt overlooks higher education's role in perpetuating the myth that its coursework is the best approach to gaining marketable skills. Let's get real. Higher education is largely concerned with preservation of its exclusive authority to convey professional credentials such as the very expensive MSW degree that your program's subject was conned into pursuing. The exploitation by the "education-industry" has long ago trumped actual learning. This mendacity is certainly where much of the blame lay.

http://islandnotes.wordpress.com/category/education/

Commenter: Rose
Of course some of the responsibility lies with the students and a part of the problem is the ruthless lending practices but I did not hear your story address the other big player in this travesty, the universities themselves. I am sure there are exceptions, but of the 5 private colleges that my son applied to all 5 expected him/us to take out loans totaling between 10 and 15 thousand dollars each year of his education. These loans were listed as part of his "financial aid package", since when did giving a student a financial yoke around their necks equal financial aid? Shame on the schools for listing it this way. Some of them actually list how much "aid" they are offering and then say at the bottom that you (the student) are responsible for x amount of dollars. Guess what, the amount they say the student is responsible for does not include the loans the college offers as aid. Gee, I kinda thought that if it was a loan the student would be responsible for it...and some people wonder why these kids don't know how much debt they are getting themselves into.

Commenter: Tim Ryan
I guess anyone who borrows against their future is a fool but here is my story.

I was going nowhere, working at one job and another. I got re-involved in making art, specifically sculpture, in my late 20's early 30's. Everyone said that if I wanted to teach, to do something related to what I loved, I needed to finish a Bachelor dergree then get an MFA. So I went back to school in Alaska only to find that all my credits had lapsed. 3 years to finish Bachelors degree = $5000 loan.

Moved to California, sought residency, so I could go to UC or CSU system school and get subsidized education at that time {late '80's).
Got financially stuck in N. Ca. town, figured way to get out was to to apply to local CSU school, start on MA, then transfer to a school with MFA program. Oh yeah, Reagan stopped the subsidies, I became a father while at the school. Cost of loan = $20,000.

Got accepted to another CSU school after repeated tries at various schools. Moved family to new California town. Got grants and scholarships based on my work. Got degree. Got one teaching job, parttime for 2 years. Cost of degree = $20,000.

Broke up with partner, took whatever job I could find to support my child. Put loans in forbearance. Had to start paying in 1998. Have been paying $360.00/month since 1998 and now still owe $47,000.00.

Oh yeah, I'm 58 years old. Won't bore you with the bankruptcy I had to go through.

If any young artists ask me about taking out loans to go to art school, I tell them forget it.

Commenter: pb
I have over 200K in student loan debt as I study to become a psychologist.

If I take a graduated repayment plan, I will take 30 years to repay more than 450K.

Wait, no...I will take these debts to my grave.

Perhaps the best idea is to subvert the dominant paradigm with exorbitant borrowing and allow the massive bubble to simple explode.

Let them eat cake, she said...

Viva la revolucion

Commenter: gb
What is the point of this sob story? Should tax payers be footing her bill?

Commenter: Loralee
Those commenters who argue that Gina lacked "personal responsibility" believe that because the truth is terrifying -- any of us can work hard and still fall short. Blaming Gina for something -- anything -- allows them to hold on to their ideology. Here are my more direct translations of what these people are saying:
"She was too poor to attend college before she began her career. She should have floundered in a low-paying, dead-end job for as long as it took to save for college."
"Social work is admirable and all, but she needed a paycheck more than meaningful, important work (and let's be honest, social workers are just giving hand-outs to other deadbeats...)"
"An education is a 'thing' just like any other 'things' people want but can't afford."
Lee even seems to be blaming Gina for her rape, or for not aborting her child.

Commenter: Mark. C., New Mexico, USA
This was an excellent portrayal of the plight of those burdened with student loans. However, while the program mentioned in passing the escalating costs of a college education as one of the causes for large loan balances, there was a failure to connect the dots in the opposite direction. Wall Street's "innovation" of securitizing mortgages flooded the housing market with "free" money, which, in turn, caused housing prices to disconnect from their underlying fundamental values. Any mechanism which eliminates the risk of default for the loan originator will cause inflation in the goods or services for which the loans are issued. In the case of student loans, securitization is also at work, as are the government guarantees backing Sallie Mae loans as described in your broadcast. Clearly the cost of a college education has been driven out of line with its actual value if graduates cannot afford to pay the loans off in a reasonable amount of time. Someone saddled with student loan debt for the rest of her life is essentially an indentured servant. No wonder Ms. Moss would like to give back the degrees and be free of the debt.

Back in the 1970s I was easily able to put myself through college without borrowing anything by working 20 hours a week. (I admit I had a much clearer notion of needs and wants than many of today's students seem to have; the cell phone had not yet been invented, but I didn't have a home phone either as that was a monthly expense I didn't need and I spent my time studying rather than talking on the phone. Yes, I sound like an old man talking about walking ten miles to school uphill both directions.) College was affordable if for no other reason than there wasn't a flood of borrowed money being thrown at colleges, and educators and educational institutions knew better than to think academia was a venue for making big money and building monuments to themselves.

Reintroduce the notion of risk to lenders and they will stop flooding markets (housing, education) with money that serves to inflate prices, while lining the pockets of the greedy lenders and eventually leading to financial crisis for the borrowers and the nation as a whole.

The root cause of all this is the profound and pervasive worship of affluence which has swept through our society in the past 20 or so years along with the preposterous notion that people and governments can borrow their way to affluence.

Commenter: James H.
This story of Gina and the rest of our youth going to college to attain that higher education are wonderful but, not affordable. It's a shame that when they graduate they are so behind on their student loans and not even in the workforce as of yet. Wow, I wish the elementary and High Schools in their curriculum would emphasize the topic of Economics and prepare our youths the survival skills they going to use in this wonderful land of Democracy and opening market.
And for Amelia C. Reque, you can log on to this website http://www.kiva.org and ask the world for a loan to pay off your debts and then you can pay them back a little of a time.

Commenter: John Poteet
I had to leave college before completion due to illness. My student loans are not repayable any more than my medical bills are. Without adequate health care I will not be able to return to work and without student loan forgiveness people like me will be unable to rise up. Employers routinely deny job applicants due to credit scores.

Without adequate job opportunities and entry channels into the middle class outside of college educations people will take on student loan debt to get through college. If life's circumstances interrupt college educations those loans cripple the people who need assistance most.

Commenter: Wenonah
I do not know if you are still accepting student loans stories, but here is mine.
I got out of graduate school with about $60,000 in student loan debt through two lenders, CitiBank and Alaska Student Loans. I was keeping up, but barely.
Then I got sick. I spent 45 days in the hospital and almost lost my life.
What I was left with was a sea of debt. Three months after getting out of the hospital, I lost my job. My church ended up helping me make my rent payments every month.
The Federal loan was put on deferment. But the Alaska Student Loan Corporation said my credit was too poor to defer and too poor to consolidate and lower my interest rate. In addition, they told me that even in bankruptcy protection, they could still default me. They would simply have to wait to collect on the default. In February my bankruptcy was finally discharged.
I was able to stay out of default. I met a wonderful man who has no student loan debt. $1,000 or my $1,300 unemployment check now goes for student loans. I want to get this ugly thing paid off once and for all, but know that it will be a long haul.
Before going bankrupt, I had worked at paying off my bills. I had less then $5,000 in credit card debt. Even with the bankruptcy, I am still strangled with debt.

Commenter: Teacher
To Lee who said that Gina made bad choices and she should have started her family later. Do you mean she should have aborted the child she had as the result of being raped?
Do you mean being raped one of her bad choices?

Expletive you!

Commenter: Suzanne M. M. Warner
I am 61 years old, female, was a single mother with no child support. My son is now 30. I have a Masters degree in Art History/Anthropology/Native American Studies and have been working at historical museums for 15 years. My son's father would always get out of paying support, after a while I stopped asking and just worked harder....school was my support, it provided some reduced housing, day care and friends and colleagues who were in similar situations. I recieved as many scholarships as I could qulaify for and had a 3.8 GPA and I borrowed altogether about $25,000 thinking it would be a good thing and while I have done pretty good for me, I fractured my spine in the late 90's and had to put the loan on deferment not totally understanding that it would keep growing. After I settled the insurance claim I consolidated and then it changed lenders without my knowing and suddenly I was in default. It has taken years to get it straightened out. Last year I paid $600 a month for 9 months to a collections agency in order for them to forgive 25% of the loan which they did and said I would then be paying less....but it turned out to be $14 a month less so now I have to pay $586.00 a month and this is a governmnet loan. I cannot consolidate again or lower the 8% interest. I pay it to the US Department of Education. My loan is over $75,000 now. The $586 is mostly interest not principal. I make $42000 a year before taxes. I cannot buy a house....I have never in my life owned anything new, or had a house of my own. I do not own anything new, I cannot afford it. I have no future and certainly not one in my field since most museums are not being funded. I have worked for fifteen plus years saving the history of this nation and for that I have no future. Go figure. But they can bail out the banks and the auto industry,but not an intelligent, harmless, generous and loving elder. It makes me very sad. I tried so hard to do all the right things....

Commenter: Noel Oates
Is there any way to send this single mom a bit of $ help?

Commenter: jeninmaine
It is discouraging to hear people put their experiences above that of Gina's. To watch her try to balance her life while we sit here and judge is discouraging. We all can't be so lucky as those who have wide support networks or who already have the answers or who know the right questions to ask, can we? It's so very easy to say work before doing unless you have been in poverty and want so much a better life. I'm quite sure she did not plan to be sexually assaulted. Her beautiful daughter who cried at leaving her things behind was heartbreaking. No mother wants to put her child through that. It was clear Gina didn't. It's not as if Gina is having child after child, wishing for something more. Her only wish was that of knowledge, and understanding, of new experiences of meeting people - seeing things. All things that should not come at so high a price. Education should never come at the high price of giving into debt collectors or that of having a warm and safe shelter.

Commenter: Jeanne Uhl
What a sad touching story. It is so hard for young people to navigate through all the possible pitfalls.Is it possible to donate some money to help Gina Moss and her daughter?

Commenter: SPR
Your report was full of half-truths and did not explore all the reasons for high student loans debts. Why did your report fail to mention the high number of students who borrower more then they need and spend it going on spring breaks or buying expense equipment that is not necessary for their degrees. Also, how come you did not mention that students are required to take entrance and exit interviews and are educated on what a loan and that is will need to be repaid with interest so they know from day one but they fail to pay attention. How come their what no mention of the last five years of Financial Literacy programs that has been happening on a high school level and college level to further educate people. Most of these borrowers are to lazy to take the time to read what they are signing. I am from a small town of less then 500 hundred and went to a university with an undergrad population of 30,000 and I understood that I was taking a huge amount of money out to go to school and it would be hardship when I graduated. I repaid every cent of my multiply loans it took me many years but I knew it would at the time I signed the papers and got my money. My family did not teach me any financial planning either but I knew what a loan was and that it is repaid with interest. Also I kept in contact with my lenders and got help when I needed it. I took responsible and kept looking until I got help and did not stick my head in the sand. Why did you not discuss the entire loan process from start to finish you chose to take the easy route and I resent that I was responsible and these students who thinks the world owes them I am tired of their laziness and want them to start taking responsibilty and stop expecting everyone else to BAIL them out.

Commenter: Marc
Some of you are rather heartless. Yes, everyone should be careful but these are kids. Someone even commented that Gina should have waited to start a family? She was assaulted. Talk about responsibility? Where is the responsibility on the part of lenders? They get to loan money with NO risks! Then they scheme to make even more money from outstanding loans. The government (you and I) absorb all of their losses in the case of default. It's a joke. I have been responsible with my own loans. They will be paid in full come November and I have made plenty of related sacrifices. I can still see this story without blaming the borrower however. Focus your outrage for the corporations that have gotten rich with the support of your guarantees.

Commenter: Jesse Swan
The outrage is that student loans are backed by the federal government. My loan is consolidated with Sallie Mae and it would not let me out of the loan to go with another student loan option. They have me trapped, with the backing of the federal government, at 9% and they have the option not to let me out to go with another lender, which I had arranged at a rate of 1%. The real problem is that the federal government is doing this. The government should not create traps for Sallie Mae to capture citizens. My congressman, Bruce Brailey, has said that there's nothing to do about this, but there is: Change the law the congress made. I originally borrowed a total of under $30,000, and through Sallie Mae's tactics, the loan went up to $50,0000. We can give billions and billions to rich people; give some billions to the Americans like Gina and like me (I'm a professor at a public university) as *loans* at low rates, like 1%, and ways to earn forgiveness for portions of the loans (like teaching at a public university or doing social work). Thanks for broadcasting this report and providing this space for comments.

Commenter: k. fann
loved this episode of NOW, i am way above college age and have a son who is in his junior yr on a full scholarship, it was heart breaking to watch this single mother and her struggles, hopefully sometime in the future we can find out some good news about her situation. hopefully sooner than later. great program!

Commenter: Myron Tutunjian
The only thing not her responsibility was the assault/rape and resultant pregnancy. It's called person responsibility. How can someone with the intellect to achieve a Master's degree be so financially ignorant? She made bad choices. She wanted "experiences" and to "meet new people" so she took out loan after loan to attend college and got multiple degrees. That was her choice. She could have worked first, saved, and then embarked on a more modest incremental effort. If you can't afford something, you don't buy it, or you defer until you can. But everybody seems to be entitled. Your show is shamelessly one sided. Try doing a show on the hard working Americans that work and save and sign on for only that which they can afford. They pay as they go without expecting others to pay or bail them out. You can include corporate welfare here also. We all want things. You've got to earn them and live within your means. Something the government of both parties hasn't learned.

Commenter: Peace Hudgens
My husband and i have about 200k in student loan debt. we are doing our best to keep up. I was touched by the single mother's story. we are in debt to our eyeballs and have defaulted in our credit card debt. but we have a roof over our head and would like to offer a room to the single mother until the economy gets better and she finds a job.

Commenter: Lee
Gina's ambition should be applauded, however it seems she made some poor choices that have left her in this terrible position. Social work isn't a very profitable career and probably not the best choice for a single mother. Better yet, Gina should have waited to start her family.

We should do everything we can to make education affordable for the youth but there can never be any substitute for responsibility.

Commenter: Amelia CReque
I am a survivor of domestic violence. I had to drop out of school. I had 29 credits to graduate. I was homeless for six months and then I was housed. I am working, but it seems that now and everyone is asking for their money, and I cannot even save. I am paying my student loan, but I also owe tuition. I would like for someone or an organization to purchase my tuition loan and I am willing to work for them to pay it back. This will allow me to go back to school and finish my degree. My senior year is also the first year of my master. I have missed oyt on so many jobs because I do not have my degree. can you help or direct me?

Commenter: Hallie
My Loan was being paid on time when the collections lawyer (Illinois Student Assistance Committee) asked my mother's estate lawyer to send my entire inheritance, the executor did.

Commenter: L. Franco
I managed to double my student loans through the advice of Citibank Student Loans to go on a Hardship Deferrment. I also didn't realize that I was paying interest on interest and principal. I now have to make payments of $500/month. This is disgraceful.

Commenter: E. Martin
Both of my children has college debt. But one went on to law school and now has almost $150,000 (yes, the number's right) in debt for law school - and law firms are cutting back too. He has one year to go and is worried about what the job market will be in 2010 when 2009 law school graduates have been asked not to show up for work until January 2011! Our kids bought the 'get a college education and you'll get a great job' story hook, line and sinker. and now they are faced with years of debt --- and where are the great jobs. And a 'teach American' job is not going to pay for those law school debts!