For 10 years, Baker, who was a public school teacher in Tulsa, Okla., checked in with loan servicing companies and was told she was on track...[b]ut it turns out that her $76,000 in student loans didn't get forgiven. Baker was finally told she was in the wrong type of loan. If she'd known that at the beginning, she could have switched loans and ended up qualifying. But she says nobody ever told her.
Whelp, it looks like a lot of people don't get told a lot of things, be they teachers, police offices, or even lawyers, for that matter (unfortunately, the plight of attorneys involved in public service jobs did not seem to figure into the story, probably due to the fact that teachers, fire-fighters, and police officers probably garner more sympathy). And $76,000 is no small sum of money, let alone the six-figures many law graduates carry. I wonder if the courts will consider public school teachers "sophisticated consumers" as well in the ongoing litigation.
The teachers union lawsuit alleges that the Department of Education "knows of — but completely disregards — repeated misrepresentations made by [student loan] servicers to borrowers who are attempting to qualify ... resulting in unwarranted denials of loan forgiveness." In other words, people like Baker aren't given the right information or advice, and many end up in the wrong types of loans or repayment plans and get unfairly disqualified...Navient, one of the nation's largest loan servicer companies, is not commenting on the lawsuit. But the company said in a statement to NPR, "We understand the frustration borrowers face in navigating a complex federal loan program, which is why we consistently advocate for policy reforms to simplify the system."
And so the finger-pointing begins in earnest between bureaucratic government agencies and their quasi-governmental-sub-contractors. If only people had known that PSLF was not a "done deal" at the time it was instituted, perhaps warned others to not bank on this in making their decisions to attend higher education...
Oh, wait. Our own Antiro at the time was bringing up this issue and the other sources that were commenting on it, back in 2014, a good five years before PSLF was to "come due":
Hilariously, the WSJ reports that the Dean of Georgetown Law, Bill Traenor, says that the government's forgiveness programs are not influencing G-town's tuition, which is approximately $50,000 (don't forget the high CoL that comes along with living in Washington D.C.). Georgetown once proclaimed that "public interest borrowers might not pay a single penny on their loans—ever!", on their website. According to the WSJ, G-Town has been "steering" its graduates into public-service jobs "as part of its Jesuit mission." We have data on how many people are in G-Town's public-interest program: 432, up 60% from 2 years ago.
Yep. This was just one of many examples of the Law School Cartel handing out PSLF pipe-dreams like candy. Don't worry about the debt, kids, Uncle Sam will take care of all that for you (somehow, someway...), especially when there is liberty and justice that needs doing! Now, sign here.
Here's hoping that this suit will finally bring attention to these programs, and, as Navient so graciously stated, help "simplify the system." Because nothing says loan forgiveness is here for you like having to sue to properly administer and enforce the program.
Snake oil that the Cartel was more than happy to advertise at the time, so long as it brought people in. Odd that the Cartel does not appear to be falling all over itself to help fix this issue. As teachers and others are now learning what law grads learned the hard way, the attitude is "Let the graduates make their claims and chase a broken system, we got ours."
The list of "hey, we tried to tell you..." items sure isn't getting any shorter.
ReplyDeleteI kinda wish they were more aggressive in their pleading, brought in the loan servicers, and attempted claims for prom estoppel and maybe fraud, but I get the reasoning behind keeping it to federal law with the DOE.
But...But... There was this dean from St Louis University, who smiled on camera and said it was "a back door scholarship" do you mean he lied?
ReplyDelete*cries*
The rate at which PSLF debt forgiveness applications are approved will likely rise sharply over time from the current bizarrely low 1% level, no thanks to the DOE. See the following short SSRN article that I recently posted:
ReplyDeleteCrespi, Gregory S., Why Are 99% of the Applications for Debt Discharge under the Public Service Loan Forgiveness Program Being Denied, and Will This Change? (June 17, 2019). Available at SSRN: https://ssrn.com/abstract=3397656 or http://dx.doi.org/10.2139/ssrn.3397656
This is a personal opinion and not an allegation of fact:
DeleteIn my personal opinion, crooks like you will do anything to keep the sweet student loan money coming in so you can be exempt from the mal-effects of the 21st century economy, including globalization and a general labor surplus. In my opinion, the fact that the federal government allows cretins like you to destroy the naive, uninformed, stupid and/or the poor, and/or lower class, minorities who don’t have the cultural infrastructure to understand you aren’t nothing more than a used car salesman, is a testament to the corruption of our times.
In my opinion, your day is coming. Eventually, someone is going to pull the spigot. In my opinion, if Trump is re-elected, there is a great chance crooks like you will be held accountable. In my opinion, eventually even the people that focus on the “irresponsibility” of you victims will get tired of subsidizing failure factories (even if they get pleasure at watching naive overachievers get obliterated).
In my opinion, you can keep the lie going, I guess most people like you would, what else are you going to do, actually practice law or work for a living, rofl...
In my opinion, you’ll get yours eventually you crook.
I remember reading that before when you linked it, and it reads well but I get the feeling it will lose steam and eventually most people will stop even bothering to apply for the discharge. If it's not formally repealed and removed as an option to begin with.
DeleteI really don't think the DOE wants to write off those loans. And I don't think they are going to if they have a say.
The really big one of course is the 20-30 year general forgiveness, which we're probably going to close in on while they're still kicking the can on the PSLF. I suspect they will remove PSLF and then remove the general discharge when it's time for that.
How is it "bizarrely" low when you have no historical baseline by which to judge the executive processing side?
DeleteIt sure would be a lot easier if Congress would just change the bankruptcy laws to allow overeducated debt serfs to discharge a certain amount of student loan balances in bankruptcy. Sure would beat this kind of false hope BS. Of course, the higher education scamsters might actually have to bear some degree of genuine accountability.
ReplyDeleteThis is a personal opinion and not a statement of fact:
DeleteIn my opinion things would be a lot easier if people stopped focusing on the facts that many students are idiots or uninformed (or both), and instead started concentrating on folks like Mr. Crespin that are making a fortune off of guaranteed federally tax siphoned dollars to operate failure factories.
Pull the federal guarantee and you’ll see how fast this sorts itself out.
This is exactly right. Unfortunately, nobody in govt seems to be in any hurry to pull the feds out. Nothing from the GOP,and nothing from the 20+ democrats running for president.
Delete—— According to the WSJ, G-Town has been "steering" its graduates into public-service jobs "as part of its Jesuit mission."
ReplyDeleteApparently that vaunted Jesuit mission entails public service for the students but high living for the scamsters. In a cynical moment, I would call it Christian charity.
It's been established, over and over, by this blog and others, that the scam is for the benefit of the deans, profs, etc. If that means, er, misleading students about loan forgiveness, so be it. Even with this post, I would wager there are scam schools still telling students to go into public service to get that loan forgiveness. It's dishonest and unconscionable, but so what? It gets OLs to sign up, gets the scammers their $$$, and the scam schools still thrive.
ReplyDeleteSo how, exactly, does public school teaching qualify as service? It is a unionized trade that staffs a monopoly industry protected from any semblance of fair competition. In most places you might not get rich on the pay but you get loads of time off, a full array of benefits and a defined-benefit pension, in may states including lifetime medical. And it is damned near impossible to get fired unless you sexually abuse a child. In my community a child molester teacher was offered the chance to resign on condition no one would tell anyone what happened and the union wouldn't sue us. Off he went to another district where it happened again.
ReplyDeleteThere are struggling solos who are helping people who can only pay modest fees and get no benefits or retirement except what they pay for out of pocket but that's not public service, riding the union gravy train is public service.
Hey all you teachers struggling with loans, under Janus v. AFSCME you can quit the union and use your dues to make loan payments. But then who would try to get you out of the contracts you signed?
Teachers vote. Teachers illicit public sympathy. The public hates lawyers and likes or is indifferent about teachers. Conversation ends there.
DeleteBoomer culture portrays cops and teachers as poor and lawyers as rich. If a cop opens up a security firm and becomes a millionaire or invests in real estate and becomes a multimillionaire, it’s a fluke. If a lawyer becomes rich, it’s the norm. Boomer economy is over, but boomers are still going to boom. Try making a movie showing a Port authority cop driving a Benz and a lawyer driving a civic, and see what happens. Boomers going to boom. They sucked this puppy dry and even as the shell is imploding from the suckage, they won’t even do the next generation the courtesy of displaying reality as it is: bleak. Culture has more impact than reality, and so, the law school and higher education scams roll on. Of course as they die off, eventually reality will be reflected in the culture, and then law school professors might be held to account.
Join the party.
That is exactly correct. People are so dumb that they literally watch TV shows and movies, decide that, wow, on TV lawyers are all rich and cops are all blue-collar losers, hence, I should go to law school! As a criminal defense attorney, I would not recommend either police work or lawyering as a profession, but if one is simply looking for a guaranteed and well-compensated employment, there is something to be said for becoming a cop in a large city. I don't even trust the LSAT anymore: the scores are determined by the intellect of the people taking it, and if the guy sitting next to you taking the LSAT thinks he's going to graduate law school and become a powerful Sports Agent like Tom Cruise in that move (Show Me the Money!) then your score, ranked against his score, is meaningless. I predict that Bar Passage rates will continue to fall nationwide, and new lawyers will be dumber and dumber, year by year.
DeleteThey’ll dumb the bar down. They’ll call it racist. You think these guys want to work under normal circumstances, let alone this economy and this profession? Lol...
DeleteNot to defend the loathsome boomers, but Tom Wolfe pointed out the disparity between how much court reporters made in NYC compared to the DA/PD grinders in Bonfire of the Vanities, some 30 years ago. But that was just as the scam was really taking off, so nobody listened.
DeleteCourt reporters routinely tell me they make more than me (and laugh). Hey, supply and demand.
DeletePoor people, especially poor minorities, do not know about these things. They see the TV, and the culture dominated by boomers. These things tell them lawyers make money and other, less prestigious alternatives, including court reporters, teachers, cops, etc are bad with low income potential. Go to any minority community, immigrant community or any poor community in general and try to convey these this information. You will be attacked and labeled a racist and/or accused of trying to hold back some poor kid from success.
DeleteLaw school professors know this and exploit this viciously. Upper class people that are lawyers have their identity wrapped in being a lawyer. They use the professional status as a way to mask the true source of their financial prosperity. Compound this with the fact that 1) blue collar people who succeed in unionized employment relish when white collar people suffer (because they’ve been put down their whole lives for pursuing that kind of employment versus something “more prestigious”), 2) sociopaths that love seeing people destroyed (and ungodly amount of such people in this line of work), 3) tax payers misdirecting the entirety of their rage and the naive and ignorant that pursue this kind of employment, and 4) law school professors that have weaponized identity politics to keep the money flowing in, and you have a waive-the-hand distraction from the real problem: federal guarantee of tuition and the real criminals: law school professors and administrators.
I’m hopeful Trump gets this issue resolved in his next term, if for no other reason than scammers love nothing more than screwing over other scammers as an act of dominance.
Off topic, but wouldn't you be happy to know that lawyers in small law firms make 6 figures and that puts the average lawyer salary at $155,000. See https://www.nalp.org/associatesalarysurvey2019https://www.nalp.org/associatesalarysurvey2019
ReplyDeleteLove the NALP. Survey covers under 100 firms of under 50 lawyers. Since there are about 47,000 law firms or more in the US, how on earth does the NALP validate its conclusion of $155,000 median salary?
NALP ought to be out of business for this kind of outright fraud.
I thought you were supposed to follow your passions and do what they love, because it is more important that just earning money????
ReplyDeleteDilbert, you remind me of a great story. A friend of mine took the LSAT on his own campus, the campus of one of those universities that is both highly selective academically and has a nationally ranked football program. During the administration of the exam he became aware that the guy next to him, a football player from a traditionally under-represented minority, was copying his answers on the sheet where you fill in the ovals. My friend knew that while everyone had the same questions the order was scrambled to prevent that sort of thing. During the first break he leaned over and whispered to the football player: "You know, we don't have the same test." The football player's eyes bulged out, he muttered "thanks!" and then began frantically erasing and changing his answers, in essence submitting a one-in-four crap shoot n that part of the exam.
ReplyDeleteOne in five, you mean. The expected score, incidentally, from haphazard guessing is 125, if an answer is filled in for each question. And the lowest possible score is 120…
DeleteHad that "student" submitted answers identical to those of another student in the room, the LSAC would have caught the cheater, who might well have found himself kept out of law schools in the US for good. Incidentally, the test is now being changed to an electronic format, to be completed on a computer rather than with pencil and paper, so cheating may become even more difficult.
About twenty years ago, a couple of people had an agent register for the test and run off with the questions in the middle of the exam. They took advantage of the difference in time zones and had someone send answers to them via electronic means. The scheme came undone because 1) the LSAC knew that a copy of the test had been stolen, so it was on the lookout for anything suspicious; 2) the proctors had noticed the use of electronic devices; 3) the cheating was obvious because those two got extremely high scores on the scored sections but poor ones on the experimental section. Both civil and criminal penalties resulted, and I'd bet that the people involved found themselves unwelcome if they ever tried to take the LSAT again.
Don't cheat. If you can't get a decent score, you don't belong in law school anyway.
For a very insightful guy, OG, you missed a key point. Given a choice between being banned for life for cheating and getting a score that would have gotten him into a toilet the former might have been the better outcome. Of course, that story happened when tuition at top-flight private law schools was often stated in four figures.
DeleteHere's another story you'll enjoy. One year I got a job running the law school mail room. Sorting the mail one morning I noticed something interesting. Without opening the letter I could see that an applicant had secured a reference and given the writer an envelope addressed to himself to send it back to him. BUT . . . he had put the law school's admissions office as the return address. When he got the reference he wrote "Not here, return to sender" on the envelope and threw it back in the mail which delivered it to the return addressee. I showed the envelope to the admissions director, telling her I thought she should know the applicant had defrauded the postal service to save whatever a stamp cost back then, twenty cents, maybe. A note was placed in his file, not sure what happened with his application.
But his attempt at cheating was doomed to fail, for the reasons that I gave. Anyone could have foreseen the failure of that effort. So his chance of ending up in trouble was practically 100% and his chance of getting him into a respectable law school was practically 0%.
DeleteEven those who might defraud the postal service in private life should have the sense not to exhibit their corruption when applying to a law school. The director of admissions could quite reasonably have rejected that letter on the grounds that it was addressed to someone else—and then rejected the applicant for failing to provide the required number of letters of reference.
Blaming the Boomers is utterly asinine. Everybody is being screwed and scammed in this new country we are now living in, including the vast majority of the Boomers. The insurance companies, big pharma, etc. buy our politicians, who yes are mostly Boomers, but they are politicians first. And like politicians since Reagan, they are all out for themselves. Can you blame the Boomers for the .01 % who are the Oligarchs of the country? How did the 2 trillion dollar give away to the top .01% help the vast majority of the boomers, many of whom are retiring on nothing but SS available to them, which the politicians are trying to take away? Yea, the student loan program has turned into a scam based on how it has been exploited by the scam higher education system. But what isn't a scam? The President is head of a criminal enterprise that has expertise in scamming the population. Don't paint Boomers with the same broad brush you paint the Oligarchs and their sycophants please.
ReplyDelete"Can you blame the Boomers for the .01 % who are the Oligarchs of the country?"
DeleteWell, yeah.
Boomers voted for tax cuts and increased government spending for 40 years. Boomers endorsed legislation that has erected a true existential threat to the United States at the expense of the nation’s future prosperity, namely China. Boomers were given the greatest expansion in human history and squandered it. Boomers will be the first generation to leave the next generation in a worse condition than the last generation. Boomers adopted and worship the construction of a dialectic that annihilated the moral the infrastructure of the country, which corrupted the positive aspects of the right and the left, eg by way of example, Boomers worship Ayn Rand on the right and Karl Marx on the left, which are both perverse philosophies excusing short term selfishness, one by envy and one by greed, one covertly and one overtly.
DeleteThat’s why the system is so fucked. You can’t get proper capitalism or proper socialism. You get corporate fascism. The law school scam is a prime example of this, it isn’t capitalist or socialist: it’s corporate fascism.
This country was what it was because of a fierce, sceptical, and vigilante population that understood power needs to be kept in check and that human nature is corrupt. Boomers de-balled this country with the 60s hedonism which said do what you want, have a good time, and don’t worry about the future. They corrupted both the left and the right. You have the left demanding a change in human nature on a fanatical level, which usually results in the worst types of people taking power (see professors as a vanilla version) and the right telling is corporations and the top .01 percent pillaging the country and being exempt from every rule and regulation is a good thing because greed is good.
The Greatest Generation would have dug a grave and put cocksuckers like Epstein and the bankers in it where they belong, letting them scream about whatever political ideology suited them as they were buried (that’s why the Greatest Generation buried both Fascists and Communists and provided a CAPITALIST system with REASONABLE restrictions).
I was thinking, why hasn't law evolved like other professions, Medicine: They have us seeing a doctor once a year whether we need it or not. Dentistry: We all see dentists twice a year and sometimes more than that. Accountant: Not so much, but everyone files a tax return and a lot of people go once a year for that. Lawyers: You go to when someone dies or if you get arrested or indicted, or are sued or being sued.
DeleteI know that the concept of the annual legal review with 'your lawyer' has been floated about, but I don't think many people do it, or really have a personal lawyer. How do you get a guaranteed stream of income without economic demand, like the other professions do, for lawyers?
6:51 PM--you don't, because there is more of a need for medical/dental services than legal services. Everyone gets sick and/or injured at some point, sometimes repeatedly. Everyone has teeth, at least to begin with, and will lose them unless they are taken care of. But most people only need a lawyer once or twice in their lives, if at all. The ABA and law schools go on endlessly about pro bono and public service, but as Paul Campos has pointed out, if you make a list of things poor people need to spend money on, legal services is generally far down on the list.
DeleteLet me add two quick things, 9:37.
DeleteCPAs who are friends of mine and trust me to keep my mouth shut will freely admit that loads of people could do their own taxes but are intimidated by the process and hire someone to do them. Unless you've been arrested the government doesn't freak people out so they hire lawyers.
2. M.D.s and Dentists live large on employer-funded health insurance. Lawyers will never get that kind of deal.
With all due respect to Anon 6:51,
DeleteDoctors are not in business because we are told to see the doctor once a year. Many doctors are not in Family Medicine or Pediatrics performing yearly checkups. Rather, many physicians treat acutely or chronically ill patients such as general surgeons performing lap appys on patients presenting in the ED with appendicitis, hospitalists and critical care physicians treating sick patients in the hospital, or neurologists pushing tPA in the stroke patient brought to the hospital by ambulance. For many acutely ill patients, they are only seeing a doctor for the first time in many years similar to your example of the person arrested who hires a lawyer.
If you want to know why medicine differs from law, just compare numbers. I could not find NALPs updated stats for the class of 2018. But according to NALP, there were 34,922 law grads in 2017. According to the latest Match data for the class of 2019, there were 18,925 grads of U.S. Med schools. Law schools churn out far more grads than demanded by the market. Despite a shortage of doctors, U.S. med schools have not lowered standards churned out more doctors than needed to cash in on student loan dollars. Looking back on the application process for med school and law school, and looking back on the education, it is clear that law schools just want to defraud students of student loan dollars. Med schools seek to train the next generation of physicians.
Moreover, the legal market has contracted over the past 2 decades. That is an objective fact straight from the BEA real GDP by industry data. Everyone hates lawyers. So nobody cared when politicians passed caps on medical malpractice. In the 2000s after Texas passed their caps, entire PI firms went under. The attitude of the general public was good riddance. Then businesses got smart and now make all customers agree to mandatory arbitration. So if your bank (Wells Fargo), phone company, or other business screws you over, sorry, you don’t get to hire a lawyer and go to court. You have to go through arbitration. Don’t expect Congress to regulate this practice anytime soon so lawyers can get more work. Then big business started squeezing big law firms. So even elite law grads struggle for work. While the legal market contracted, doctors and researchers developed more therapies and more procedures to treat patients.
This post represents an opinion and not a statement of fact:
ReplyDeleteThese criminals are not going to stop.
https://www.thefacultylounge.org/2019/07/guest-post-california-supreme-court-fails-bar-examinees-by-mitchel-winick-.html
They flat out are not going to stop. Anybody that graduated law school and has not made equity partner in biglaw, is not in a heavily protected public sector job, or a tenured law school professors needs to have their head examined if they ever vote for a Democratic politician again.
Behold identity politics as the nuclear weapon of tax dollar siphoning:
https://www.thefacultylounge.org/2019/07/guest-post-california-supreme-court-fails-bar-examinees-by-mitchel-winick-.html
Sounds like this teacher had FFEL loans, which were abolished in 2010 but grandfathered for existing borrowers. FFEL loans qualify for IBR, but they do not qualify for PSLF. It was pretty widely publicized when the program was introduced that FFEL borrowers needed to consolidate their loans into the direct lending program if they intended to work towards PSLF.
ReplyDeleteBasically, some minimum wage call center employee at some servicer did not know the difference between IBR and PSLF, so plaintiffs like these essentially argue estoppel. The DOE did hire these contractors to speak on their behalf, so it may be fair to give these people some kind of redress. But it should not be ignored that the DOE is correct under the law in making these denials.
People who fully did their homework on PSLF should not be worried by statistics like the 99% thing, because all that tells you is that 99% of people don't read the fine print. Doesn't mean the program is illusory or that obtaining forgiveness is hopeless. On the contrary, people who enroll in a qualifying income-based repayment program, have only direct loans, and whose employer is either a government agency or a ***501(c)(3) [and NOT another type of nonprofit like the ABA] have nothing to fear.
The following post is an expression of opinion and is not a statement of fact:
ReplyDeleteStraight from the horse’s mouth in the comments section: a dean of an unaccredited toilet wrote the statue defining of “JD preferred” and “JD advantage.
I guess the answer is to vote Democrat for more regulations and more taxes. These intelligent and self-sacrificing individuals have the public interest at heart...
“Anon. thanks for catching my mislabeling. The California Business and Professions Code § 6061.7(g)(5) uses the term "JD Advantage" not "JD preferred." You would think that I would remember that since I helped draft the statute and reporting form back in 2016 that added these new disclosure requirements to state law. The danger of casual commentary without editing!
California Business and Professions Code § 6061.7(g)(5) “Employment outcomes for graduates” means the results of a survey by the law school, taken three years after graduation, that breaks down the employment rate of graduates in each of the first three years after graduation, including the rate of employment of graduates in jobs where a Juris Doctor degree is required by the employer and the rate of employment of graduates in jobs where a Juris Doctor degree is an advantage in employment.
We are in agreement that no law school should be "charging folks to obtain a law degree to become a clerk or paralegal." Of course, you can't get (very many) "JD required" jobs without state licensure. The licensure rate in California, based on current bar score performance would be comparable to all other major jurisdictions (NY, DC, FL, IL, TX) except for California's use of an arbitrarily high cut score of 1440. At New York's 1330, California graduates would be passing at 75-80%, not 40-45%. I do not see anyone arguing that NY lawyers are not competent. This disparity is what we are asking the CA Supreme Court to address.”
Law school at University of Maine plans sweeping change by hiring more people and spending more money:
ReplyDeletehttps://www.sunjournal.com/2019/07/19/report-recommends-sweeping-changes-at-umaine-law-school/
Over a week since the last comment, 2.5 weeks since the last entry. With JDU gone, this is the only thing I check for the law school scam. But it looks like it's really slowed down.
ReplyDeleteI hope it's because Old Guy and others are just too busy to bother with it. But if that's the case, it would also be nice to get a final post and I hope this blog doesn't just disappear without notice like so many others have.