"Remember," I say ominously, "there are only two ways to get rid of student loans once you take them out. You can either pay them off in full or you can die."
I mean to be blunt - getting into massive amounts of student loan debt can be a scary thing.
But loan debt is scarier than even I thought, because it turns out that for some loans, death doesn't actually discharge the obligation to pay them off anymore:
In July 2006, 25-year-old Christopher Bryski died.
His private student loans didn't. Mr. Bryski's family in Marlton, N.J., continues to make monthly payments on his loans—the result of a potentially costly loophole in the rules governing student lending.
As the college season nears, throngs of parents and students still are applying for private student loans, long used by students as an alternative to federal loans. But they may be unaware that in cases where the student dies, the co-signers often are obliged to pay off the balance of the loan themselves—a requirement typically not found in federal loans.
Many private student-loan lenders say they have a review process for cases involving disability or injury, and the new Bureau of Consumer Financial Protection will have an ombudsman in charge of private student loans. Yet neither the student-loan legislation passed in March as part of the health-care overhaul nor the financial-system overhaul passed in July requires lenders to discuss with the borrower and co-signer the consequences of a borrower's death or permanent disability, or require lenders to forgive private loans in those cases.
Sallie Mae, Citigroup and Wells Fargo all require co-signers to continue paying loans when the borrower has died or been reduced to a vegetative state.
Amazing - just another example of how this is the banksters' world and we just live in it.