"For instance, by "sometime this summer," a 15% monthly garnishment is expected to be reinstated for the roughly 452,000 delinquent federal student loan borrowers who are currently receiving a Social Security benefit. Federal student loan payments ceased in March 2020 during the height of the pandemic and haven't recommenced."
Not every Social Security recipient is 65 or older. Some are dependents of recipients of persons receiving disability payments. (If I recall correctly, up to 22 for dependents in college.) Some of these recipients might be much younger than 65 if they are disabled and receiving Social Security payments for that reason.
It is troubling to think that there are Boomers who did not pay off their student loans by now. I borrowed $1000 when I went off to USC. I forgot about it completely after I dropped out. The reminder arrived Some months later, so I paid it off immediately. (I was not working as a barista.)
What have Boomers been doing if not paying down their loans?
UPDATE: See comment by Mr. Rostrom about collection agencies pursuing paid-off student loans.
getting high?
ReplyDeleteWho says the loan was not repaid? My older sister took out a student loan around 1970, while attending the Goodman Theater School. (Her acting career never went much of anywhere; she once appeared on Broadway, in a show that closed after three days. But her classmates included Joe Mantegna!)
ReplyDeleteAround 1980, she suffered a nervous breakdown, and was even briefly hospitalized. At that time, our father and a friend of his paid off the loan (about $2,500) - or so they told her when she recovered.
Thirty years later, she received a demand to pay off the loan, which with interest and penalties was now into five figures. The debt had been sold to a private collection agency, which showed no interest whatever in searching the records for the repayment. They repeatedly ignored, lost, or mishandled documents she submitted. (Mostly relating to the "settlement" they offered and payment arrangements.)
Her meager earned income and social security were both garnished.
I have no sympathy whatever for those who took out large loans to pay for training in lucrative professions (e.g. medical school) and later tried to default. I took out a small loan in the 90s while finishing my IT degree, which I repaid by 2000.
But coming after somebody for a long-forgotten debt which may have been repaid? Other debts lapse after several years of non-pursuit. And who has records of completed transactions from decades ago?
Most of these collection cases are legitimate, but there are many dubious ones.
Your Sister should change her name to Plaintiff. A Judge and a Defense attorney won't misplace her documents.
DeleteA family member of mine did the same as you. They came after him when I was a child and tried to take his house.
ReplyDeleteOne issue is that a lot of people went into IDR. And then IDR "forgot" about them. And didn't honor the time limits.
A second issue is that many parents signed for loans for their kids. And then the kids defaulted which means the loan providers went after the parents. And the parents had to default as well.
Last time I checked you can draw SS at age 62.
ReplyDelete