The Student Loan Hoax

Daily Conspiracy Writers

The world is nothing like you thought it was..

Student loans are scary things for parents and new college students alike. Signing up to take on as much debt as a small house is quite the commitment. Most 18-year-olds don’t fully comprehend the endeavor they are signing themselves up for. In fact, it was reported by the Wall Street Journal that 4.6 million Americans are behind on their federal student loan payments. The total student debt is now at $1.4 trillion, which is more than double it was a decade ago.

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With that in mind, the Trump Administration announced this week that it is considering changing a current federal law that makes it difficult for those filing for bankruptcy to erase their student loan debt.

“A decades-old federal law prevents Americans from discharging student debt in bankruptcy court unless they prove to a judge’s satisfaction that they face an “undue hardship,” such a stringent standard that few borrowers even try,” writes the WSJ. “The Trump administration can’t change the law without congressional approval. But it can decide how aggressively to fight a borrower’s request to cancel loans in court. The government, the nation’s primary student lender, has traditionally fought such efforts, since any failure to repay loans comes at a cost to taxpayers.”

The 1976 law requires borrowers to prove in court that they have experienced an “undue hardship” to get their student loan debt erased, but Congress has never defined the term.

These cases have been settled based on what the judges perceived the term to mean. There have been very few cases where borrowers’ student loans were expunged in their bankruptcy claims.

WSJ reports that only 500 individuals out of the 766,000 bankruptcy cases were able to erase these loans last year. Not to mention, these cases can be expensive since they are often over a span of a few years. Also, the majority of those filing can’t afford sophisticated representation.

On Tuesday, the Education Department announced that it would take into account the public’s input on if the policy needs a change.

Student advocates have been lobbying to change the law to better protect borrowers for years.

“The department will review the data collected to determine whether there is any need to modify how undue-hardship claims by student loan borrowers in bankruptcy are evaluated,” said the Education Department.

However, this could make it more difficult for Americans to borrow and would evidently make it even more difficult for the Department of Education to collect the debt owed.

“The Education Department already struggles to collect on student debt and recent reports suggest that government lending to college and graduate students could soon become an immense drain on federal coffers. As of Sept. 30, 22% of Americans with federal student loans hadn’t made a payment in at least a year,” writes WSJ.

The costs for universities and college are at an all-time high and the majority of Americans take out loans to help cover these expenses.

The Trump Administration is aiming to cut the significant federal funding that is being funneled into student loans in the latest proposed budget plan.

This plan would increase monthly payments, but reduce the length of time to get loan forgiveness – along with eliminating the Public Service Loan Forgiveness Program for those working full-time in qualifying public service positions. The budget also proposed to put an end to subsidized student loans. This would mean the interest would start accruing once the loans were taken out versus after they finish school.

While the current federal loan program will cost taxpayers $170 billion over the next ten years.

  1. Post Author

    Federal Reserve (not “federal” & no reserves) counterfeit money loaned at interest, for education to obtain jobs long ago sent to Red China via WTO treason. Makes no sense.

    • Post Author

      Forgive the loans
      Cost is way too
      Much for taxpayers

    • Post Author

      Nice summary!

    • Post Author

      Good point on the ( Not , Federal and no reserves)

  2. Post Author

    If someone wants a college education then let then enlist in any branch for at least 2 enlistments and the apply for VA Benefits. If they don’t want to do that then they or their parents can foot the bill in full without Federal taxpayers help. NO where in the Constitution is anyone guaranteed a college education that is a privilege not a right, for the most part these college educations have been dumbed down or socialized to the point where most that graduate are no smarter than when they went in.

  3. Post Author

    Well they are not babies as we are always reminded of Like the destruction of universities and the constant reminders that they are now those in charge .Well be an adult and pay your own bills .If you can’t afford to go then work your way through it .The rest of us don’t get to play and waste money that belongs to taxpayers while communists are pushing and you listen to their instruction of protesting instead of learning . Americans are not responsible for paying for millions of illegals to go to school .Americans young have been put in the bottom .If it is for Americans to go to school then go on a payment plan .Its your dream not ours .They need to learn if you want something it is not free .Illegals should not be allowed one dime of The American Taxpayers money .If they even pay taxes it’s under a stolen name !

  4. Post Author

    I have successfully litigated two student loan discharge cases in the US Bankruptcy Court for the Western District of Washington in the 1990s and the 2000s. In those time periods, all you had to do to be granted a discharge was:
    — show that the student loan had been “due, payable and owing” for more than 7 years, and like any other bankruptcy,
    — you did not have the means to make repayment, primarily that you were unemployed.

    In other words, after 7 years from the date of first having to make a payment on the student loan, the bankruptcy is handled just like any other Chapter 7 bankruptcy (i.e. “straight” bankruptcy and no attempt at repayment through Chapter 13 Reorganization bankruptcy).

    Books on student loan bankruptcy:
    — Student loan law : collections, intercepts, deferments, discharges, repayment plans, and trade school abuses 1931697299
    — Take control of your student loan debt

  5. Post Author

    — Student loan law : collections, intercepts, deferments, discharges, repayment plans, and trade school abuses

  6. Post Author

    What about past debt occurred on loans when there was a truest hardship. Could that debt be reviewed compared to pay hardship and be considered bankruptcy.

  7. Post Author

    Way too expensive
    Forgive the loans and write it off
    Illegals should be paying their own way as our children have
    Too much money going down the drain for illegals
    Gives me indigestion

    • Post Author

      I agree, forgive student loans now. Immigrants come here(legal and illegal) and get free free free including education while my American born children are strapped with a lifetime of interest and student loan repayment. This Country is ass backwards on this and many other issues. Makes one want to hurl.

  8. Post Author

    Can you say “EXPLOITATION” you dumb ass.

  9. Post Author

    What is driving the tuition increase? Answer: Student loans, Grants and inflation in this big business we call higher education. Here comes the College Basketball finals, in no real way connected with education except for the schools name and monikers.

  10. Post Author


    Student Loans are NOTHING MORE THAN ENRICHMENT OF college professors, college administrators and the freedom to continue the free ride on the gravy train of students, at taxpayer expense !

    Undergraduate degrees are now taking 5 1/2 years to complete – why graduate and have to go to work? College professor and administrator pay has EXPLODED, while their workload has DIMINISHED to embarrassingly low levels.

    Construction of “Taj Mahal” facilities through out campuses all over the U.S. is staggering. The college bird of most college towns is the “crane” for the WIDESPREAD new construction all around nearly EVERY college in the U.S.

    But then, eventually the bills come due. And then, the WINNING begins. “We never had to pay for anything before, why now?” And, right on cue, every scheme imaginable is coming out to “forgive” the outrageous debts built to fund the marvelous, but unsustainable life styles of the fat, dumb and happy students, professors and administrators!

  11. Post Author

    I think its a crime the interest rate they charge , mine is 9%, yet my neighbor moved here from india and doesnt have to pay taxes for 7 years , we can bail out the world and we cant give our kids a head start

  12. Post Author

    Some comments on here are simply ridiculous and obviously the writers are totally unaware of the real situation. For medical school graduates there are more graduates than residency spots (substantial amount of the residency spots are offered to foreigners to begin with which is outrageous)! What does a successfully graduated U.S. student who does not match for residency do? Many owe > $200, 000 and WANT to work but don’t get the chance. How do they repay loans with 6% interest? Similar problems are faced by graduating law students. Most students get a degree with intentions of using it upon graduation. The gov’t should not punish students who are trying to be good and educated citizens. If they want to look at financial waste, look no further than the military disability claims. It’s a scam! So many people get taxpayer paid “free” money (often at the salary of a professional for several 100% disabilities) for claiming lies. They pay no taxes and they get preferential job offers? I personally know more than handful of people who are abusing the system by claiming several conditions, and getting 100% disability for each. They then train their family members and friends how to beat the system. Then they roll around their luxurious houses all day long doing nothing. Change is definitively needed but not just in the area of student loans.

    • Post Author

      Requiring someone to repay loans they voluntarily contracted for is not “punishment.”

  13. Post Author

    It has come to the point where the ex-students fully expect their debt to be forgiven. Many are spending extravagantly (pizza parties, drunken forays to Ft. Lauderdale, etc.) with little or no thought given to the repayment cycle. Then they wear it on their caps as a badge of “honor”!
    What ever came of working for an education? Or of taking a work break to accumulate enough for the expenses. That way there is no interest or carrying charges. Get smart.

  14. Post Author

    Why don’t we lower the interest rate in existing loans? Perhaps we would recoup more money rather than former students falling into default. Maybe 1-2%? Some money is better than no money back.

  15. Post Author

    A student loan should be treated as any other debt, which it is, and should be dischargeable in Bankruptcy. On the other hand, if there is a concern about the drain on the department of education, why not make the school attended become the loan guarantor. This might end the cycle of schools increasing tuition and costs over 3 times the inflation rate. I attended a private urban University in the 1970’s which cost my parents $20k for 4 years. The same school is now $70k per year.

  16. Post Author

    They need to study things that produce jobs and not add a bunch of padding like “ballroom dance” to the course load.

  17. Post Author

    Education is an investment in our future. The USA is falling behind other countries in higher education. Calculating a 7-to-1 return on investment, some other countries provide tuition-free education through the degree-level, while the USA has public education only through the high-school diploma — far short of the specialization required for modern good-paying employment! Worse, our government “bailed out” banks, but exploits young adults — if student loans were forgiven, young adults with permanently ruined credit would be free to buy cars and homes, giving a massive benefit to our economy and many more jobs to employ college graduates who now can’t find work equivalent to their education in this country. Cancel student debt, and the thaw on the frozen potential of young consumers will bring our economy forward like never before.

    • Post Author

      You don’t understand. Must college education is worthless the only reason many colleges and classes exist is the federal money that is based on showing up and getting marked present. The real world demands that you show up and produce or you lose your livelihood

    • Post Author

      But that investment is hardly paying off these days. There are far too many Bachelor degrees in Psychology, history, business, economics, etc. These folks will likely never find a job so they go on to grad. school more debt. knowing that many cannot find employment in their chose field. I worked my way through undergraduate school AND paid my student loan off after school. Why can’t other students do that? I think we are coddeling them way too much. This has become a national problem and these student signed up to PAY THEM BACK. The terms of the load didn’t say, if the they could find a job or only if the economy is good. They laid out very specific terms and expectations. I don’t get it.

    • Post Author

      This is a smoke and mirrors issue. Following Marxist rules, we should all be robbed and have no representation from our government. We have been saddled with government entities that get paid and we do not know who they are. We have bills that affect us and we do not know who wrote them-unless you know the names of all the clerks working for our representatives-no, you don’t. You are being robbed daily in every aspect of your life. You assume that this robbery is correct and people that cannot pay back their money are the enemies. Obama was an 8 year enemy and you smiled and let him make his slush fund out of the student loan business. Shut down the EPA, and the other parasites and give the money to students to enter which ever vocation they wish to pursue. Stop GIVING to criminals and expecting American citizens to PAY for Iran’s slush fund.

  18. Post Author

    A responder said: “What ever came of working for an education? Or of taking a work break to accumulate enough for the expenses. That way, there is no interest or carrying charges.” I answer, because without the education-degree, it’s hard to find a job that pays enough to cover escalating school fees that have more than doubled in cost in the past decade! Your “work break” to save up to pay for it would stretch to a hundred years, once you deduct living expenses from the low wages paid! You have the cart before the horse, the answer to your outdated backwards idea is to lower the cost of education to zero, restore student graduates’ buying power by eliminating their debt.

    • Post Author

      The problem is that many of the degrees are worthless. What’s the worth of any degrees outside of STEM, business, etc.? What’s the value of a degree in ethnic studies? Doesn’t a trade-school grad obtain something much more useful than a college degree and contribute more to society, because of the technical- or trade-school degree or certificate? What are the bankruptcy and loan default rates for technical and trade-school grads? What good to an employer is someone with a degree in indoctrination?

    • Post Author

      If what you say is true, then, plain and simple, these students should not have taken out these loans. They knew what they were doing and did it anyway. So now, be responsible.

  19. Post Author

    Bringing an end to the H 1 B Visa (kicking out foreign tech workers) would put some 17 million educated Americans into the work place.

    • Post Author

      Amen to that!!

  20. Post Author

    Take a look at other country’s around the world
    and then take a look at America, America is in decline

    • Post Author

      Right, America is in decline. We WERE second, #2, in the world education system only below Australia. Then in the 1980’s they made up the NEA. Since the NEA has been in business America has dropped to SEVENTEEN in World Education. Another slush fund for the Feds and more restrictions and taxes on Americans. If this is “old fashioned” then I want America to excel and be old fashioned.
      I do not know if you were wondering so I will let you know that I had a school loan and I paid off every cent. Consequently, this wisdom is from observing our country do down hill from all these government entities grabbing our money and ruining our country.

  21. Post Author

    Perhaps the real problem is how much money educators are making, the phenomenal increase in staff in education in general, and that the U.S. Government is spending too much on UN budgets, wasteful military budgets (gee we don’t know where the trillions went but gosh we need more), and so on. Maybe revamping the entire higher education system would be prudent, expedient, and worthwhile.

  22. Post Author

    granted the above. but….look at what professors get paid. that’s the major problem. one law professor in LA was getting 275K a year and only teaching 2 classes in two days. and then the school markups on top of that.

  23. Post Author

    “The costs for universities and college are at an all-time high and the majority of Americans take out loans to help cover these expenses.”
    And guess what one of the major causes of rising tuition costs is; if you said, “Easily acquired student loans”, you win a prize.

    “Student advocates have been lobbying to change the law to better protect borrowers for years.”
    And who is lobbying to protect the US taxpayer from deadbeats skipping out on repaying their student loans? It’s about time that these knuckleheads realized that there is no free lunch, and accept the responsibility that they have taken upon themselves. Maybe if they sought degrees in a subject that would actually lead to a job, like STEM subjects, instead of Gay Studies or Theater Arts, they might have an easier time paying off their student loans.

  24. Post Author

    There are AT LEAST 33% too many “students” in our Higher Education system. Every college in the nation should purge it’s under-performing ~25%, and raise academic standards for admittance.

    The best thing that could happen is to restrict the student-loan pool to students that have exceptional high-school records. and maintain excellent GPAs in their college courses. NO MORE loans and handouts based on “minority” or “refugee” or flat-out Illegal Immigrant status. In other words, no more funding students that can’t/won’t learn. Screw your GPA, the loan is immediately due, and no more additional loans for that “student”.

    • Post Author

      I knew that when Obama took over the school loan business he would steal from it and use it for another slush fund. You discern the poor student yet, you do not see the white elephant in the room. You do not live the way Americans lived at one time. We had our money and the criminals in government did not rob us of OUR money. Now they, for the last 8 years have set up a spider’s web of restrictions and laws to make every person poor. That is your money-not theirs. Have they ever cut their taxes all the while they told us to accept their robbery? No, brazen thieves.

  25. Post Author

    Give loans/forgiveness only for STEM. Force students to focus on the things that will Make America Great Again. I know too many ex-students with degrees in English or Sociology that will never pay their loans. It took me 12 years to pay off mine and education then is no where near the cost that it is now. Also, why is it that I can get a home loan for 4% but education loans are at 7% and 8%? I can get a business loan for cheaper than an educational loan and it is at least able to be written off in Bankruptcy Court.

  26. Post Author

    This is a cart before the horse issue. The problem is that easily attainable federal loans have enabled universities and colleges to inflate tuition charges. If you visit most institutions of higher learning, you will find a bloated staff of professors and assistant professors who spend relatively little time in the classroom while earning six figure salaries and the right to wear elbow patches on their sports coats. Teaching is left to graduate students who earn their way as teaching assistants. It can be argued that those professors are providing a public service by conducting research. That research could just as easily be done by think tanks and by both for-profit and non-profit businesses. This would allow universities to pare back their staffs and offer less expensive and high quality education. Coming full circle, the student loans wouldn’t be as necessary as they’ve become.

  27. Post Author

    I believe that if we shut down the EPA, NEA etc. we would have more than enough money to stop the School LOAN repayment. We have huge amounts that go to our enemies instead of our children. Also, I might add, EPA etc. are not voted in by Americans other wise we would vote out all those receiving our money when we cannot touch them. Also, we should not pay attention to any law composed and written up by those that we cannot vote out. We voted in all of the representatives WE DID NOT VOTE IN THEIR CLERKS, NOR DID WE VOTE IN THEIR LAWS. Shut down any law that a “clerk” has written that we, citizens, have not elected to represent us. By the way, if an elected member cannot do his/her job such as we see in Ginsberg it is automatic retirement. GET RID OF THE CLERKS ALSO. Do you know how silly it is to chase down a dying person, that has no money for a school loan?! You break your necks to attack American citizens and you allow criminals in Washington to live off American robbery (taxes).

    • Post Author

      Excellent response. The leadership in this country has been fleecing the taxpayers for years. Time to stop it and get OUR money back.

  28. Post Author

    try the Canadian solution–you cannot be discharged (through bankruptcy) for student debts less than 10 years after finishing your education. The idea is that the “State” has paid for your education (your asset) and you are, by going bankrupt, erasing the debt. If, after 10 years you are unable to pay back the debt, then, subject to such terms and conditions as the court may decide, you are discharged. So high earners like doctors, lawyers, engineers, whatnot, are not off the hook but we effectively will allow those who take “Arts” and are not high earners but are an asset to society, can be subsidized. (social policy at work)

  29. Post Author

    I ԝager hes PERFECT at іt!? Laughed Larry.

  30. Post Author

    very nice post, i actually love this web site, keep on it

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