Monday, June 16, 2014

NJ CLASS Borrowers: Get In Contact With Me,!

Dear Friends of HESAA Hell,

You know you are burning and not just because it's the summer.  Some of you have the dead weight of HESAA loans to contend with and it won't just go away.  It's time to speak out, if only on an anonymous internet blog.  It's your turn to join millions of people who are fed up with the student loan scam.  Please take a few minutes and write to me your HESAA horror story. 

Hell, I'll entertain email from people who think HESAA is a great deal, even though the interest rates are above federal loans and have even fewer protections than the already abysmal protections that student loans have in general.  All voices are welcome, honest.

One question I'm always concerned with is: How much did you know about HESAA before you borrowed?  Did you know they were actually private, for profit loans being "guaranteed" by a state agency.  The only thing being guaranteed is that they will take your money!  Remember, college used to be a well funded option.  People could go to college for only hundreds of dollars a year, before the politicians used the economic downturn to wage war on people who work hard for a living for very little pay.  There has been no recovery for New Jersey and yet, we still have some of the highest tuition in the country.  Are you mad as hell?  Good!  Write me back.  Ok?




  1. Thanks to my parents not saving I have loans. A lesson to all - only buy what you can afford to pay for and save your money so you never have done to you what your parents did to you and you have to blame someone who made it possible for you to attend college and pay for it.

    1. My friend I respectfully disagree, even as I appreciate the feelings of resentment towards parents who haven't or weren't able to help with college costs. It's not parents fault that year after year for decades politicians sold out to the college loan industry and continually cut grants and subsidies for students who want to go to college. It's the system not the average families who are to blame. That's why we are here, to tell the story of what happened and more importantly to take action to change it.

  2. @Mark,

    Yes, schools and government have colluded for decades resulting in increased costs. When DC decided to guaranty student loans, tuition was a tiny fraction of what it is today.

    Prior to DC involvement, if you couldn't afford to pay or qualify for the loans, you couldn't go to school. However, due to the low costs, working through school was common. At today's costs, you'd already have to be a corporate executive to do that.

    Loan guarantees created moral hazard and lenders severly relaxed standards knowing they were going to get paid. Note the guaranty was never for the benefit of the student, but for the lender, hoping that more people would borrow to go to school.

    Schools quickly realized their position and since they were going to get paid no matter what they charged, why not charge 3000% more. This is where we are today.

    NONE OF THIS IS YOUR FAULT. It's greedy schools, politicians, and lenders all colluding to fleece the public.

    A college degree is a good like any other good. We don't walk into a Ferrari dealer with no means to make a monthly payment and expect to drive off in a Ferrari. Likewise, we don't walk into a grocer with $10 and expect to walk out with $500 worth of food. We don't even try because it's common sense.

    When it comes to a college degree, common sense is abandoned. Student have to have it, regardless of cost. A degree leads to jobs, money and a bright future - none of it true. Except, there is a lot that goes on in between that NO ONE cares about until it's already too late.

    When you apply for a New Jersey Class loan, you know exactly what your obligations are and will be AND YOU AGREE TO THEM. You would not have a degree otherwise. Borrowers all over the country have the same response to this: but I wanted my child to get a college degree, I don't care what it costs.

    That is a wonderful sentiment. What happens when you have the degree, no job, parents are retired and your monthly bill for getting that college experience at Notre Dame is $700? The answer is this: you're doomed. It's akin to jumping off the Love Boat and then thinking about how you can't swim. The only option is to drown, you have no means to do anything else. AND THAT IS YOUR FAULT.

    This is where your lack of research beforehand hurt you. You funded your entire school career with a PRIVATE SUPPLEMENTAL LOAN. Did you know that New Jersey Class loans are funded through the sale of bonds on the federally regulated bond market? By law, HESAA has a fiduciary obligation to the bond holders to ensure the loans are managed in accordance with its charter; IT WOULD BE ILLEGAL FOR THEM TO DO OTHERWISE.

    Enter the distressed borrower in over his head demanding lower payments. HESAA can't reduce your payment because it would alter the terms of the loans by extended the repayment period, thus violating their fiduciary obligations to the bond holders under the law. They want you to be current because their paramount concern is delinquency of loans. They would rather reduce your payment to what you can afford and be current than keep it high and your account delinquent, but they legally can't. Their delinquency affects their bond rating. If their rating goes down, they have to lower the rates on their bonds AND THAT HAS A SIGNIFICANTLY GREATER AFFECT ON THEIR PROFITABILITY THAN THE AMOUNT OF YOUR MONTHLY PAYMENT. Their bond rating is their lifeblood. No one cares what your monthly payment is, it's all about the rating. Since New Jersey Class loans are private, deferments are at their discretion. They can't legally be compelled to offer them.

    I feel for you and all New Jersey Class borrowers and I wish I could talk to people BEFORE they borrow this kind of money. That said, I ABSOLUTELY DO NOT AGREE that any private loan borrower is entitled to any government assistance. The problem exists between you and your private lender. I don't want to pay for your careless borrowing spree.

  3. I think your making a mistake to compare a college degree with a Ferrari! We just want to be able to make a living wage my friend. If you look at the statistics, a college degree, over the course of a person's life, *does* translate to better wages - which is why high school counselors are still recommending college degrees.

    Want to know how much entry counseling most NJCLASS borrowers get before they sign on the dotted line? Absolutely none. Zilch. Nada. Those are your "tax dollars at work" huh? They can't even pay for decent financial aid services, instead it's all about looking at students as walking ATM machines! How does that translate to "it's the kid's fault again?"

    "The problem" isn't simply between the borrowers and the lenders, the problem is the corrupt government loan sharking scheme that makes young people pay through the nose for a degree that is supposed to help them get a job in this economy. I don't want *you* to pay for anything but there are those who can afford to pay! So down with HESAA and bring back scholarships and grants (cut mercilessly by Christie with Democratic collusion.)

    Don't forget we live in one of the richest states in the union, a college educated populace is a stronger and more competitive workforce and benefits the whole state.

    I don't care a whit for HESAA's "fiduciary responsibilities" which is just another *legal* way of fleecing people who are trying to better their lives. We learned from the Civil Rights movement and Thoreau that not all laws are just, and in fact many laws are totally unjust and any law legalizing loan sharking of people who want higher education is patently unjust and should be resisted and rescinded.

  4. You believed the lies and are angry you got raked over the financial coals.

    High School counselors are shills for higher education. They are literally instructed to counsel students to get into college regardless of cost. You're feeling the effects of that rubbish now.

    The argument about a better wage with a degree is specious. The argument is that a degree will lead to better opportunities right out of college. They don't. The natural result was not an upward trend, but a downward trend. Since degrees are so common, employers now have degree requirements to fill low-tiered, lower-wage positions. Many of these positions could be filled by people with no degree or even no college education at all. The ROI claimed by higher education is not universal and isn't predictable in any industry or discipline. The one exception is an ivy league degree largely because of the circles those degrees put you in.

    Additionally, the cost of education nullifies most if not all of the supposed increases one MIGHT see in his or her lifetime because students come out of college in a financial hole. Money today is worth more than money tomorrow (basic economics). Therefore, all the money that you could be saving and investing today but is allocated instead to your massive debt is worth more than those incremental increases you'll see over a 30 year career. That's not even taking into account inflation that will undoubtedly reduce the value of those increases even further.

    While you don't care what HESAA's fiduciary obligations are, they exist, they are very real and they make your predicament completely irrelevant to everyone else that does care. Find the lawmaker that is going to risk an international financial crisis of monumentally epic proportions by turning the bond market on its head so he can save a few borrowers.

    Thoreau also said, "What you get by achieving your goals is not as important as what you become by achieving your goals." You're at that fork in the road. Do you want to take from others to achieve your goal and become exactly the same form of thief you're currently railing against, or do you want to become someone who is accountable for his own actions?