Grieving Father Struggles to Repay Dead Son's Massive Student Loans | Economy | AlterNet

Reynoso’s son, Freddy, had been the pride of his family and the first to go to college. In 2005, after Freddy was accepted to Boston’s Berklee College of Music, his father co-signed on his hefty private student loans, making him fully liable should Freddy be unwilling or unable to repay them. It was no small decision for a man who made just over $21,000 in 2011, according to his tax returns.

“As a father, you’ll do anything for your child,” Reynoso, an American citizen originally from Mexico, said through a translator.

Now, he’s suffering a Kafkaesque ordeal in which he’s hounded to repay loans that funded an education his son will never get to use — loans that he has little hope of ever paying off. While Reynoso’s wife, Sylvia, is studying to be a beautician, his gardening is currently the sole source of income for the family, which includes his 18-year-old daughter, Evelyn.

And the loans are maddeningly opaque. Despite the help of a lawyer, Reynoso has not been able to determine exactly how much he owes, or even what company holds his loans. Just as happened with home mortgages in the boom years before the 2008 financial crash, his son’s student loans have been sold and resold, and at least one was likely bundled into a complex Wall Street security. But the trail of those transactions ends at a wall of corporate silence from companies that include two household names: banking giant UBS and Xerox, which owns the loan servicer handling the bulk of his loans. Left without answers is a bereaved father.

The risk of cosigning on Freddy’s loans seemed to have been worth it when he graduated in May 2008 and began looking for a job in the music industry. He was on the way back from a job interview on the evening of Sept. 4 when he lost control of his car and it rolled over. Freddy’s family learned of his death the next morning.

The grief was relentless; the debt collectors, ruthless. By law, debt collectors must go through a debtor’s attorney if one has been hired, but even after Reynoso hired an attorney, he said they continued to call him every day, several times a day, for about a year and a half: “I would tell them to call the lawyer. And they would still say, ‘The lawyer doesn’t owe us. You’re the one who owes us. You’re the one who has to pay us.’”

Meanwhile, Reynoso was still reeling: “I was crying for him every day,” he said.

The question of to whom Reynoso’s debts are actually owed — and who has the authority to forgive them — is a mystery that thus far neither Reynoso nor his lawyer has been able to solve.

One of Freddy’s student loans was canceled after his deathwithout a problem: his federal loan. That’s because the government cancels student loans if a student dies.

But the bulk of Freddy’s loans were private student loans, which typically offer less favorable interest rates and fewer consumer protections. Only a few private student lenders offer debt discharges in the event of the borrower’s death, though public outcry over specific cases has swayed lenders to grant occasional death discharges.

But for the Reynosos, just figuring out whom to appeal to has been an exercise in futility. Working with a law firm, Francisco Reynoso sent copies of Freddy’s death certificate to any company that sent paperwork about the loans. He remembers being told by at least one company that they’d call him to work out a solution. But no one ever did, he said, and the bills kept coming — each time larger than the last with more interest, more late fees.

This is insane.  And it needs to stop.  I can’t believe that these banks and financial institutions are doing this AGAIN!!  Students need to be able to declare bankruptcy on these loans and there needs to be regulations in place to keep this from occuring again.  I’m just disgusted.  Go read the rest of the article at the link.  This is going to start happening across the country as students can’t find jobs and can’t pay the loans - It’s going to cause complete economic collapse and this time I think it is the banks and financial institutions that should pay - not the rest of us!!!!

368 notes

  1. lasimms reblogged this from anarcho-queer
  2. smdy reblogged this from truth-has-a-liberal-bias
  3. particularspace reblogged this from reagan-was-a-horrible-president
  4. dogsnameisfrank reblogged this from feistyfeminist
  5. holdherback reblogged this from anarcho-queer
  6. mamateddy reblogged this from stfuconservatives
  7. hotdog666 reblogged this from petitsirena
  8. yakotta reblogged this from questionall
  9. green-street-politics reblogged this from petitsirena
  10. wretchedoftheearth reblogged this from petitsirena
  11. petitsirena reblogged this from raggedyanndy
  12. lululavender reblogged this from stfuconservatives
  13. raggedyanndy reblogged this from afrafemme
  14. clear-sight reblogged this from jahloveangel
  15. epistolaefeminae reblogged this from stfuconservatives
  16. yzmakitty reblogged this from stfuconservatives
  17. mattieu reblogged this from stfuconservatives
  18. whatyoucanovercome reblogged this from questionall
  19. occupysfsu reblogged this from theidistouch
  20. theidistouch reblogged this from anarcho-queer
  21. accidentalassemblage reblogged this from tjjourian
  22. fntsycrystal reblogged this from stfuconservatives
  23. tjjourian reblogged this from anarcho-queer
  24. afrodyke reblogged this from stfuconservatives
  25. souseme reblogged this from ainvayi
  26. humboldtoctober reblogged this from rabbleprochoice and added:
    I had a nightmare about a month before I moved to university that both my parents passed away and I was unable to go to...
  27. wearethepiranhas reblogged this from truth-has-a-liberal-bias
  28. politicsplus reblogged this from questionall
  29. questionall reblogged this from questionall and added:
    Wow! 324 notes in 24hours? You guys are awesome!
  30. okorogariist reblogged this from stfuconservatives
  31. kp777 reblogged this from truth-has-a-liberal-bias
  32. thewhitewolfhasarrived reblogged this from rexcerebri
  33. therabbitdown reblogged this from stfuconservatives
  34. jessicathemess reblogged this from truth-has-a-liberal-bias
  35. iron-and-diplomacy reblogged this from jbaines19
  36. happiz0mb13 reblogged this from nametags
  37. nametags reblogged this from truth-has-a-liberal-bias
To Tumblr, Love Pixel Union
>