<p>If she is young, then term life insurance is generally not expensive and especially if you shop around. Also, if you think about it, if she had even had $100,000 in insurance it was probably enough to keep this family in the black because they said the loan cost ballooned due to interest and late fees.</p>
<p>You can’t stop stupid people from doing stupid things. </p>
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<p>She would have only needed 100k and it would have been cheap as a young woman. Frankly, with all those kids, she should have had insurance anyway. </p>
<p>I think there is more to this story. why didnt she have some fed loans. She would have been independent with those kids. Or did she ALSO have fed loans and those were discharged? And where is the father of those kids? why isnt he supporting them? </p>
<p>@intparent there is no lack of compassion, just a lack of mental illness… forgiving student loans is punishing people who actually pay the loans off. What’s to stop a person with a terminal illness taking out a student loan, knowing they are going to die?</p>
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<p>Then what’s the point of having a co-signer if they are not responsible for anything? </p>
<p>It is an non-collateral loan. The bank knows it when they take it. Risk of the primary borrower (student) dying is quite low for many years given the typical age of the population. C’mon… can’t believe this crowd is stick up for the predatory lenders who make many of these loans. And I assume BOTH parties would need to declare bankruptcy to discharge if that protection were provided.</p>
<p>On the bright side, when the now nine year old is ready for college he or she will qualify for the max amount of grants since the grandparents’ incomes won’t be counted on FAFSA. </p>
<p>Did the woman have an immaculate conception? Where is the father of her 3 kids? </p>
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We’re “sticking” up for predatory lenders by not picketing for these loans to be discharged, huh? No, more like we’re sticking up for people to read the contracts they sign! These parents were cosigners. In the event the daughter is unable to pay or passed, the cosigners pick up the rolling ball. This is exactly what happened. </p>
<p>It’s not as if all the lenders didn’t show sympathy. One cut off the interest. But, neither side is innocent here. Private lenders have binding contracts. Borrowers do not read the fine print and do not take responsibility for financial longevity. </p>
<p>People who would be unable to pay their kids’ student loans back in the event the student is unable to (for whatever reason) have no business co-signing those loans.</p>
<p>When we cosign, we are taking a chance. We are making a promise that if the student defaults for any reason, the responsibility lies with us. Parents who don’t want to support evil banks and lenders are perfectly free to decline to do so by passing on the request to cosign. In this case, the odds went against the parents. It’s possible to have compassion for these parents all the while believing that they need to deliver on their promise.</p>
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<p>I agree.</p>
<p>The nursing forum I visit is FULL of threads written by nursing grads who are finding out that their salaries don’t allow for easy repayment of student debt. Many of them are simply crushed by the burden, especially the ones who graduated only to find out that the market for new grads with no experience is horrible in many locations.</p>
<p>I didn’t say it was a good idea for this student to borrow this much. Nor was it a good idea for the bank to lend it. But to have NO way to discharge these loans is inhumane.</p>
<p>I deal with loans every day as part of my job. In some states, when you co-sign you also sign another form that states you understand you are responsible for the debt. Other states just require the verbiage on the contract somewhere. Even with that, every day we speak with co-signers who literally think that co-signing is the same sort of thing as being a reference.</p>
<p>If the government ‘forgives’ a debt, they are just passing that debt on to all of us. Who cares? We are compassionate. When you take away the risk from the individual they have no need to do anything to protect themselves from disaster. (like insurance or frugal living)</p>
<p>If a lending institution is expected to forgive those debts, they have a few choices. They can stop making student loans (where is the compassion in that?) They can raise the rates for everyone else. They can limit the loans to reduce their exposure (no more going to a dream school unless your family is loaded or you get a scholarship). Or they could require insurance which raises the cost of loans…and runs afoul of state laws in some cases.</p>
<p>Banks would much rather loan money on a home or a car that can salvage a portion of the loss when someone skips on them or, sadly, dies unexpectedly. Student loans are a HUGE risk for banks and often the impetus to even extend them is due to fear of government pressure. (very similar to what caused the housing bubble)</p>
<p>If you think compassion is warranted in a situation like this, that is admirable. Please donate your money to the family. Do not, however, force that same burden upon other people who have been more prudent in their decision-making.</p>
<p>Hear! Hear! People really need to stop seeing banks and other businesses as these non-human entities in some alternate universe. They aren’t. They are owned and run by humans who have to pay their own expenses and payroll, and to do that they need to earn more than they spend. They obviously can’t just give away money, though that seems to be expected of them. </p>
<p>I have little patience for undisciplined people who don’t live within their means, and unwise people who don’t take prudent precautions, and then force the cost of their bankruptcies, defaults, and foreclosures on the rest of us. In my town, so many families upgraded their houses on a shoestring about 15 years ago, while folks like us stayed in our starter homes. A significant percentage of them are now in foreclosure, and our taxes are paying for programs to help them stay in their big houses they can’t afford and never should have bought in the first place. (One acquaintance has been living for the last two years in a mansion in a very affluent area on a renegotiated $200 per month mortgage payment!) And some of the ones who managed to cover the mortgage payments on their Mcmansions, now find themselves unable, as a result, to pay for college for their children. How could they save when their mortgage was so high? So their kids take out big college loans, and on goes the cycle of irresponsibility. No one wants to plan for what if their kid were to die, and that is a tragic thing, but there are no guarantees in life. </p>
<p>Maybe she had a liver condition and couldn’t qualify to buy term life insurance…</p>
<p>Perhaps the kids will get an increase in social security under the grandpa’s benefits when he begins collecting.</p>
<p>I don’t get it. She got the education, so she purchased the services. The parents obviously should not have co-signed either way - if she was ill at all, managing to take care of her kids and work full-time might have been extremely onerous to her and then the parents.</p>
<p>When in the US do we let people buy things and then decide “but if I knew then what I know now, I wouldn’t have bought it!”?</p>
<p>You can argue the college costs were too much, but she and the parents agreed to them. You can argue that it is cruel because she died and therefore “couldn’t use the product or service” of her college education. I’m sure she can’t use her retirement fund either if she had one. </p>
<p>But neither of those are pertinent to the law let alone the larger concept of justice. At best, ask the college to rescind the costs of her tuition etc., but therefore they would actually have to reimburse the government for tuition already paid. It would be rather complicated, and I do not know about any precedents for such reimbursement.</p>
<p>Someone <em>will</em> pay, either the parents or the college or the government. It’s really sad she died, but they aren’t asking for reimbursement for her food and clothing while she was in college. They aren’t asking for her health insurance fees back because she ended up dying. They aren’t asking for her mortgage/rent payments back. It is exactly the same thing, another cost that was agreed to. It’s not like the college is asking for them to pay for college after she died, she was going to college.</p>
<p>And I can’t get the CNN article about “but they only make this much money!!!”. To me, whoever let people who can’t afford the loan payments co-sign for someone who clearly could not make them on her own, was pretty much insane.</p>
<p>It comes down to “what right does someone have to buy something and then not want to pay for it if the result is not as they hoped?”. No right at all. Someone has to pay - and you and I end up paying for people like this who go outside their means, and then decide “it isn’t fair!” to pay what they owe.</p>
<p>How often does it occur that a student loan goes into default (or goes to the cosigner) because the student dies? If it’s rare, as I suspect it is, it would be pretty easy for lenders to insure against this themselves, with only a small increase in rates. If they did this, they wouldn’t need to exercise compassion, and they wouldn’t need to experience the bad press of chasing after grieving parents.</p>
<p>I am curious though - if the parents did not co-sign for her, if she had the loan clear and free, would the debt have become the children’s?</p>
<p>And could we have the insurance on the other side of it - mandate a small extra fee included in the loan when a co-signer clearly could not pay the loan off in the near future (lacking assets covering the full loan)? Like PMI for mortgages, if you put less than 20% down, they make you pay more money (when clearly you didn’t have enough for 20% down) until you get to the point of 20% down?</p>
<p>I don’t want to pay for insurance for co-signing my son’s college loan if I could pay it with no issue (yes, I understand that’s “right now” and things could change, and that I would have to mortgage my house up the wazoo), but these folks seem like they should not have co-signed in the first place and would have been great candidates for having to pay for “default insurance”.</p>
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No, but it would be paid from her estate, if there was anything in it.</p>
<p>A local story : <a href=“Redlands Family Owes $200K In Student Loans After Daughter's Death - CBS Los Angeles”>http://losangeles.cbslocal.com/2014/07/29/redlands-family-owes-200k-in-student-loans-after-daughters-death/</a> indicates that she had liver cancer, so very doubtful they would have been able to get life insurance. She got a temporary nursing license two months before her death.</p>
<p>I think it is <em>quite</em> disingenuous for articles to say “suddenly died of liver failure” when she had liver cancer. The implication is that she was “just fine” and “suddenly died”. It also sounds like they “assumed” the debt would be forgiven when she died.</p>
<p>I also wonder if they were allowed to co-sign because they run an independent church, which is essentially a small business with income and assets. But now don’t feel they are in a position to use that income and assets to help their situation.</p>