Grieving parents hit with $200,000 in student loans

[magical thyme]

42. understand where you are coming from, however I challenge some of the assumptions

For example, homeowner loans don't get forgiven. They get re-written, or they negotiate a short sale (and the forgiven portion is taxable income, plus the homeowner loses their entire down payment) or the home is foreclosed on. The re-written loan allows the homeowner to continue making payments and stay in his/her home, which contributes to a more stable society. Foreclosures end up costing as much, if not more, but the costs are hidden. For example, having a foreclosure in your neighborhood lowers the property values of the entire neighborhood. That is a cost to everybody. Having empty houses falling apart invites crime and wastes valuable resources. Throwing people out of their homes can cost them jobs, damages their children's education and stability, and ultimately costs society more then re-writing the terms of the loan.

It is no different than bankrupcty of a business; the losses are shared so nobody ends up totally ruined and to contain the losses rather than making things worse.

In the situation cited in the OP, it's hard to feel real sorry for the parents. You can go to nursing school for a lot less than $100K, she should have taken out FAFSA loans, with a lower interest rate, and certainly the parents should have been able to do the math.

Still, the cost of educating their daughter was a lot less than the $100K the school charged and the interest rates are usury and should be illegal. And the parents should at the least have been able to immediatere-negotiate the interest rate and payments down to something affordable.

The entire system does need to be fixed. There is so much massive corruption from top to bottom that anybody can start out doing things right and still end up losing everything.

Punishing people and ruining them financially and ultimately ruining their lives because of mistakes and unforeseen circumstances does not help the situation in the long run.

I know whereof I speak. I did my homework, I did the math, for my recent MLT degree. What I could not foresee was that the government statistics of 14% growth were a flat out lie. What I could not foresee was that HR at the local hospital would flat out lie to both me and a classmate about the starting salary. What I could not foresee was the state university's claim of 100% employment for its graduates was a lie by omission. Twice in the last 4 years I was driven to the brink of suicide by the stress and ruin brought on me. And guess what: that would not pay the loans back either.