12.18.08 | Sallie Mae Heartless?
There is an article from the Boston Globe about a young soldier to be who died right before his tour in Iraq was set to begin. His name was Ian McVey. The article focused on his student loans that he left behind….he had both federal and private loans.
His federal loans were forgiven after his death…as all federal loans are, whether you are in the military or no
t. His private loans with Sallie Mae, will not be forgiven. Why? Because they are private loans, and it clearly states in the promissory note that the cosigner on the loan will be responsible for this loan if the primary borrower is not able to pay. Ian McVey’s parents wrote a letter to Sallie Mae, hoping that they would forgive their son’s 53k debt, so that they would not be burdened with that debt. No surprise that Sallie said no…but it was in the way they said no that has me heated. (again, not surprised)…
Ian’s dad took the time to write a very personal and heartfelt letter to Sallie Mae. Stamped it, sent it off, and waited for a reply. Sallie Mae sent back a computer generated letter, with no name on it, stating that the loans would not be forgiven and he owed them 53k. You would think with all the bad press Sallie has gotten in the last year they would TRY to clean up their act??? Shouldn’t they have at least one person in their monstrous corporation that can write these letters, and be a contact for these families that are grieving….and burdened financially? I am not saying that Sallie should forgive those loans…because legally they do not have to…but why didn’t one person take the time to answer this Dad? What do you think?
Read the article here.
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The article was very poorly written and leaves out numerous details. For example, the loan was likely cosigned by the parent. No mention of this. Second, as a serviceman, Ian had government provided life insurance (some say approx $200K), which would have been paid to his parents. No mention of this. Third, he was killed while riding his motorcycle by an elderly driver. That driver (and her insurance company) would have been financially liable for causing his death. There was no mention of this either.
It is likely that there were numerous sources of funding to cover any debts after Ian’s death. His parents should tap those sources before they start asking a for a handout.
December 18th, 2008 | #
I don’t like their response, but I understand it. Private student loan companies include terms in their master promissory notes that federal loans do not. Many of these terms are designed to prevent borrowers from taking them to court. If a representative from a loan company answered a borrower personally, they might unintentionally void some of the terms designed to protect the company from lawsuits.
December 19th, 2008 | #
just a follow up, after the bad press, Sallie agreed to forgive the loans…and an executive there said that letter was a mistake and should not have been sent out.
January 23rd, 2009 | #