Higher Education Insanity -- 8th Circuit Court rules that a poor guy can't discharge $350,000 student loan debt.

[WhipperSnapper]

As more evidence of the continuing madness of this nation's higher education policies, the 8th Circuit Court of Appeals overturned a Bankruptcy Court ruling and a District Court ruling (on appeal from the bankruptcy court) allowing a guy who couldn't find work in his field (law) to discharge $350,000 in student loan debt. Basically, this man has been condemned to poverty for life and a debtors' prison without walls.

This ruling is consistent with our nation's ridiculous policy of subsidizing, encouraging, and producing huge oversupplies of college graduates, which constitutes a tremendous amount of economic waste. It also helps to demonstrate the damage that this economic waste does to people. This guy never should have been allowed to accumulate so much debt with so little possibility of ever being able to repay it. Also, our nation's overproduction of college graduates makes it difficult for a great many of those graduates to find jobs in their fields that would allow them to repay their student loans. Sadly, these people who tried to follow the dogma of the value of education that has been rammed down everyone's throats can't even discharge their debts in bankruptcy.

So, by obtaining higher education and failing to find a position in his field, a man has been condemned to a debtors' prison without walls for life. In the meantime, the University of New Hampshire wants to open up a new law school even though the nation already has twice as many law schools as it needs.

Student must repay $350,000, court says

 

[Acanthus]

The debt seems high unless he was going to a premiere school. If he was attending a premiere school he should have no trouble finding work... as a lawyer... in the United States.

 

[mugs]

Yeah, this guy is just a victim of his circumstances, right?

Struggles with alcohol brought him in and out of college; it took 11 years to complete his undergraduate degree.

His problem is that he took too long to give up.

The lenders and courts pointed out that Jesperson hadn't made a single voluntary payment toward his student loans. That's true, Jesperson said.

"I'm just like everyone else on the planet," he said. "I've been surviving. Housing and food and diapers."

The ruling stated that Jesperson should have taken advantage of a program that would have allowed him to make payments based on his income and family's poverty level -- regardless of his total unpaid student debt. Lenders argued that if Jesperson had used the program, his loan payments would have equaled no more than $629 per month.

If, after 25 years, he had not repaid the debt, the unpaid portion would be forgiven

 

[WhipperSnapper]

Originally posted by: Acanthus
The debt seems high unless he was going to a premiere school. If he was attending a premiere school he should have no trouble finding work... as a lawyer... in the United States.

Even at a Top Ten law school, you still need to graduate in the top 60% of the class to get a job at a large or a medium-sized law firm, especially today. (Earlier I read an anecdote on another forum about how even the students at the top of the class at the top schools are having a rough time now.) It's also possible to graduate from a Top Ten school with decent grades but questionable people skills and then fail your job interviews even though you have the ability to do a great job.

 

[WhipperSnapper]

Originally posted by: mugs
Yeah, this guy is just a victim of his circumstances, right?

Struggles with alcohol brought him in and out of college; it took 11 years to complete his undergraduate degree.

His problem is that he took too long to give up.

It sounds like he definitely hurt himself. However, he never should have been allowed to get into that position in the first place and even then it shouldn't have been so difficult for him to find a lawyer job. It's quite possible that he had sobered up and just couldn't find a job after passing the Bar Exam on the first try.

If student loan debt were treated like other debts that can be discharged in bankruptcy, we'd have less irresponsible lending and quite possibly a decrease in the overproduction of college graduates (which would make it easier for borrowers to repay their loans).

 

[her209]

Isn't this pretty typical for law school graduates?

 

[senseamp]

I dunno, sounds like he's just trying to weasel out of paying his loans just because it didn't work out for him.

 

[CycloWizard]

Originally posted by: WhipperSnapper
It sounds like he definitely hurt himself. However, he never should have been allowed to get into that position in the first place and even then it shouldn't have been so difficult for him to find a lawyer job. It's quite possible that he had sobered up and just couldn't find a job after passing the Bar Exam on the first try.

He got himself into this situation. Why is it the government's job to protect him from his own decision? I'm sick and tired of the appeals to emotion by those who feel student loan debt is a burden that people had to take on. It's a choice - one that I made and am now burdened with, albeit only at 25% of the level of this guy. I'm now living very modestly and paying $1k a month towards my loans. I made my bed, now I get to lie in it. Why shouldn't I?

If student loan debt were treated like other debts that can be discharged in bankruptcy, we'd have less irresponsible lending and quite possibly a decrease in the overproduction of college graduates (which would make it easier for borrowers to repay their loans).

Always blame the corporations who are doing their job rather than the people who are overextending themselves. Why is the individual less culpable?

 

[xj0hnx]

I can see this being a case of trying to clear out some financial overhead before taking advantage of a over 1/4 of million dollar education. Seriously, 11 years, in and out, all the while accumulating a gargantuan debt, the dude didn't think maybe he should stop while he's behind? No wonder he can't find a job.

 

[Blackjack200]

Originally posted by: CycloWizard

Originally posted by: WhipperSnapper
It sounds like he definitely hurt himself. However, he never should have been allowed to get into that position in the first place and even then it shouldn't have been so difficult for him to find a lawyer job. It's quite possible that he had sobered up and just couldn't find a job after passing the Bar Exam on the first try.

He got himself into this situation. Why is it the government's job to protect him from his own decision? I'm sick and tired of the appeals to emotion by those who feel student loan debt is a burden that people had to take on. It's a choice - one that I made and am now burdened with, albeit only at 25% of the level of this guy. I'm now living very modestly and paying $1k a month towards my loans. I made my bed, now I get to lie in it. Why shouldn't I?

If student loan debt were treated like other debts that can be discharged in bankruptcy, we'd have less irresponsible lending and quite possibly a decrease in the overproduction of college graduates (which would make it easier for borrowers to repay their loans).

Always blame the corporations who are doing their job rather than the people who are overextending themselves. Why is the individual less culpable?

Why should student loan debt be treated any differently from other unsecured debt? It's the lenders decision to take the risk of making the loan, and if the risk turns out badly, they should not be able to destroy the guys life to draw every nickel they can. If the Government and other lending institutions were actually forced to realize losses on these rediculous loans you'd have a much lower rate of college enrollment, with a resulting reduction in tuition costs and a reduced requirement for bachelors degrees in entry level jobs.

My first job out of college could have easily been done by a competent high school graduate, but since there are so many 4 year degrees out there, might as well require it.

 

[First]

Originally posted by: her209
Isn't this pretty typical for law school graduates?

Yes. The OP lives in an alternative reality.

 

[Dr. Zaus]

I was of the impression that 120k was the limit to federally subsidized+unsub student loan debt.

Can't you escape this debt by going to another country?

Also, 25 years at 700 a month is a good deal to pay off 350k.

Why should student loan debt be treated any differently from other unsecured debt? It's the lenders decision to take the risk of making the loan

They take the risk understanding that the loan is non-bankrupt-able.

If they knew it to be bankrupt-able then they would have charged more to cover the risk of bankruptcy.

Bottom-level collages are desperate for lawyers to teach business law and tax-accounting.

It's not that he couldn't get a job, it's that he couldn't get a job where he wanted to live.. and no one has a right to live somewhere they can't afford.

 

[Phokus]

being a lawyer is a really bad idea these days. Total oversupply and the debt is insane.

 

[AreaCode707]

Originally posted by: Phokus
being a lawyer is a really bad idea these days. Total oversupply and the debt is insane.

I work in a corporate legal department and we've got new attorneys working as legal assistants right now. Bit of a shame really, especially since some of them are better people than the "official" attorneys we've hired.

 

[ProfJohn]

Originally posted by: WhipperSnapper
If student loan debt were treated like other debts that can be discharged in bankruptcy, we'd have less irresponsible lending and quite possibly a decrease in the overproduction of college graduates (which would make it easier for borrowers to repay their loans).

If student loans were treated like other debt the cost of school loans would go sky high and thus millions of people who do pay off their loans would suffer because of a few people who don't.

 

[ProfJohn]

Look up the court ruling
http://www.ca8.uscourts.gov/opns/opFrame.html

The guy is a loser who thought he could make his debt just disappear.
From the trial:

Q It?s true, Mr. Jesperson, that you think this debt should just go
away, isn?t that true:
A Yes.
Q And even if you had, Mr. Jesperson, an extra $500 per month, you
don?t think you should have to put that towards your student loans, do
you?
A No.

The guy doesn't pay his child support either, $500 a month.

He makes $4000 a month, lives with his brother rent free and doesn't make his child support payments.

If all you do is look at his total debt you might feel sorry for him, but when you read on you lose that feeling.

BTW the guy had multiple jobs as a layer and quit every one of them.

 

[cubby1223]

^^^
Stop being rational!

That's not allowed inside AT P&N, the best way to live life is on knee-jerk reactions.

 

[Dr. Zaus]

He makes $4000 a month, lives with his brother rent free and doesn't make his child support payments.

wow... 48k take home is about 68k a year... that is fairly above the national average.

My family made, in today's terms, 18k a year and we had 5 kids;

we made it on 1500 a month, I'm sure this guy can to... how this is "debtor's prison" I surely don't follow.

 

[rchiu]

Originally posted by: WhipperSnapper
As more evidence of the continuing madness of this nation's higher education policies, the 8th Circuit Court of Appeals overturned a Bankruptcy Court ruling and a District Court ruling (on appeal from the bankruptcy court) allowing a guy who couldn't find work in his field (law) to discharge $350,000 in student loan debt. Basically, this man has been condemned to poverty for life and a debtors' prison without walls.

This ruling is consistent with our nation's ridiculous policy of subsidizing, encouraging, and producing huge oversupplies of college graduates, which constitutes a tremendous amount of economic waste. It also helps to demonstrate the damage that this economic waste does to people. This guy never should have been allowed to accumulate so much debt with so little possibility of ever being able to repay it. Also, our nation's overproduction of college graduates makes it difficult for a great many of those graduates to find jobs in their fields that would allow them to repay their student loans. Sadly, these people who tried to follow the dogma of the value of education that has been rammed down everyone's throats can't even discharge their debts in bankruptcy.

So, by obtaining higher education and failing to find a position in his field, a man has been condemned to a debtors' prison without walls for life. In the meantime, the University of New Hampshire wants to open up a new law school even though the nation already has twice as many law schools as it needs.

Student must repay $350,000, court says

The system encourage...the system produce over supply...blah blah blah. What about freaking personal responsibility? What about not being stupid and knowing taking out 350k loan is a risky deal if you don't know you will get a job with the degree you are seeking.

and good job using one guy with drinking problem to show that there is a huge oversupply of graduates and constitutes a tremendous amount of waste. This study shows that people with Doctoral/Profession degrees make $1370+/wk where people with high school degree but no college make $583/wk. Yeap, that shows an over supply of people with educations and it's a waste to go for good educations.

 

[Via]

Why isn't anyone mad at the folks who lent this doorknob $350,000?

 

[JKing106]

Because that would make sense, and it's never, ever the lender's fault. American Greed 101.

 

[Dr. Zaus]

The lender lent to a guy who CAN pay back... I don't see the problem.

sure he would have to live the lifestyle of an average American, but you'll get no sympathy out of me on that one. He sure did live off of that 350k while he was screwing around in school.

 

[CPA]

Originally posted by: Via
Why isn't anyone mad at the folks who lent this doorknob $350,000?

The same reason I don't get mad at gun manufacturers for crimes committed using a gun.

 

[dmcowen674]

Originally posted by: WhipperSnapper
As more evidence of the continuing madness of this nation's higher education policies, the 8th Circuit Court of Appeals overturned a Bankruptcy Court ruling and a District Court ruling (on appeal from the bankruptcy court) allowing a guy who couldn't find work in his field (law) to discharge $350,000 in student loan debt. Basically, this man has been condemned to poverty for life and a debtors' prison without walls.

This ruling is consistent with our nation's ridiculous policy of subsidizing, encouraging, and producing huge oversupplies of college graduates, which constitutes a tremendous amount of economic waste. It also helps to demonstrate the damage that this economic waste does to people. This guy never should have been allowed to accumulate so much debt with so little possibility of ever being able to repay it. Also, our nation's overproduction of college graduates makes it difficult for a great many of those graduates to find jobs in their fields that would allow them to repay their student loans. Sadly, these people who tried to follow the dogma of the value of education that has been rammed down everyone's throats can't even discharge their debts in bankruptcy.

So, by obtaining higher education and failing to find a position in his field, a man has been condemned to a debtors' prison without walls for life. In the meantime, the University of New Hampshire wants to open up a new law school even though the nation already has twice as many law schools as it needs.

Student must repay $350,000, court says

404 Debtors prison not found

 

[Dr. Zaus]

Originally posted by: dmcowen674

Originally posted by: WhipperSnapper
As more evidence of the continuing madness of this nation's higher education policies, the 8th Circuit Court of Appeals overturned a Bankruptcy Court ruling and a District Court ruling (on appeal from the bankruptcy court) allowing a guy who couldn't find work in his field (law) to discharge $350,000 in student loan debt. Basically, this man has been condemned to poverty for life and a debtors' prison without walls.

This ruling is consistent with our nation's ridiculous policy of subsidizing, encouraging, and producing huge oversupplies of college graduates, which constitutes a tremendous amount of economic waste. It also helps to demonstrate the damage that this economic waste does to people. This guy never should have been allowed to accumulate so much debt with so little possibility of ever being able to repay it. Also, our nation's overproduction of college graduates makes it difficult for a great many of those graduates to find jobs in their fields that would allow them to repay their student loans. Sadly, these people who tried to follow the dogma of the value of education that has been rammed down everyone's throats can't even discharge their debts in bankruptcy.

So, by obtaining higher education and failing to find a position in his field, a man has been condemned to a debtors' prison without walls for life. In the meantime, the University of New Hampshire wants to open up a new law school even though the nation already has twice as many law schools as it needs.

Student must repay $350,000, court says

404 Debtors prison not found

It is a metaphor sr. and an accurate one.. debt is dumb, it inevitably enslaves you.