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Non Federal Student Loan - Are They Really Your Best Option?
Finance / Investing Author: Elisheva Wiriaatmadja
Non Federal Student Loan - Are They Really Your Best Option?
Non federal student loans seem to bring sweet sound to the ear for those who are looking for financing to further their education. Unfortunately very few people actually understand there are loan sharks working behind these loans, that they would just take up a loan without even any further research and comparing the market out there.
 
There is a better option to finance higher education. One of them is the federal student loan. However, a lot of students don't understand the difference between private student loans and federal loans, let alone grasp the advantage of having a federal loan.
 
Matters get worse as these students are unaware of the existence of so many complaints made by millions of borrowers regarding their student loan lenders and their practices to drain the blood out of their lives. This article is featuring a few emails sent by victims of private student loan companies for the public to see and be aware of the blood sucking practices that are enslaving the young generation of America.
 

Here is one of the letters of a young woman who has her student loan multiplied by the lender. She went to the Online Division of The Art Institute of Pittsburgh from July 2004 - March 2007. She took out a student private loan from Sallie Mae. Here is the email from her:

I went to The Art Institute of Pittsburgh (Online Division) from July 2004 - March 2007. I graduated from there with my Associates Degree in Graphic Design and to this day, I still have not found any work in my field due to the economy being so bad. I had to defer my student loans twice because I am a single woman struggling to make it on my own. I waitress and have a lot of expenses to pay for every month.
 
I originally took out a loan for $30,796.69 but after graduation I was told by Sallie Mae that it would be better to consolidate all of my student loans. But they never told me how much interest they were going to charge me.
 
After consolidating all of my loans and having to defer them due to economic hardship, the accrued interest to be capitalized is $1,020.66 making the total principal $31,817.35. Then the estimated amount of interest that they are charging me during repayment is $21,591.89. So the grand total that Sallie Mae says I owe them is $53,409.24!
 

Then I was approved for deferment and then they told me that I will be charged even more interest just for being in deferment. And also I still owe $366.44 to the college I went to and I still don't have my degree in my possession. They will not send it to me until the full balance is paid off. I am just trying to survive with the little money I am making right now.

One of my readers who would only like to be known as "Lyle took out a private student loan for bad credit and he sent me an email to explain to me what happened to him.

The student loan industry is legalized theft. I am paying on collection charges for a loan that was initiated in 1984. They have gotten their money plus interest long ago. They move the account from one Sallie Mae owned collection agency to another. Every time a new agency gets the account they add another collection fee. They have no conscience at all. They are blood suckers and will continue to be until we vote the incumbents out of office and get the laws changed. The current representatives will do nothing at all for their constituents. Congress is owned by corporate America and corporate America is no longer American. There was a time when fraud was illegal anywhere. It's now legal in the United States.
 
It might work, but I doubt it, if on one or two days every student with a loan wrote, called or e-mailed their representatives. One voice at a time does nothing. Thousands of messages complaining about this nonsense might, just might, get their attention.
 

Even the web sites purporting to be in opposition to this scam give nothing more than lip service to the issue.

Everyone is frightened by government. What they fail to realize is that we are the government. We need to stand up for our rights under God and the Constitution.
 
Sallie Mae takes money from my Social Security benefit every month with an "administrative garnishment. It is an unconstitutional method of collecting fictitious debts.
 

We must do something to stop this fraud!

Marta Stepanowicz originally applied for the best private student loans she could have ever found. However, without her knowledge her loans were sold to another lender which caused her a lot of trouble.

My name is Marta Stepanowicz and AES is making my life a living hell. My loans were originally taken out with a different lender and later were sold to AES without my knowledge.
 
These have the rudest and most incompetent people working there. I tried doing forbearance and have not consolidated with them (thank god) and they try making excuses and stories on how they would deny me every time. My income does not come close to alllowing me to make the $700 per month payment. I am very frustrated because I think that the FTC and Attorney General in Pennsylvania need to investigate them to the fullest extent. I found pages of stories filled with customers complaints about this monstrous company. I think all these complaints should be made public and I intend to do that with the FTC.
 

Knowledge is power and if I had known this about his company 7 years ago, then all of this could have been prevented. I am sure a lot of people going through this nightmare feel the same way. Everyone has to abide by rules and regulations and this company is no different.

Students may not understand the importance of exhausting all their other options first to finance their further education. These options include all free money that they do not have to repay ever, such as government grants or scholarships. They are better off staying away from any non federal student loans offered to them.

Total Views: 352 | Approx word count : 1029 | 08/31/2010





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