Wednesday, July 1, 2009

Bar Rejection Because of Excessive Student Loans

Student Loans The New York Times is reporting on someone rejected from the bar because of excessive student loans.  The story is complicated--involving tragic injuries, accusations of excessive fees, and his failure to make any payments--so you be the judge. 

My only thought is that more explanation is needed for the decision, which overruled a committee recommendation to approve him.  Decisions like this--whether justified or not--start raising questions about the propriety, or even legality, of letting bar associations restrict who can work as an attorney.


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It's Sallie Mae debt. Does that mean that if he defaults the taxpayers will be paying it off? If so, what a win-win-win for everyone! Guy who passed the bar doesn't get admitted, taxpayers get the bill, and presumably (if you read the story) a good guy lawyer can get a job waiting tables.

(And does the bar go after people they should be? *john yoo*)

Posted by: jerry | Jul 1, 2009 9:47:22 PM

Sounds like this person needs to get his act together! But, like you said, we need to know more of the story before we can pass judgement.

Posted by: Student Loan Source | Jul 2, 2009 5:08:21 AM

Sallie Mae went about defaulting on Bowman's loans long after they had been informed there were serious issues with their loan servicing. This letter was before any loans had ever been defaulted on, and apart from quoting comments from Sallie Mae agents who either threatened Bowman or just hung up the phone on him, it just asks for information, which they refuse to give (in a later letter they say they will "not address this issue any further" and then send all his loans into default.)

You would think that the guarantors (who are the channels by which taxpayer money goes to cover federal loans) would care. Here Bowman tries to get the guarantors to kick his loans back to Sallie Mae so he can deal with Sallie Mae directly. The guarantors never bother to address the issues; instead, they pick up the phone, call Sallie Mae, and ask them if anything was wrong on the account. They then write back to Bowman saying Sallie Mae did nothing wrong (because Sallie Mae said so). What did you think Sallie Mae would say? Here's the letter to the guarantors:

This has also been brought to NY Senator Schumer's attention (the Senator's office sent a letter to Sallie Mae's VP of Federal Relations); hopefully there will be some resolution. Bowman wrote back to Senator Schumer to say thank you and also attach lots of proof and documentation of Sallie Mae's accounting errors, refusal to disclose information, and misdeeds in general:

Really, this whole issue is about how Sallie Mae can readily cover up its mistakes and get away with it, and it's the borrower who takes the fall. The judges did something unusual, but this delinquency shouldn't have happened in the first place. Come on! Bowman had been asking for information from Sallie Mae since April 2007. He asked for repayment options, deferment options, and forbearance options. Sallie Mae didn't tell him how much deferment and repayment he had used and remaining until MAY 2009 (after they sent all his loans into default).

Posted by: truthmonger | Jul 2, 2009 9:41:12 AM

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