Friday, February 4, 2011

Sallie Mae, A Family Gal Who Cares

It's just too easy to pick on Ms. Mae and Mr. Nelnet!

I can't help myself when it comes to blasting them. It's possible that I could dedicate the rest of my writing career to unearthing all the terrible shit they do to people, and I could probably write about 1000 pieces a day. That would be the tip of the iceberg. Wouldn't that be fun?

This particular story, about Ms. Mae, made the debtor and me laugh.

Here's one way Sallie Mae shows her concern for families:

Hi, Cryn,

I had to share this with you . . .
 

I wrote a letter to Sallie Mae a couple of weeks ago, and stated that I was in desperate need [and asked them] to work with me, that my family was being torn apart because of their loans, and that I felt like my only options were them working with me, or offing myself [my emphasis].

Their response?

They sent me some life insurance forms for my family so that Sallie Mae could be paid if something happened to me.

I shit you not.
 

I kept it all because I was so amazed!
 

Just had to share it with you.
Thanks again for all of your efforts.



Well, at least their despicable antics can occasionally make us chuckle. Thanks, Ms. Mae. Thanks for caring. 


Related Links

Suicide and Murder-Suicides

Nelnet Offering Financial Literacy?

Our favorite gal, Sallie Mae

18 comments:

EvrenSeven said...

Joke's on Sallie Mae. Life insurance doesn't pay out in the event of suicide.

Anonymous said...

Please refer this over to www.consumerist.com. I think they would probably want to follow up on this and post it to their blog. I think Sallie Mae should be forced to answer to this!

Anonymous said...

Great post!!! :)
This should be sent all over the media!

C. Cryn Johannsen said...

(drum roll after good point).

JDpainterguy said...

Cryn:

I'm 46, and not getting any younger, and a question that I have is:

If I get a life insurance policy, then die a year later in a freak car accident or from some cause that is covered under the policy,

will the Student Lenders have priority, or be first in line for the payout?

For example, will Sallie Mae or Direct Loans jump in and claim all or a percentage of the payout?

If so, why bother to even buy Life Insurance?

Unfortunately, If I wanted an answer to this question from a well politically connected specialist lawyer, who knows the special nuances of the field, I'd have to pay his or her fee, which I can't afford.

So, life's a mystery, ain't it? (And I have a degree from Touro law School)

So just bury me in a potters field, or throw me to the sharks, better yet.

I just don't want to be a burden on my family.

Nando said...

Sallie Mae is a true toilet. I beat the hell out of the law $chool indu$try, but these loans originate with the banksters.

They KNOWINGLY provide large sums of money to students, because the banks will not be on the hook - in the event of a default or worse. They can sell the loans to a collection agency. In the worst-case scenario, the pigs can simply receive a bailout. What a great $y$tem, huh?!

Anonymous said...

It depends on your promissory note (PN). My PN (all federal loans) forgave my debt in event of my death. Review your PNs to determine for yourself.

Anonymous said...

JDPainterguy:

It depends on who is the owner of the insurance policy.

If you own the policy, then the proceeds of the policy when you die are part of your estate. Your creditors, including Aunt Sallie, get a crack at it.

On the other hand, if your spouse is the owner of a policy, and you are the insured, and she the beneficiary, then the proceeds of your death are not part of your estate and your creditors are SOL.

In some states (Missouri is an example), suicide is no defense to paying on a life insurance policy unless the insurance company can prove that the insured intended to commit suicide at the time he/she purchased the policy.

JDpainterguy said...

Thanks everyone:

It's just like I'm here with a 289K Mortgage that keeps growing 10 or 12K a year, and staring down the next 25 years, not knowing how it is all going to end.

There is no precedent, because as someone commented on this blog some time ago, no one has reached the end of that period and had their loan "Abated" yet, and then had to deal with the tax consequences and the IRS at the age of around 70.

I keep thinking: "What will I do?" What will I do?" "How will I live at that age? for surely some of my SS money will be grabbed.

A fluke windfall and/or a lottery ticket would clear it all up today.

There is no bankruptcy, so that is not an option.

So if my loan grows a couple hundred thousand dollars more over 20 years:

Who pays for that? The taxpayer? Does that make sense? Does the taxpayer want that?

Did the taxpayer want to cover the difference between 79K (my original Loan amount) and the 289K it is today?

And all of this taxpayer money I am speaking about--- is going into the pockets of private Collection Agencys and citizens like Al Lord and Fitzpatrick, and Private Co's like Sallie Mae and the others.

Correct me if I am wrong about all this.

Anonymous said...

After a policy (contract) paid to the designated beneficiary pursuant to that contract outside of the estate, under what therory can a creditor come back afterwards to claim the surrender value of the contract from the estate?

Anonymous said...

All I know is that I sure as hell am not going to buy a Life Insurance policy unless I know for sure that The Student Loan people are not going to grab the payout.

Anonymous said...

Student loans are forgiven in case of death bro the borrower. Similarly, if a parent takes out a parent loan and their child dies the loan is forgiven. The servider will need to document this by asking for a death certificate. These are federal regulations. Actually, about 95% of borrowers are sending their money to a federal lock box now, the US Treasury. This money does not go to Sallie Mae, unless it is a private, non Stafford loan. The federal government owns almost all loans now, sallie mae and others are contracted servicers on behalf of the government. (i am a financial aid officer at a community college). So get that life insurance policy. Now...how do you pick a credible life insurance company? Let me know what you find out.

C. Cryn Johannsen said...

@Anonymous 1:18 PM, you're providing inaccurate information about loan forgiveness. We need to be careful when discussing loans and loan forgiveness, because there are different types. Of course, FFELP loans are out, but you still have private loans, and that's an entirely different story, especially when it comes to loan forgiveness. You're not correct in stating that the Government owns almost all the loans. Why do you think so many people are suffering? It's because of the private loans they have, and the fact that those lenders are ruthless.

Anonymous said...

Cryn...you are correct. I was talking about FFELP and Direct loans. I thought that was the context of the question. You are so right private loans are a different animal. My comments have all been is the federal loan context. Thank you for clarifying. Take care!

C. Cryn Johannsen said...

@Anonymous 1:45 PM - no problem at all. Take care of yourself, too!

Lyndsey said...

I have a 200k life insurance policy because I have about 170k of student loans, 150k of which are PLUS loans in my mothers name that I pay, which DO NOT get discharged in the event of my death. However, it is accidental death and dismemberment only, so suicide isn't covered... So that's out. There is a case going through New Jersey right now about this, so that's something to watch - a tiny bone, but a start..

Anonymous said...

this is an absolute outrage, lead us cryn to a rally at the Sallie Mae headquarters, lets get some attention!!

C. Cryn Johannsen said...

It is an outrage. I agree. I'd be happy to organize a protest!