Banks screwing students the way they screwed homeowners

<span style="font-family: inherit;">Once again, family finances are in danger from big banks.  Thousands of students with loans are complaining their student loan companies are breaking laws in the same way mortgage servicers did during the foreclosure crisis. That's according to a newly released <a href="http://www.consumerfinance.gov/" rel="nofollow">Consumer Financial Protection Bureau</a> (CFPB) report that <a href="http://files.consumerfinance.gov/f/201310_cfpb_student-loan-ombudsman-annual-report.pdf" rel="nofollow">warns of increased fees and financial trouble to come</a>:</span><br /><blockquote class="tr_bq"><span style="font-family: inherit;">Many of the private student loan complaints mirror the problems heard from consumers in the mortgage market following the wake of the financial crisis.</span></blockquote>In the past year, CFPB received 3,800 complaints from student loan borrowers. Eight servicing companies received 87 percent of the complaints, including <a href="http://www.huffingtonpost.com/2013/08/08/sallie-mae-education-military_n_3729092.html" rel="nofollow">Sallie Mae</a>, <a href="http://seekingalpha.com/article/1767202-wall-street-breakfast-must-know-news?source=google_news" rel="nofollow">Wells Fargo</a>, <a href="http://www.cnbc.com/id/101075961" rel="nofollow">Citi</a> and <a href="http://www.theatlanticwire.com/politics/2013/10/next-13-billion-fine-doj-investigating-9-more-banks/70908/" rel="nofollow">JPMorgan Chase</a>.<br /><span style="font-family: inherit;"><br /></span><span style="font-family: inherit;">Lenders pay other companies, called servicers, to process loans.  These subcontractors make the least money when people pay back the loan on time -- and the most when people are struggling, since the subcontractors keep all of the late fees for themselves.</span><br /><span style="font-family: inherit;"><br /></span><span style="font-family: inherit;">CFPB's report suggests a pattern of lawbreaking by student loan servicers. And why not? Wall Street saw how profitable foreclosing on families was.  Although millions of Americans lost their homes due to criminal behavior, banks were just handed tax-deductible fines and banned from messing with the housing market like that again.  But the student loan market remained open -- and  too-big-to-fail banks knew they could get away with it again.</span><br /><span style="font-family: inherit;"><br /></span><span style="font-family: inherit;">As David Dayen points out in <a href="http://www.salon.com/2013/10/23/paging_elizabeth_warren_student_loan_providers_are_likely_screwing_you_over/" rel="nofollow">Salon</a>: </span><br /><blockquote class="tr_bq">the past performance of regulators on mortgage servicing has been pretty toothless. And that’s why student loan servicers believe they have a license to steal.</blockquote>Here's what the student loan services are up to, according to the CFPB report: <br /><ul><li><span style="font-family: inherit;">Violating the Truth in Lending Act by charging student lenders fees for prepaying their private student loans. </span></li><li><span style="font-family: inherit;">Forcing military borrowers -- including those in combat zones -- to resubmit unnecessary paperwork and then charging higher interest rates when they can't come up with the paperwork.</span></li><li><span style="font-family: inherit;">Making it too complicated and difficult for<a href="http://www.salon.com/2013/10/23/paging_elizabeth_warren_student_loan_providers_are_likely_screwing_you_over/" rel="nofollow"> most struggling graduates to refinance their loans</a>.</span></li></ul><span style="font-family: inherit;">It's no surprise <a href="http://www2.ed.gov/offices/OSFAP/defaultmanagement/cdr.html" rel="nofollow">over 14 percent of 2010 graduates defaulted on their loans within three years</a>. Without reform and actual enforcement of lending laws, the default rate is only going to rise.  We just wonder why this is still legal.</span>

mortgage abuse mortgage fraud old dogs and new tricks student debt student loans Banks screwing students the way they screwed homeowners

Once again, family finances are in danger from big banks.  Thousands of students with loans are complaining their student loan companies are...

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Why young workers love unions so much

The Pew Research Center came out with a new poll showing <a href="http://www.people-press.org/2013/06/27/favorable-views-of-business-labor-rebound/">that a majority of people have a favorable view of labor unions</a> -- 10 percent more than two years ago, the last time that Pew asked the question.  And over 60 percent of adults younger than 30 support unions – even if <a href="http://www.bls.gov/news.release/pdf/union2.pdf">fewer than 5 percent of them actually are unionized</a>.  So why is there so much support?<br /><br />Younger workers are increasingly introduced to a crappy economy with no safety net.  After the housing crisis, <a href="http://www.salon.com/2013/06/29/the_capital_of_exploitation_temp_town_usa_partner/">it has become harder and harder to find a full-time position</a>, since companies can get away with treating workers badly.<br /><br />Median pay has declined for workers, while corporate CEOs earn vast sums. Not only is America more unequal than ever, but <a href="http://thecontributor.com/daily-ceo-pay-now-exceeds-us-workers-annual-salary">the average CEO makes more in a day than an average worker makes in a year. <br /><br />Even college, the traditional step for the ambitious young, is no longer the step up it once was.  Only </a><a href="http://money.cnn.com/2011/11/21/news/economy/income_college/index.htm">nine percent of low-income students can afford to even finish college</a>, a gap that has increased 50 percent in the past 20 years.  And unaffordable student debt looms over all who dare strive for higher education.<br /><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjiE8fY01_P5jJxR0x8WnGK7OnNH3vgTAxzrwyDPIFCyJR3c0dxtuGuvmXi5b_ptFfwyxWLEa-AAWKrXojNlWWhhhebSfB_WoSEqKOB4cRjeDkmXn_jCGW598v-x0D4rIRtG08wwL5C8hAK/s1600/i+heart+young+workers.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="91" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjiE8fY01_P5jJxR0x8WnGK7OnNH3vgTAxzrwyDPIFCyJR3c0dxtuGuvmXi5b_ptFfwyxWLEa-AAWKrXojNlWWhhhebSfB_WoSEqKOB4cRjeDkmXn_jCGW598v-x0D4rIRtG08wwL5C8hAK/s320/i+heart+young+workers.jpg" width="320" /></a><a href="http://blogs.wsj.com/economics/2013/03/30/number-of-the-week-college-grads-in-minimum-wage-jobs/">Over 280,000 college graduates work in minimum wage jobs</a>, qualifying them for government assistance and an overwhelming sense of depression.  In 2010, <a href="http://centerforcollegeaffordability.org/research/studies/underemployment-of-college-graduates">15 percent of taxi drivers had bachelor degrees</a>.  And they are the lucky ones; <a href="http://www.businessweek.com/careers/managementiq/archives/2009/05/intern_abuse.html">permainterns</a>, with unpaid positions abound.  <a href="http://www.nber.org/papers/w18901">Little evidence has been offered that this new status quo is going to suddenly change</a> if the economy ever turns around. <br /><br />From Occupy Oakland to Moral Mondays, workers have protested for a better economic and political system, but changes to government are long and arduous.  On the other hand, labor protests are typically short and to the point.  Contract negotiations, strikes, and other labor tactics get people better working conditions and decent jobs time after time.  In 2012, <a href="http://www.bls.gov/news.release/union2.nr0.htm">full-time union members made over $200 more than non-union full-time workers. </a><br /><br />With those kinds of benefits, who <i>wouldn't</i> want to be part of a union?

inequality student debt unions Why young workers love unions so much

The Pew Research Center came out with a new poll showing that a majority of people have a favorable view of labor unions -- 10 percent more...

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