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The Facts Behind That $5 Billion in 'Forgiven' Student Loan Debt

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The New York Times created a considerable stir on July 17 by detailing a widespread student loan repayment crisis. According to the paper, one of the largest holders of private loans, National Collegiate Student Loan Trusts, has been struggling to provide documentation that proves it owns the $5 billion in delinquent accounts that it’s been attempting to collect. Without that paperwork, dozens of lawsuits brought against defaulting borrowers are being dismissed.

A lack of a paper trail is never a good thing for the plaintiff in attempting to collect a debt. But it’s not exactly great news for the borrower, either. 

Here’s why: First, it’s helpful to understand how a typical chain of custody works for private student loans. (Federal loans, which typically have more forgiving terms, are a separate issue entirely.) Banks and other lenders offer loans to applicants, then turn around and sell bundles of those loans to a depositor. That depositor will offer the loans to an umbrella organization like National Collegiate, which is comprised of 15 private trusts holding the paper on more than 800,000 loans.

This lengthy chain of custody is where the problems begin. Because loans pass through several hands, it’s not always clear who has retained the documentation needed by courts to prove that National Collegiate is the owner of the debt they’re attempting to collect from a borrower in default. As a result, judges tasked with these cases often have no choice but to dismiss them.

That’s led to a series of headlines about $5 billion in “forgiven” debt, which may sound comforting to someone burdened with a towering student loan at exorbitant interest rates. However, as several attorneys speaking to the media have pointed out, it’s not that simple. The cases that have been dismissed were in court because the borrower was already in default. In situations where National Collegiate can prove ownership of the debt, those debtors are facing wage garnishment and a negative impact on their credit score. Simply defaulting on a loan and hoping you happen to be one of the people whose paperwork is incomplete is a dangerous form of wishful thinking.

In the event you had no choice but to default and might benefit from National Collegiate's poor record-keeping, you may not walk away unscathed. According to debt relief attorney Daniel Gamez, a student borrower who sees his or her case dismissed is not facing a clean slate. National Collegiate is fighting so many defaulted loans that they may choose to drop cases based on logistical issues like witness scheduling. Still, even if the lawsuit is dropped, National Collegiate may have the option to refile it at a later date—this time armed with the documentation and resources they need. And any debt, even if it’s been declared unenforceable, may still affect your credit score.

Ultimately, whether or not National Collegiate can produce paperwork doesn’t change the fact that a borrower has a student loan that they’ve agreed to repay. As a creditor, National Collegiate is likely to take every legal measure available in order to collect on that debt. While those amounts may be “forgiven” in court, they’re not likely to be forgotten.

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Interactive Chart Tells You How Long It Takes to Get Frostbite
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For many people, winter means dry skin and high heating bills. But if you find yourself outdoors in the right conditions, it can also mean frostbite. Frostbite occurs when the skin and the tissue beneath it freezes, causing pain, loss of sensation, or worse. It's easier to contract than you may think, even if you don't live in the Siberian tundra. To see if frostbite poses a threat where you live, check out this chart spotted by Digg.

The chart, developed by Pooja Gandhi and Adam Crahen using National Weather Service data, looks at three factors: wind speed, air temperature, and time spent outdoors. You can hover your cursor over data-points on the table to see how long you'd need to be exposed to certain wind chills for your skin tissue to freeze. If the wind chill is -22°F, for example (10°F air temperature with 5 mph winds), it would take 31 minutes of being outside before frostbite sets in. You can also look at the time scale above the chart to calculate it a different way. If you bring your cursor to the 40-minute mark, a window will tell that frostbite becomes a risk after exposure to -17°F wind chill for that amount of time. You can play with the interactive table at Tableau Public.

Chart of cold weather conditions.
Adam Crahen, Pooja Gandhi

If you can't avoid being outside in extreme wind and cold, there are a few steps you can take to keep your skin protected. Wear lots of layers, including multiple socks, and wrap your face with a scarf or face mask before venturing into the cold. Also, remember to stay hydrated. According to the American Academy of Dermatology, drinking at least one glass of water before going outside decreases your risk of contracting frostbite.

[h/t Digg]

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Flurry Road: 5 Tips for Safe Driving on Winter Roads
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For drivers in the Upper Midwest, traveling during the winter can range from slightly unsettling to deadly. Between 2011 and 2015, according to data from the National Highway Traffic Safety Administration and the Auto Insurance Center, an average of 800 fatalities occurred annually as a result of weather-related accidents. Icy roads, poor visibility, and other factors can make cold-weather commuting a dicey proposition.

While we can’t control the weather (yet), we can increase our odds of navigating slush-filled roadways successfully. Mental Floss spoke with American Automobile Association (AAA) driving education expert William Van Tassel, Ph.D., for some key tips on how to get your winter driving in gear.

1. GATHER SUPPLIES.

Before you even start your car up for a trip through inclement weather, Van Tassel recommends you pack a worst-case scenario trunk full of supplies. “In case of emergency, you want things on board like water, a blanket, a flashlight, gloves, and kitty litter,” he says. (That last one is for traction in case you get stuck in a snowbank.) You should also have road flares, a shovel, an ice scraper, and a fully-charged cell phone to call for assistance if needed.

2. SLOW DOWN.

Posted speed limit signs assume you’re driving on clear and clean roadways. If snow or ice has accumulated, you need to adjust your speed accordingly. “In slick conditions, tires lose a lot of traction,” Van Tassel says. “You should be cutting your speed down by half or more.” Unfortunately, a lot of people learn this the hard way. “After a snowstorm, we’ll see more crashes on day one than days two or three.”

Van Tassel also cautions to avoid becoming overconfident on snow tires. While they provide better traction in bad weather, it’s not license to speed up.

3. MAINTAIN A SAFE DISTANCE FROM OTHER CARS.

You should be doing this regardless, but bad weather makes it even more crucial. Keep your vehicle at a safe distance from cars behind, in front, and off to the sides, as well as away from pedestrians or cyclists. If you need to brake suddenly, you need time—and space—to avoid a collision. “You really want more space in front,” Van Tassel says. Try to stay between seven and 10 seconds behind the vehicle ahead. That means seeing a landmark and then counting down until you pass the same marker. If you’re only a few seconds behind, you’re too close.

4. DON’T STEER INTO SKIDS.

“That was an old rule of thumb,” Van Tassel says. “The problem is, by the time I remember to steer into a skid, I’m already in a ditch.” If you feel your vehicle sliding, it’s better to steer in the direction you want to go. “You’ll drive where you look, so don’t look at a telephone pole.”

To help maintain control of the car, you want to focus on doing one thing at a time. “If you’re going through a turn, brake, finish braking, then turn. Don’t brake and turn at the same time.”

5. KEEP YOUR HEADLIGHTS ON.

Yep, even in broad daylight. Bad weather limits visibility, and headlights allow both you and your fellow drivers to orient a vehicle. “You’re twice as visible to other drivers that way,” Van Tassel says. “When people can see you, they can avoid you.”

Van Tassel also recommends that drivers avoid relying on fancy car technology to keep them safe. While blind spot monitoring and lane changing sensors are useful, they’re not there so you can zone out. “The tech is there to back you up if you need it. Drive the car, but don’t rely on those things,” he says.

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