Student loans are presumably a good thing: you take a loan, get an education you want and use the newly acquired qualifications to earn money in order to repay it. However, the representatives of “the Corinthian 15” like Mallory Heiney think differently. For them student loans turned into a veritable debt trap.
Ms. Heiney was a student at now-defunct Everest College, belonging to the Corinthian College system. According to Business Insider, until 2014, Corinthian, Inc. was one of the most prominent college companies in the United States.
“Prior to 2014, Corinthian Colleges Inc. was a network of more than 100 schools and one of the largest for-profit college companies in the US. But numerous investigations and lawsuits alleging wrongdoing against the company rapidly decreased its size. In July 2014, an agreement with the US Department of Education (DOE) forced Corinthian to sell 85 of its schools and close another 12.”
This decision, however, left their students in a rather precarious position. Colleges they attended no longer exist and they cannot complete their education – yet the Corinthian, Inc. is still determined to collect their loans.
In addition to that the quality of education they received while it lasted, according to Ms. Heiney, was subpar – teachers did little more than simply read aloud from textbooks. Now she and other members of the Corinthian 15 believe that their decision to default on their payments is as just as Rosa Parks’ refusal to give up her seat in a bus – and they hope it will bring about the same amount of change.
The student loan situation in the United States seems to be rapidly spiraling out of control, and, according to the Inquisitr, some experts believe it may become a cause for a new crisis that potentially can destroy American colleges and lead to new full-fledged financial crisis.
“The overall consumer price index has risen 115 percent since 1985 while the college education inflation rate has risen nearly 500 percent. But, unlike credit card debt, student debt is not forgivable in bankruptcy.”
By now, the student debt in the United States reached a disturbing mark of $1.2 trillion – higher than overall mortgage debt, which recently served as a cause for financial recession in and of itself.
Obama’s administration promises to do something about student loans and the cost of education, but so far the results were middling at best, and a lot of people believe that their intervention may be worse than the problem itself.