Top College News Subscribe to the Newsletter

Moms start petition on after being forced to pay student loans of murdered sons

Senior Reporter

Published: Tuesday, February 12, 2013

Updated: Tuesday, February 12, 2013 01:02

Angela Smith, mother of Donte Newsome, was left with her sons debt from a private school loan after he was murdered.

Many students have private student loans, but what happens when you die and the loan isn’t paid off?

According to William Winters, a senior campaigner for, the petition involves what happens to student debt after death.

“If the student, or primary borrower, on a private loan dies before the loan can be paid off, the loan automatically defaults to the guarantor,” Winters said. “The petition on is specifically focused on the First Marblehead Corporation, and uses the cases of Angie Smith and Ella Edwards as examples of what happens when a student dies.”

Both Edwards and Smith had children who took out private student loans and then died before they could pay them in full. Unlike federal student loans private loans are not dismissed and the remaining payments automatically default to the guarantor, in this case, Smith and Edwards.

One of the more upsetting factors for both Smith and Edwards was that they had no idea the payments would default to them, due to lack of communication by their banks when they signed the papers. The women found it even more disturbing when each bank failed to tell them how the private loan process worked and were not aware that their loans changed hands several times until they received the first call from First Marblehead demanding payment.

“Dealing with the news of my son’s murder was horrifying enough without being harassed by a company I’d never heard of multiple times a day,” Smith said. “We asked every question we could think of when taking out the loan, but we didn’t think to ask what happens in case of death, and First Marblehead didn’t tell.”

Marian Wang, a reporter with ProPublica, who has been following the story since it began, said the troubles continued.

“Private loans change hands, because people are making an investment,” Wang said. “To forgive the loans, those investors lose a lot of money, something the majority of them refuse to consider. The parents then end up in debt because they are told there is no way out of paying the loans.”

Wang then went on to say that bankruptcy was an option in getting the loans discharged, but is seldom used since people are being told there is no possible way of getting their loans discharged. Wang also recommended checking the original paperwork if a person finds them self in that situation, because there can often be mistakes somewhere along the paper trail of where the loans change hands.

Edwards urged students to stick with federal loans until changes could be made within the private sector.

“If I had to do this again and take out a private loan, I wouldn’t let my son go to school,” Edwards said. “We started out doing business with a bank we trusted and they passed along our loan like it was a joke. Private loans should be eliminated altogether because they are nothing but a trap.”

Recommended: Articles that may interest you


log out