by Jennifer Ingram
Sallie Mae is one of America’s largest private lenders specializing in education. According to their website, Sallie Mae has provided financial services for nearly 25 million customers, as well as hundreds of college campuses.
For those seeking help with the cost of higher education, Sallie Mae offers tuition insurance, online banking, scholarship programs and tries to help family’s nationwide plan, save and pay off college.
While like most banks they strongly suggest their customers have a cosigner on the loans they take out, they do provide loans at a 9.75 percent interest rate for those who cannot provide a cosigner.
However, unlike most federal loans which allow unemployed students to defer their payments without penalty fees, Sallie Mae does not.
In the opinion of Stef Gray, a recent graduate from a public college in New York, Sallie Mae made her life very difficult for being unemployed and therefore not being able to make her payments.
Sallie Mae charged Gray hundreds of dollars in extra fees, called forbearance, because she had to delay her payments due to her unemployment.
In a phone press conference Monday Feb 6., Gray explained her frustrations with the unemployment rate and her inability to pay back her debt. She said both of her parents had passed away by the time she was 12, and therefore she needed to take out loans to pay off college and didn’t have a cosigner.
“I always maintained good grades,” she said. Gray graduated this past May with honors, receiving her technical degree in just three years. Yet she was still unable to find work after graduation.
“I even applied to clean toilets at a hotel,” Gray said.
Gray had three loans for the three different years of school, but without loan consolidation. Therefore, Sallie Mae charged her a $50 fee for every three out of the 36 months she had been taking out loans. When it came time for Gray to pay $300 just in forbearance fees, she started to raise some questions.
She wrote on Change.org that Sallie Mae threatened to fine her an extra $150 if she hadn’t found a full-time job by the end of January, which would send her total debt from fees up to $1,200.
“I want to repay them every penny I owe them, but they’re making it so difficult,” she said. “I just want to get back on my feet, get a job, and make my payments.”
Gray then decided it was time for a change. She created a petition, which she titled, “Stop Double-Dipping To Cash In On Unemployed Graduates.” She addressed her appeal to Sallie Mae CEO Albert Lord and asked him to “end the unfair practice of charging the unemployed a fee for forbearance.”
William Winters, who joined in on Gray’s press conference Monday, said that Gray demonstrated the power of platform and of social media. He said within the last two weeks, Gray went from having zero to 1000, and now more than 100,000 signatures on her petition for Lord.
When asked about her petition, Gray said this wasn’t just for her, but rather all the people standing behind her who have been in the same situation.
Another petition has started on Change.org by writer Cornelious Coe, who is in the same position as Gray. Coe wrote that they feel Sallie Mae has taken advantage of them as well as many other Americans who have defaulted student loans.
Coe said he owed Sallie Mae $37,000 in loans, but have paid over $68,000 just in interest (not a penny has gone towards the actual loan).
“I’m looking to bring all these issues to light,” Gray said.
On Thursday, Feb. 2, Gray’s petition was brought to Lord’s office in Washington D.C. which included 76,000 signatures. ABC, NBC and CBS were all there to report on the situation.
“There were armed cops for the reporters and cameras,” Gray said. “I just thought it was silly.”
She said the Sallie Mae executives refused to meet with her, and the PR spokeswoman didn’t respond to any of Gray’s phone calls. When they finally let her into the building, she said she felt so disrespected.
“The executives wouldn’t even look at my face when I dropped off the signatures,” she said. “He was very rude and he only gave me two minutes of his time.”
However, Gray finally got some attention. According to Change.org, within three hours of the deliverance, Sallie Mae changed its policy so that the company no longer pockets the unemployment penalty, however they do still charge it.
While Gray is glad that she and her 118,000+ supporters have helped make a change in the financial market, they have also made it clear that they are not stopping here. When the company changed the provisions of the fee, she said she felt very much empowered. However, she wants the fee to go away completely.
“It does nothing to help borrowers like me who are in real financial trouble,” Gray wrote on Change.org. “Sallie Mae isn’t going to get rid of us by offering weak half-measures.”
Gray is asking students across the country to help get involved and end Sallie Mae’s “financial suicide” by going online to Change.org to sign her petition.
Contact Jennifer Ingram at email@example.com.