Just Sign Here

I don’t see how young people can avoid making bad credit decisions. It seems everywhere my brother, who is 18 and starting university next week, turns there are companies offering him credit. He has received no fewer than ten different communications, mostly e-mail, from his school’s financial aid office imploring him to sign a master promissory note. He was all ready to sign it until I told him he doesn’t need to. He’s not getting student loans.

He tried to decline the student loan offers via the school’s self-service Web site, but every time he cleared the check marks and clicked submit, the check marks re-appeared next to the student loans. He telephoned and e-mailed his financial aid office and told them he wished to decline the loans. Yesterday he received an onimously worded letter in the mail from his financial aid office warning him that his tuition may not be covered if he doesn’t sign his master promissory note.

Uh, excuse me, for whom do these people work? It’s obviously not the student.

We stopped at Chase yesterday so Eric could deposit the refund check he received from the bursar. Before we could approach the teller, a lady at a desk (who wasn’t much older than Eric) summoned him over. She told him she would gladly take care of him. And, boy, did she. First, she completed the deposit slip for him. All he had to do was sign his name. Hmm, I’m starting to see a pattern here.

In the process of depositing his check, she tried to sell him three products: a) student loans (!), b) savings account, c) auto loan. While he could use a savings account, I doubt that she had his best interests at heart.

It’s little wonder we’re a nation of debtors.

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6 Comments

Filed under The way the world works

6 responses to “Just Sign Here

  1. I got my first credit card after filling out an offer from Citibank that came in the shopping bag I was given when I purchased my textbooks the first semester of my junior year of college. I was working less than 10 hours per week and making minimum wage at a workstudy job, but Citibank had no problem extending credit to me without even a parent’s signature as a co-signer. I didn’t abuse the credit, but it would have been easy to, and I knew lots of other people who graduated with thousands of dollars in credit card debts on top of their student loans.

    It was easier for me to get my first credit card than it was for me to rent an apartment on my own 2 years later when I was making $25,000/year and had a spotless credit rating. Then, they wanted my parents to co-sign.

  2. That’s awful. I bank at a smaller local bank because they are less agressive about the sales crap – First Indiana and I highly recommend them if anyone’s in the market for a new bank. Anyway, credit cards are in my opinion one of the things that will be at the hands of the fall of the US as we know it. I had a similar experience – credit card offers out the wazoo during and after college (what WERE they thinking offering my broke ass a $5000-limit card in college???). And I learned the hard way. It took me several years to pay off the debt I racked up making a pittance as a research assistant during school and then making $17,000 right out of college. I’m not financially unsavvy – I fell down this rathole because my parents never carried debt (we were not wealthy by any means, they had one credit card they never used, and saved and scrimped to buy everything in cash – if they did not have the cash they did not buy it and only debt they ever carried was their first house) so I was not taught the “right way” to use the card and fell into that eyes bigger than my wallet issue. I don’r blame them per se, they just assumed I would use credit the same way they did, which was not to use it. I learned my lesson the hard way – Eric’s lucky he has you you guide him and I plan to teach my kids responsibility as well. We now use our debit cards for everything and each have one credit card to use for work travel and emergencies only. My car is paid off and we won’t get a new one until Dave’s is paid off this winter.

  3. Charlie’s still in a similar situation. It took him 10 years to get his Bachelor’s degree after you figure in the Navy (for which he signed up at 22 to help pay student loans and later found out there was a bit of a catch to all of that), losing an athletic scholarship, and transferring schools several different times.
    I, on the other hand, just recently started pursuing my degree for the first time. I worked in social services when I was younger and got sucked into the high-interest credit cards because I was making $5.15 an hour but was also trying to help out the clients who’d just come out of Central State with nothing in their pockets. The credit cards I eventually got were generally maxed out at Christmas so I could get gifts for family, or to make car and insurance payments since my checks from work were never enough. I’m mere months away from being debt-free and I’m glad. It just totally blows that it’s taken me twelve years to do it.

  4. I watched my parents struggle with credit card debt and am absolutely scared shitless about getting into any kind of debt now, especially credit card-related. I did nearly sign up for one this past year (my first year of college) as a “just in case” sort of thing, but decided not to at the last minute. Which I’m thinking more and more was a good choice.

  5. Yeah, I definitely think you have to be careful with credit cards. The sad thing is that even when you are careful, it’s really easy to get in trouble. For example, I had a card with MBNA. They alleged that I paid my bill late. I submitted the payment on time. Regardless, they charged me a late fee, and I refused to pay it. I called them up and asked them to cancel the account.

    Even though I closed the account, they continued to charge me a late fee every month because I didn’t pay the first late fee. By the time it was all said and done, they charged me over $300 in late fees. When I called them to tell them that I had no intentions on paying, they offered me all kinds of settlements – they agreed to knock it down to $150 if I would just agree to pay the funds right then. That only convinced me of how bogus the charges really are, so I told them that I wanted to pursue my arbitration option. Before I could file the paperwork, they bounced my account off to a collection agency.

    I hope it was worth it for them. They lost me as a customer, and I badmouth them every chance I get. I’ve had an account with Discover for almost four years now, and I’ve never had any problems. They’re very reasonable when misunderstandings occur. Before that I had an account for several years with American Express, who are also very good at resolving problems before they escalate.

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