Monday, April 23, 2012

Should "Banks" "forgive" student loans of the deceased?

Here's an email that I received from William Winters at

Marc -
A family tragedy. In 2004, Ryan Bryski's younger brother, Christopher, went into a coma following a traumatic accident. The coma stretched on for two years. Christopher passed away in 2006, when he was just 23 years old.
Heartless creditors. Even though Christopher has been dead for six years, Key Bank is still trying to collect on $50,000 of his student loans -- Christopher's dad has even had to come out of retirement just to make the monthly payments. Nearly every other major lender (Sallie Mae, Wells Fargo, Citi, etc.) works to forgive the debts of students who pass away. But Key Bank refuses to follow suit with the Bryski family.
You can help. Christopher's brother, Ryan, started a petition on asking Key Bank to forgive Christopher's debt. Ryan believes that shining a public spotlight on Key Bank's heartless behavior will force them to follow the lead of other major lenders and forgive the debts of students who pass away.
- William and the team
Here's a lot more information about Ryan's campaign, in his own words:
On June 17, 2004, my brother Christopher Bryski sustained a severe traumatic brain injury in a tragic accident. He remained in a persistent vegetative state for two years before passing away on July 16, 2006. That's when the calls began.
You see, our dad cosigned Christopher's private student loans with Key Bank. When Christopher died, Key Bank came after my dad to get their money back. Our dad has had to come out of retirement to make the monthly payments. When Christopher died, my family didn't just lose a loved one -- we inherited debt for an education that will never be used.
Key Bank's actions are dramatically out of step with the status quo. The federal government and even large private student lenders like Sallie Mae and Wells Fargo all forgive student loans once the borrower dies. But over the years, Key Bank has ignored our calls to take this humane step.
In the years since Christopher's death, my family has tried to keep others from facing what we have. We've worked with members of Congress to pass "Christopher's Law," which would make sure student borrowers and their families know exactly what could happen if they die or become disabled, and we've started a website about our efforts to get Christopher's Law passed.
This work has been meaningful and important. But it doesn't change the fact that every month we're reminded of my brother's death in the worst way every time dad puts a check in the mail to a heartless bank. That's why I'm asking Key Bank to relieve my family of this terrible burden and discharge my brother Christopher's student loan debt.
Thank you,
Ryan Bryski and Family
U.S. Air Force Veteran

Here's my response:
Ryan should have had life insurance. The story is sad, but the lesson is not forgiveness but in proper planning for the future and taking responsibility. Neither the shareholders nor the employees of the bank nor the entire taxpayer system should have to shoulder the burden.

On a more empathetic note, it is a terrible shame that the family not only has to live with the loss of a beloved family member, but a constant reminder of his passing.

Cold? Perhaps. But debt is debt, regardless if it is student debt, credit card debt, or mortgage debt. Debt means that there was money borrowed from one party by a second party to pay a third party. Why does the bank eat the money? Why doesn't the payee have to give the money back?

And when the bank forgives the debt, it's not some faceless entity that loses the money. That means that shareholders of the bank have less profit from which they can be issued dividends. That means that hardworking bank employees have less money for salaries or that bank employees may have to lose their jobs to accommodate these losses. (Yes, on a side note, I know that recent events have banks in bad light, but don't blame bank tellers and people at those "expendable" positions take the fall. The CEO and other high-ranking, high bonus positions will not lose their jobs in this case.) And if the government steps in to pay for the debt, that means that the entire taxpayer system is paying the debt.

That is what life insurance is for - to protect in case of premature death. An insurance policy that would have covered that debt likely would have been very inexpensive.

So instead of petitioning Key Bank, take the time to teach yourselves and your kids about financial awareness and good financial habits. Teach kids to save money so that they have 3-6 months of expenses in the bank that they don't touch. Teach them to get life insurance to protect their family (wife and children or, in this case, siblings and parents).

We cannot blame the world for personal tragedies. We look inside ourselves, take the lessons learned, and move forward embracing the legacy of lives lost.

1 comment:

  1. I'm sorry but i have to agree with the bank on this. It is tragic the loss of a loved one and no one wants to deal with the loss or the aftermath of it, but the fact remains it happens and if that person has debt and you are the co-signer you can blame someone else and say they did not tell me i was responsible and please stop trying to get sympathy by putting you are a VET. I am a vet as well and saying that has nothing to do with this situation it is a pure feel sorry for me move.