Disabled Can't Escape Student Loans
WASHINGTON (AP) -- America's seniors and disabled cannot escape debts from
old student loans, the Supreme Court ruled Wednesday, freeing the government
to pursue Social Security benefits as part of an effort to collect billions
in delinquent loans.
The Bush administration had argued that the ability to withhold Social
Security benefits is an important tool in the pursuit of $5.7 billion in
student loan debt that is over 10 years old. Overall, outstanding loans
total about $33 billion.
Government lawyers said there is a limit on how much can be taken from
benefit checks, 15 percent, and that the Education Department can forgive
debts in some hardship cases.
The unanimous decision went against a disabled 67-year-old Seattle man who
lives in public housing and had sued claiming he needed all of his $874
monthly check to pay for food and medicin
James Lockhart's benefits had been cut by 15 percent to cover debts he
incurred for college in the 1980s. He has about $77,000 in unpaid loans.
The court's decision applies to loans that date back more than 10 years, and
covers both disability and retirement benefits under the Social Security
program.
Senior citizens groups did not know how many elderly or disabled people
could lose some of their monthly checks if the government decides to go
after them.
The Supreme Court was called on to clarify federal laws that sent
conflicting messages about the collection of old loans. The government first
began withholding the money from Social Security benefits in 2001 and has
defended its authority to do so in court.
The ruling, written by Justice Sandra Day O'Connor, will probably be one of
her last. She is retiring after 24 years.
In a concurring opinion, Justice Antonin Scalia said that Congress
"unambiguously authorized, without exception, the collection of 10-year-old
student loan debt. ... In doing so, it flatly contracted and thereby
effectively repealed part of the Social Security Act."
Groups such as the AARP and the National Consumer Law Center had urged the
court to safeguard Social Security benefits in the Lockhart case. The
benefits, the organizations said, "are critical in preserving a measure of
financial independence for older and disabled workers."
Also Wednesday, new Chief Justice John Roberts announced his first ruling,
in a case involving legal fees. The 9-0 decision backed insurance companies,
which argued that they should not have to pay legal fees of a New Mexico
couple in a case that was shuffled from state court to federal court, then
back to state court.
probably will get flamed for this
BUT....the guy incurred the debts in the 80;s.....25 years and he still owes
money??
sorry...but the majority of us can manage to budget and buy back loans in
this period of time
this sounds like a "poor me" scenerio to make the govt look bad