Today's New York Times reports on the collapse of Kentucky's Best in Class loan forgiveness program for teachers in shortage fields, putting names and faces to the sad story and linking it to troubles in other places.
Do read the whole piece (here). It's painful and important reading.
Don't, however, take lightly the report that Ted Franzeim, head of customer relations for the Student Loan People "added that the group had never told participants that financing for forgiveness was guaranteed."
That is not true.
The program was presented all over the state as an incentive to borrow from Mr. Franzeim's organization. As an example, here's a clip from their executive director's 2002 legislative testimony:
More proof that the Student Loan People described Best in Class as a promise students could depend on is here, here, and here.
Either Best in Class was an honest promise or it was a trick to lure in borrowers. That second option is terrible to think about: dishonest incentives to student borrowers are forbidden by federal law and warrant major enforcement action by the federal Education Department.
I don't think Best in Class was a trick or a lure. I think it was a promise, made when the Student Loan People believed they would be able to afford to keep their word. The dishonest part is happening now, when they claim they made no promises and offered no guarantees.