More than 13 percent of Americans are paying back student loans they received but one man took what some may consider a drastic action to escape the consequences of not paying back his student loan: he left the country.
Chad Albright graduated from college in 2007 with a student loan debt of $30,000.
“I couldn’t’ find any work, the only work I could find was work you didn’t need to go to a university for,” Albright said.
With his student loan in default, his credit ruined, and fears of any earnings being garnished, Albright went to China in 2011 and is now living in the Ukraine. He spoke to NBC7 from the Ukraine via Skype.
“I really wish I could come home, I have friends there,” Albright said. “I miss not seeing my family.”
Advocates for legislation to handle the growing student loan debt crisis believe not all of the blame lies on the borrowers.
“It has become harder and harder for people to stay in this country who owe student loans, said Alan Collinge, from Student Loan Justice, a grass roots organization fighting for consumer protections for student loans.
“The collection powers the government and its contractors enjoy would, in the words of Elizabeth Warren, make a mobster envious.”
Collinge said student loans have been stripped of the most basic consumer protections, like bankruptcy protections, truth in lending laws and fair debt collection laws.
Collinge says third party contractors hired by the government to collect loans make more money if the loans go into default.
“In the absence of all the consumer protections, it becomes a situation where people say their 20 thousand dollar loan can explode to hundreds of thousands of dollars,” said Collinge.
“An assertion that servicers have a financial incentive to encourage defaults is just false,” said Scott Buchanan from Student Loan Servicing Alliance, a non-profit trade association whose members are responsible for servicing 95 percent of federal student loans.
Buchanan said servicers are paid far more to keep a borrower current , not delinquent. He added servicers themselves are not paid anything at all to manage defaulted loans today.
Albright does not know how much his loan would be today, after so many years of growing interest and penalties. He did not ask for a deferment of his loan when he was unemployed but he did not try to get his loan out of default.
“I am not the only person in this situation. Why not ask the other 40 million people in the same situation?”