Monday, September 5, 2016

Amazon exits scammy student loan biz partnership with Wells Fargo

"Consumer advocates quickly assailed the partnership between the two companies after it was announced in July. Pauline Abernathy, a former official in Bill Clinton's White House who now works for the Institute for College Access & Success, described the arrangement as "the kind of misleading private loan marketing that was rampant before the financial crisis." She said both companies buried the otherwise high costs and inflexible repayment terms that she said are standard in private student loans and that the deal was a "cynical attempt to dupe current students."

Undergraduate students can borrow from the feds at a 3.76 percent interest rate, a loan that effectively acts as an entitlement thanks to virtually no underwriting requirements. But the government caps student borrowing, leaving many to rely on private student loans to fill the gap between college costs and federal loan limits. A review of Wells Fargo's website shows student loans that carry interest rates as high as 10.93 percent.

"We congratulate Amazon for deciding to stop promoting Wells Fargo's costly private education loans. Private loans are one of the riskiest ways to pay for college," Abernathy said Wednesday."

rest at

1 comment:

  1. I’m glad that Amazon’s management has made the right decision. Today everybody knows that student loan debt is a huge economic problem and so many people are struggling to pay off their student loans. And what Wells Fargo does? They promote risky and expensive private student loans instead of offering reasonable options with flexible repayment terms. Many people work hard to repay their student loans and even turn to online loan companies to get financial assistance. I’m very glad that Amazon doesn’t take part in this dirty business anymore!