Teacher’s Wages Garnished as U.S. Goes After Loan Default

Judy Hartnett's picture
Tuesday, July 3, 2012

Lawyers drained Linda Brice’s bank account and seized a quarter of her take-home pay, or more than $900 a month. Brice, a first-grade teacher and Coast Guard veteran, begged for mercy, saying she couldn’t afford food, gas or utilities.

Brice’s transgression: she defaulted on $3,100 she had borrowed more than 30 years ago to pay for college. The chief federal judge in Los Angeles took her side, ruling that Brice should pay only $25 a month. The law firm of Goldsmith & Hull -- representing the federal government -- then withdrew $2,496 from her bank account.

Linda Brice, a Los Angeles first-grade teacher, rifles through paperwork from the student-loan collections lawsuit filed against her by a private law firm representing the federal government.

“I am at the end of my rope,” Brice wrote in a May 2009 court filing. “I apologize for taking the court’s time, but I simply do not know what to do.”

Brice’s case shows how tough the government can be when it comes to collecting its share of student-loan debt, which totals $1 trillion, surpassing the amount owed on credit cards. Students who borrow as teenagers and whose degrees don’t pay off confront some of the harshest treatment and fewest chances for a fresh start of any debtors, except those owing child support.

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