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johnny0313x's avatar

So I have an idea to start a program for students in debt with student loans, how can I start this?

Asked by johnny0313x (1855points) February 6th, 2009

So I’ve been thinking of a way I can help pay off my student loans and have been searching the internet for some kind of method but have come up with very little for means of a quick and easy solution. I was thinking about how many people have the same problem and can’t do anything about it. So I was thinking nobody invests time into doing something positive anymore, so why shouldn’t I try to do something. I was thinking that maybe I could somehow start a program to help pay off student debts, there would be limitations of course! I was thinking about maybe starting a website where people could donate money or even gift certificates so people can use their own money to pay the loans rather then gas or food. Now I know you are thinking well people will take advantage of this, which is why I said there would be strict regulations. For instance people would have to sign up and send a receipt of their student loan payment for that month, then a portion of the donations could be sent to them or to the loan office. I mean it would take alot of thinking and figuring out, but how does someone go about starting something like this without it seeming like a scam or without getting in trouble legally. I’m sure their are people out there that don’t have kids that would be willing to donate to such a cause. Do you think is is a crazy idea?

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10 Answers

bristolbaby's avatar

first of all, paragraphs are your friend.

it sounds like you want to set up a non-profit agency. You need to file with your state to begin. You must have a plan in place before you file. For example, your start-up capitol needs to documented and the tax people will be all over your paperwork.

Keep clean, clear and concise records. You will need proof for anyone that receives $$ is actually eligible. The same goes for anyone willing to donate. You will have to provide your tax ID number as a non-profit agency so they can report it as a donation.

Introverted_Leo's avatar

I can only offer words of encouragement, but I don’t think it’s a crazy idea at all! My mom wanted to do something similar to create scholarships for hard-working students that don’t necessarily fall into the “I’m really smart, look at my high GPA” or “I’m really poor, in a tough situation and in dire financial need” categories, if you get what I mean. I hear all the time from friends how much money they have to pay off in student loans, and it’s really ridiculous. So I think this would be a great idea.

I hope you find a way to get a kick-start on this. I’m sure it would do well. : )

dynamicduo's avatar

Sadly I do think it’s a crazy idea. Your intentions are great and pure, but honestly, you will be scammed in some form or another. For instance, I can easily Photoshop up a student loan receipt. And in an extreme case, I could possibly get a job doing some programming or marketing at your company, and take all the money one day. You’d need the help and cooperation of the loan agencies to verify the loans, and they’re not wanting to have their debtees pay off their debts any faster, because as you know they’re making a ton of money off of them.

I think, before you jump in to some type of micro or personal loan service (of which there are many longer standing and secure ones), you may want to start up a website with information about these loans, both to inform people who haven’t gotten a loan yet about the possible consequences, and to help people who’ve signed up with awful termed loans to renegotiate or find out what their options are, etc. This will allow you to gain much more information about all sides of this issue, which will be helpful if you ever do decide to pursue a micro loan site.

Edit: then there’s the whole legal angle of this. And then there’s the question of whose laws do you even use, as someone from State A could loan money to someone from State B. Basically, you’d have to spend a lot of money to make your site pretty sue-proof… but there’s no guaranteeing that someone won’t sue your site anyway for a deal gone bad or whatever reason they think of. As nice of a person I am, I am not nice enough to be willing to pay legal costs from my own pocket to defend this sort of website. And you can’t take money off the top of the donations either, well you can, but then your credibility is seriously hampered. Things really get sticky when money comes into play, sticky enough to discourage me from looking into it further.

kevbo's avatar

You’re making me think of and also about this credit card issuer that featured cash back for student loans/tuition. I don’t remember then name, but it was featured in Lifehacker or Consumerist a while back.

galileogirl's avatar

The govt may do this if you have the right kind of degree and agree to work in an underrepresnted area. Any Special Ed teacher can get some reduction in student loans. Drs and nurses who agree to serve in rural or inner city practices and Science and math teachers can benefit—see Perkins Loans and Stafford Loans

Americorp offers the opportunity to reduce student loans if you serve for 1 year in a community service project. You get pament for your living expenses and upon completion about a $5,000 loan credit

Serving 4 years in the Peace Corp can excuse up to 70% of a Perkins loan

johnny0313x's avatar

Sorry for my bad grammar, I usually type these things are work and have to keep it on the DL so don’t have time to verify my grammar and spelling. I do my best, I will try to be more careful about it in the future.

yikes that all sounds pretty hard, and I do need to support myself too im not sure i’d be qualified to start such a program but I’d really like to do something that benefits everyone overall. I feel like nobody does this today.

PrancingUrchin's avatar

I don’t know but contact this broke-ass college student when you’re done.

scamp's avatar

Here’s a whole page of similar programs you can look at to get ideas. Sorry, but I don’t have any idea how you would do this. As for me personally, if I wanted to donate money to help pay off tuition, I would more than likely give it directly to the institution and not some unknown person on the internet.

johnny0313x's avatar

Well maybe I could have people submit the bill for the loan and I can pay direct to the loan office. See the problem I feel with the few programs out there now is that, I don’t feel like the money actually goes to anything. I see supermarkets donate this amount or that amount to college funds…but really where is that money…didn’t make my schooling any cheaper, i didnt see a big sign at my school saying THANK YOU WEIS MARKETS FOR YOUR DONATION OF $8000 TO IMPROVE OUR SCHOOLS CLASSROOMS!! No I feel like some asshole was like THANK YOU WEIS MARKETS FOR YOUR DONATION TO MY WALLET!! I hate the way alot of programs are set up because I feel like people that really need the money never see it. It’s sad.

AlfredaPrufrock's avatar

Have you talked to a program like A coworker had a ton of credit card debt, and went with a debt consolidation program. They negotiated her rates down to %6, halted her open credit, and put her on a repayment program that had her paying off all of her debt in 6 years at their payment rate. The way to get rid of it is to not incur new debt, and put every available extra cent to the principal. If you take on free lance work, don’t look at it as found money, but as principal reduction.

And I would write your congressman and senator. I wrote mine about your situation.

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