[pbreit]

So basically, California specifically forced them to create a special contract, different from the one they use everywhere else, that couldn't be discharged and then censured them for not clearly enough stating that the special California contract couldn't be discharged?

Sounds very California.

[kelnos]

I get the feeling you're arguing in bad faith here due to some axe you have to grind with California, but I'll try to clarify.

Lambda was deceptive about the terms of their ISA (the one they now use everywhere but CA). CA's laws require lenders to disclose certain things to their customers, and Lambda didn't want to do that.

So, being the childish dicks they so clearly are, they retaliated by creating new terms that are worse for CA-based students. No one forced them to do this; they could have kept the same contract but properly disclosed the things they were required to disclose. And on top of that, they lied about whether or not their loans could be discharged in bankruptcy. This particular regulatory action is solely about this last thing.

[pbreit]

I get the feeling you're arguing in bad faith here due to some axe you have to grind with Lambda.

[dragonwriter]

> So basically, California specifically forced them to create a special contract, different from the one they use everywhere else, that couldn’t be discharged

No, again, the specific lie that they are getting in trouble with is claiming that the California contract was a “qualified education loan” which could not (easily) be discharged in bankruptcy when, in fact, it was a regular unsecured loan which can easily be discharged in bankruptcy.