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The Student Loan Dilemma
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Registered User regular
I have a private student loan through Sallie Mae. I currently owe over $30k. It's a depressingly large figure that looms over my life. I try not to think about it.
I recently used up all of my deferrments and am now facing the uphill battle of paying for something with money I don't have.
At the moment, my degree is not being used and I feel very angry at having to pay a great deal of money for something that is not providing me any type of benefit, monetarily or otherwise. But, that's a different topic.
I called Sallie Mae, explained my situation, and was told that perhaps their Collections or Ombudsman might be able to lower my payments or provide me with other options.
Are any of you aware of something that I might be overlooking or know of ways to further defer your student loans?
I recently used up all of my deferrments and am now facing the uphill battle of paying for something with money I don't have.
At the moment, my degree is not being used and I feel very angry at having to pay a great deal of money for something that is not providing me any type of benefit, monetarily or otherwise. But, that's a different topic.
I called Sallie Mae, explained my situation, and was told that perhaps their Collections or Ombudsman might be able to lower my payments or provide me with other options.
Are any of you aware of something that I might be overlooking or know of ways to further defer your student loans?
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Student loans are with you until you die; that's the only way to get out from under them. You can't declare bankruptcy or anything to get rid of them. Your options are pretty much what they gave you: talk to their collections department or their ombudsmen to try to work something out. There may also be some sort of federal program you could get in on to allow you to defer your loans for longer; I'm not intimately familiar with the rules, but it seems like something that might have gotten extended along with unemployment benefits.
Alternatively, you could look into something like the Peace Corps or Teach for America, though I hear that those are super-competitive with the current job market.
That's why you have to be really careful when you sign up for tens of thousands in student loan debt. It's nearly impossible to get rid of without actually paying it, and one of those things that you usually have to eventually be an adult and take responsibility for.
If you think that you'll be in a better place financially in a year or two it may be worth it since you won't have to make payments in the meantime. If you don't think you'll be earning any more in a year or two then it's just delaying the problem, so you'd be better off trying to work out a lower payment plan with them. Depending on how your payments are calculated now, you may be able to get up to I think 4 years of lowered payments which then goes back up for the remainder of the loan - it's either their graduated or select-step payment plan I believe.
This won't save you any money, as it will extend the term of your loans. However it will lock in a rate that is at historic lows, and there is no penalty for early payment down the road when you get your feet under you.
What it will do is cut your monthly payment considerably, and lock in a very low rate. Also, if you have multiple loans, it will consolidate them into 1 student loan which is easier to deal with.
The process takes a while to complete, but it may buy you some much needed breathing room.
Here is the link
My wife recently graduated with 40k+ in student debt, the monthly payment was variable and currently around 600/mo. which was painful. With the consolidation, we knocked it down to around $350/mo. Like I said before the term is out to 20 years now, but we will be able to pay it off early w/o penalty. The breathing room allowed us to attack some CC debt and a car payment first, and can now focus more on the Student loan debt.
Good Luck!
Students who come out of schools that Sallie Mae has "intimate" relationships with (there's even a class action lawsuit against them) often these students are showing up with $600 student loan payments where Ivy League schools barely encroach in that obscene level of payment. That's more than my parents pay for their mortgage and it's double what I pay for a car.
That's less "take responsibility" and more "hope you're a doctor or live in california olololol." Sadly.
Oh yes, you can do this sure. But it'll cost 50 dollars per loan you get a forbearance on, and it'll only last for three months, plus there's the addition of interest. Basically you only do this if you literally cannot pay.
Sallie Mae are criminals.
Sorry I don't have enough lime to pop on there. Oh what's that, I can't consolidate my loans because my school has a higher default rate than other schools? Thanks, that really helps me not default on my loan.
I'm almost willing to take the default and 7 year hit on my credit, go to court, and fight with collection agencies than be in debt for 30 years.
Associates. I shit you not.
Would Income-Based Repayment help you out?
I paid nothing (except compounded interest as I mentioned) and it was for 2 years. So no.
And also, that fucking sucks dude, hope you find some help.
They charge $50 per forbearance up to a maximum of $150, whichever is less. I am intimately familiar with this procedure.
What the fuck man? Where the hell did you go to school that you would owe that much for an associates?
(illegal because they charge so much and spend most of it on advertising to attract more students and live off the govt via students who take out loans)
The forebearance stuff is good advice. I've had friends who've had to go that route.
Really depends on your degree. I'm a Linguistics major, getting a TESL certificate, with minors in French and Anthropology who will have learnt a bit of Swahili before I graduate and I'm applying to go to Africa. Pretty much a shoo in for that.
Got a Business or Psychology degree? Probably not going to have a lot of luck.
EDIT: Alternatively, go to grad school. More debt, but you'll be way more competitive in the job market.
I'm with Daenris here... My wife got a forebearance until she got into grad school (in-school deferments, woo!); it didn't cost us a penny and it lasted a little more than a year before she was officially attending another school.
First things first.
30k ain't that bad dawg. I'm scraping 90k.
Second, the military isn't going to pay your loan, but it will afford you a lifestyle where you can take a significant portion of your income and use it to pay off your debt. You should consider it if you don't have social obligations that make it hard (like a wife).
Now finally... the options they gave you.
Whatever you do, DO NOT consolidate these loans with a third party unless you are goddamned sure you can pay them. My mom made this mistake. She got them down to one reasonable payment, and she stopped paying them, and now I am paying it, and it's almost twice as much per month now thanks to her delinquency.
Loan consolidation companies have very short patience.
When Sallie Mea says "collections" they mean internal collections, which is an entirely different department and it's NOT the same as an *actual* collections agency. It's better. Because they won't report to your credit.
Like one time one of my loans I forgot about and they sent me to internal collections because I owed 16 damned dollars.
So call those people, internal collections. They'll need to get a certain amount of money out of you relative to your total debt to avoid going to Plan C, which is basically when you are fucked.
So at least *try* plan B. The key here is that you need to pay money, and if don't have any, then you better start figuring that shit out right quick, because this school loan will NOT go away. There is no way to dodge it. It's with you for life.
we also talk about other random shit and clown upon each other
You should probably be more worried about finding a job or even a full time job and a part time job.
And I think it's pretty obvious the OP has been looking for a job; I don't know if you realize this or not, but just looking really hard does not somehow magically make a job appear for you out of thin air.
I took intro and intermediate autocad, which I already knew all about. Both night classes 6-9, mw for one and tth for the other, but most of it was lab time and I could finish way early, work ahead and probably only went 2 hours a week. Since I was technically half time my loans went back in deferment. 300 for classes got the semester deferred.
This was 08, stafford loans and not sallie mae, in california so it might not apply to you at all, and who knows what community college classes cost these days and if you can afford it, etc.
Maybe this is a more recent development as I definitely did not pay any additional fee when I got my forbearance. The application document for it in my account doesn't mention a fee, but who knows. It does however spell out that it's for 12 months, so definitely not the 3 that Adus was suggesting. And it was renewable after a year for another year at least.
I meant "forebearance." I apologize for the confusion. I've used up all of my deferrments and forebearances...actually, I have a one month forebearance left...
Correct. This is a private loan. I'm looking at the number right now: $27,621.55 (principle).
I also have a federal loan for about $25k that is currently in deferrment status. I signed up for the income-based repayment plan. Since I've been unemployed, my payments are $0.
My only problem is this damned private loan with Sallie Mae.
With Sallie Mae? What type of loan was it exactly? Because I'm talking about private loans where there's pretty much no leniency whatsoever. For Private loans, deferrments are only available as In-School deferments or Internship/Residency deferments. Which is nothing if you're out of school and not an intern.
And the only forbearance available is Voluntary Forbearance which is the 3 months for 50 dollars per loan.
So if you got a year or two on private loans with no cost to process, then things indeed must have changed and I really envy you.
For instance, I owe probably about $10,000 in federal loans. Which comes to a monthly payment of $100 for 10 years. My private loans? $30,000 with a monthly payment of $500. Had it have been $300 like everyone else, that'd be great. But I was one of the 3 people in class that didn't have my parents cosign so of course I got an interest rate of 15%.
Oh, but they don't have to show you private loan payments on your exit papers, so of course I signed away my life not knowing my actual bill was $600, not $100 like it said. Of course I didn't even get to see most of my loan information until I graduated because the financial aid people got laid off so much that it was impossible to tell.
Good luck Slider, let us know how you do!
I, at least, am talking about private loans through Sallie Mae. I have roughly double the $30,000 that you and slider have and had no cosigner, so I'm familiar with the payments.
Obviously (understandably) things must have changed in the past 2-3 years, as when I needed to request a forbearance there was no fee and it was for 12 months, then renewed for another 12.
In all these student loan threads I hear nothing but hate for Sallie Mae, but personally I've never had any problems with them. Again, that may be something that's changed in the past couple years since I've really had to talk to them.
slider, if you absolutely can't make payments you should definitely look into the forbearance option. However, if it does charge an additional fee and only lasts 3 months it may not be that helpful. Unfortunately, as others have said, there's basically nothing you can do to discharge or reduce private school loans, so you have nothing to lose by at least trying to talk to Sallie Mae to get a reduced payment somehow.
If forbearance is out -- or if you can afford reduced payments -- try to get put on their Select Step payment plan. This is a lowered payment for a period of time (I believe 1, 2, or 4 years). The down side being that after that time your payments will be even larger than they are now, so it's only a delaying tactic that doesn't really help if you're no better off in a few years.
Your payment will jump up by about 25%, you're better off working 4 minimum wage part time jobs like BK now than hoping in 4 years you make 25% more money than you do now.
That being said, I never pursued it because MY loans fall under the "personal" category, even though I used them for tuition. I actually took this second, larger loan to pay off Sallie Mae outright because seriously...fucking thieves. Thankfully I saw that in my Sophomore year before I had to start repayment.
Does nothing. You still have to pay your bills while you're gone.
http://www.americorps.gov/
My friend got in and went through it. He's a great guy, but he wasn't top of his class or anything. You can get in, and you can do good in your own country.
Depending on your situation, it's worth looking into.
When you call the internal collections people, be frank with them. They'd rather get some money than have to fight tooth and nail for nothing, so just lay it out. They know the economy is bad and I'm willing to bet they'll work with you.
you say your degree is not being used right now... but searching for, applying, interviewing, etc. for Peace Corps or Ameri Corps, etc. requires exactly the same skills as applying for a normal job... one that can probably pay for your loans