Although Private Student Loans only make up $150 billion of the $1 trillion in student debt (15 percent), it still affects a much larger percent of those with Federal Student Loans. Since federal loans only cover tuition and fees, many students with federal loans still have to take out private loans to cover expenses such as off-campus housing and other expenses. Private loans are also used for tuition as non-accredited schools. Studies completed this year show that half of all student loans are now in default or deferred status.
Introduction of bill HR 532
Of the drawbacks to using private student loans to pay for college or technical schools, the inability to discharge them through bankruptcy proceedings is probably the biggest. While it is possible to come to a private agreement with the lender, no court in the U.S. currently has jurisdiction over these debts. There is legislation now making it way through Congress that could change that though.
U.S. Congressmen Danny Davis (D-IL) and Steve Cohen (D-TN) introduced bill HR 532 on February 6, 2013. This changes the current bankruptcy rules to allow judges to handle private student loans just like any other form of debt through a lending institution. Other legislation similar to HR 532 has been submitted previously, but never at a time when so many graduates over the last five years have had to struggle in a just now recovering job market. Because of this struggle that affects so many students and their parents; public support for changing the bankruptcy rules has never been higher. As of May 2013, this bill has 14 sponsors in the House of Representatives.
Will this really help?
Not every government agency believes this is the solution though. The Consumer Financial Protection Bureau (CFPB) believes that the current student debt problems could easily become another debt crisis similar to what happened with sub prime mortgages in 2008. A report they issued in July 2012 believes that changing the law to allow student loans to be discharged through bankruptcy would be the final straw to break this particular camel’s back.
They also condemned a solution from Campus Progress made earlier in February. This idea was that the government would purchase private student loans in order to lower interest rates and allow for repayment options, such as the Income Based Repayment, that is offered in federal student loan programs. The CFRB pointed out that this would only reward lenders who made the riskiest loans and provide no incentive to those lenders who behaved in a responsible manner to continue doing so.
One positive suggestion from the CFRB was to address the issue of rehabilitating the credit of those borrowers who did finally repay their loans despite doing so late and with penalties. The program currently used for rehabilitating credit for federal student loan holders is a viable one and would adjust to helping those with private loans very easily.
The Student Loan Fairness Act
One other option might be passing the Student Loan Fairness Act. This is legislation introduced by Congresswoman Karen Bass (D-CA) in March 2013. It does not provide for discharge through bankruptcy, but instead uses the 10 – 10 model similar to many federal student loan programs. That is capping the monthly payments at 10 percent of the borrower’s discretionary income and after 10 years (120 months) of qualified payments, the remaining debt may be forgiven with not even taxes due on it. For those students who are currently unemployed, they would be able to defer payment without penalty until they do find work.
The Student Loan Fairness Act would also allow for private student loans to be converted into federal loans with all of the benefits that would entail. To accomplish this, borrowers would have had to be qualified for a federal student loan at the time of they took out their private loan. Their current gross income would also have to be less than the total amount of private debt they still owe on that loan.
No matter what solutions are eventually adopted, $1 trillion in student debt has to be addressed. Even if lawmakers can only work out solutions for the $150 billion in private loans, it will provide much needed relief for many graduates and their parents, who are struggling to find full-time employment, pay their bills and continue pursuing their own personal American Dream. Allowing borrowers to take advantage of Private Student Loan Forgiveness can go a long way in solving this crisis.
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Reading through all of these makes me sick that our youth must struggle so terribly to get through school when people from other countries breeze through and get their education here in the United State for nothing. Something is very wrong here. Thumbs up to CONGRESSMAN DANNY DAVIS & STEVE COHEN Law HR 532 for getting laws into place for relief they deserve without all this horrific stress. The tactic the bank uses is pressure the student- get the parent to inquire and the next thing you know you have a loan you never even signed for or heard of- Citi Bank did this tactic that I know of, then they sell all the loans to Discover a private loan company and there is no one who can get your name off of something you never even signed for?? I would think this tactic is illegal.
A few years ago my son was hounded by Citi Bank telling him if he didn’t take out their loan he couldn’t get back into school- my son asked if I could help by co-signing- I simply asked citi bank what I would qualify with my low income I thought maybe I could get him $2000. to help pay for some books. Knowing my income I inquired to try and find out the amount knowing my son would qualify for FASFA loans. I NEVER received word on anything again -I never signed for any citibank loans NEVER only an INQUIRY of what I coupld possibly qualify for and look at payments and see if it was even thinkable & doable knowing every summer I am laid off and out there scrambling for work. I thought I was refused and that my son got the school FASFA. NOW years later I am getting bills from DISCOVER- there were two loans combined I had nothing to do with I did NOT CO-SIGN for anything I simply INQUIRED and they are depleting my sons account overdrawing his account and coming to me who can not even find work..DISCOVER I DID NOT HAVE A LOAN IN THE FIRST PLACE.
I was reading through the comments and noticed that a lot of these conversations were from a few years ago. I wanted to know if anything has changed. I am also suffering with private loans at $713 a month not including my federal loans. I’m a public school teacher and am 1 year away from possibly getting my federal loan forgiven. But, like everyone else my federal loan is holding me back from being able to move out of my home and starting a real life. I took out a 12 year loan. I am 5 years away from finishing the loan and think it would be dumb to try and refinance when I’m not that far away, all the interest is paid off and I’m now only paying principle. Is there anything I could do to lower the payments some how or has anything happened that I may get my private loan partially forgiven. I’ll take any help I can get.
Jasmine not that we are aware of on a federal lender. As you said, you are probably best just repaying it on the remaining five years. You COULD refinance if you wanted as there are some new private lenders that offer good rates.
I Co-signed a Sallie Mae private loan for my son. he is not able to pay back as he has not graduated and left college in between. what option i have? as Co-Signer it will effect mt credit if it goes to default.
Not a terrible lot of options with Private loans. I think the first option is trying to have your son pay back the loan. He borrowed the money, time to make good on that and either find a job or go back to school. If thats not an option, then you as the co-signor also shares the responsibility of paying back the loan. You could look into refinancing it if your credit is good. You might be able to get more favorable terms refinancing. I would start here if you want to take a look at refinancing options.
I completely agree with the views expressed above. I tool out a student loan as well with the hopes that my college education would be able to better my future not put my deep into debt and ruin my credit, I took out a loan that was later bought out by Wells Fargo turning it into a private loan. As I called them to talk about options and help dealing with this situation I was rudely told by the girl on the phone to “get a second job” when she has no idea about anything going on in my life or if I did in fact have a second job. I now have two jobs, one in my related field, and another to try and get my head above water and to take care of repayments on my loans but even with that find it hard to make ends meet. I just do not think that it is fair that we are offered little or no help at all just because our loans are private. A student loan should be a student loan. They are used for education and I do not believe that we should endure extra grief because our loan is a different type that other peoples. I think that everyone trying to better their education should be given the same opportunities.
I have a private loan through Bank of American which was supposed to pay my full tuition at Sanford-Brown College in Fenton, MO. The school is no longer there and after I had my baby (I only missed 1wk of school) the school said I didn’t have any more money to continue my program. Now after 7 yrs of struggling to pay the loan and having hard times in between BOA are unwilling to help me at all! I can’t change how much I pay a month, the date it comes out and they said I need to have 3 mo of on time payments before they can do anything for me (deferment). My husband and I struggle each month to try to make these payments but they are unwilling to help us do so. Do not get a loan from them. Is there anyway to get this loan cleared either somehow through the school or even just consolidated with my previous Federal Student Loans? Thanks!
At this time there is no way that we know to convert private student loans into federal student loans. The only option you really have is to refinance with a private lender, but that would be difficult since you are behind on your payments and they will see that. I would suggest trying to get into good standing on your loan however you can, and then seeing if a refinance can help you by reducing your interest rate / monthly payments.
Go to the Consumer Financial Protection Bureau’s website they have an open investigation on ITT and peaks loan which is actually the same people. It is in fact illegal to pressure students into predatory loans. This lawsuit is a blessing. Whoever has a peaks loan should call them and give them hell because they raped our financial futures !!!!!!!!!!!!!!!!!!!!!!! !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Hey stay focused I owe private loans too up to 80,000.I will walk out the same way I walked in.will work to preservation try this money matters.I thought I was all alone too but hi you guys and we will become champions never give up just learn learn learn and at the end it will work.I am so frighten I wanna just get it over because I love my 5 children and when we eat laugh and sleep I get anxiety of losing the dinners the laughter and the good night sleeps the bathes and the foundation of my home.I’m super nervous.if you here anything I’m here.much love and support.
I need help to get rid of my student loans now.
I had the American Dream of being a “nurse”, but the RN program at my local community college had such a LONG waiting list (over 5 years at the time) i ended up graduating with my LPN (Licensed Practical Nursing) then decided because I am a single mother of 3 children that I would “look into” online classes through the “College Network”, they stated I needed to fill out paper work for them to accurately “quote” me, they had me sign a promisary note saying I would pay $7845 for the 2 year degree. I choose not to attend these classes nor pursue the online degree. Now 5 years later I am being harrased from a private student loan provider that the College Network had sold my private student loans to. I owe the $7845 without getting ANY kind of benefit from this provider, i saw NONE of this money NOR attended ANY classes. I no longer work as a nurse and I make minium wage in Wisconsin ($7.45/hr). I tried explaining my situation to this company that I do NOT make what i was making as a nurse, however she said unless I can make the $600/per month payment that they were going to “pursue” me by garnishing my wages and intercepting my tax returns. These private student loan companies need to be put in thier places…LIFE HAPPENS and not always they way we had hoped or planned. I am begging CONGRESS to address these private student loan companies AS SOON AS POSSIBLE. I am sure there are alot of other people in my position and don’t know where to turn. PLEASE HELP AS SOON AS POSSIBLE OR I MAY BE DOOMED AGAIN!!!
I have a Student Loan with THECB Hinson Hazlewood, I submitted a Reduced Payment Forbearance butthey refused it. I cannot pay the overdue amount $1800. I do not want it to go into default. I was denied a Stop Payment Forbearance after 41 months of using it. My co-signers are 2 of my family members and I don’t want anyone going to court over this. They are ridiculous. Please help.
I was the first girl in my family to go to college. I regret it. I graduated and had a job in my field until the company went under and I lost my job. This was 1 year after I had my now 4 year old son. I had to find work and fast so I went to work in a factory. I made payments and tried to get my payments lowered but AES wouldn’t (and still won’t) work with me. I am now in default. I tried to make my payments but with rent and utilities, I never have the full amount. I tried to do an administrative forbearance to get current but couldn’t afford the “good faith” payment they wanted. My grandfather co-signed on the private loans and after talking with him about it, he decided to make a one-time payment for me to get me current. That was 2 weeks ago. He told me that the money still hasn’t been taken from his account so I looked online and noticed that his payment had been rejected because the bank couldn’t find the account. I never received any kind of communication from AES that the payment was rejected (I have had payments get rejected in the past and always got an E-mail about it) and I am now in default on the loan. I am at a loss. AES will not work with me and I know they will do anything and everything to squeeze every last penny out of me and my grandfather that they can. I knew what I was getting into when I took the loan and, at the time, the economy was in OK shape.
The calls are endless. They call my grandfather, they call me and they have called my work which puts my job in jeopardy. I’ve cried for hours after putting my son to bed because I don’t know how I can fix this mess while trying to be the best mother that I can possibly be for my son. He is my life and the whole reason I get up everyday and work my fingers to the bone every day.
It’s come to the point that I have considered ending it all. Yes, I am speaking of suicide. I have two reasons for not doing it:
1. My son
2. My grandfather.
I know if I die, they will stop at nothing to get their money and it will put my grandfather in a grave if they take it from him because they can’t get it from me if I am dead.
I’m not sure why I am posting here. I guess I just want to connect with others who are having problems. A support group kind of thing I guess. My son has an amazing father (my fiancé) who is supportive and loving but doesn’t have the means to help me with my loans. Money is very tight (as he has hit a financial wall not having to do with student loans but other bills and debts).
I guess what I am saying is I am at the end of it all. I live for my son but have lost the will to live for myself. I would go to the doctor to get help with this crippling depression and anxiety I have from worrying about my loans but I cannot afford the bill or the medication that the doctor will want to put me on. Is there any light at the end of this dark, tunnel? Is there anything I can do?
Nicole please seek professional help to get through this. Student loans are not worth throwing everything away for, the collections agencies have a big bark but their bite isn’t as bad as it may seem.
It is your responsilibility to follow up with AES and not assumed everything is ok you must have confirmation
My name is Shivani. When I came to USA in 2008 as a student from India on F1 visa. I have $90,000 debt. I took a loan from Citi bank. Due to not having a permanent resident card or u.s. citizenship I had to apply for private loan with a co-signer. Now I am a green card holder. I just want Citi bank to lower my interest rate so that I can make easy monthly payment. Currently I am struggling to make monthly payment. I have to make $800 /mo which is more than half of my paycheck. Could you please help me or guide me with the solution.
Thank you.
I have a private student loan with sallie mae 25,000 plus they recently sold my loan to a collection agency name intgera solutions that are wanting a down payment to started the repayment on the loan. when will the student loan fairness act take place? Im trying to purchase a home but no bank will give me a FHA loan because of the student loan. Sallie mae is cheating people and very rude they do not allow different opportunties to better ourself, if they want work with you and your income. What will i need to do??
You borrowed the money to got to school and now you want to buy a home and you are in default I think you need to revaluate your financial situation
Cancer left me unable to finish school and now unable to work. With no relief from my private student loans, I now face the sad fact of losing my home to try and pay towards something that will never be paid off. I didn’t plan for this. Life happened and its only fair that in that event, there is some sort of solution to be released from this prision.
Chase Killed Me
May the 1st. My seperated wifes birthday. Happy Birthday Patti. I can’t give you anything now. You are the mother of my Children. I love you for that fore ever , Divorce or Not. I’ll give you a new chance at better life. I’m 48. I have a private loan with Chase. I’ve been talking to Tom Dixon or Dickson for a while now Tom D. Extension 2470017/Jim Mitchell Ext./ Jim Mitchell Extension 2470041.
I am permanently disabled. I tried to pull out of that stigma by going through PreMed for a better future. Dumb Idea I have my Fed loans forgiven but Chase refuses to after a quick decision.. I have about $25.00 left after a no frills lifestyle. No Vehicle. This week. I went into default to the tune of over $44,000.00 with fees, interest and penalties. My wife works partime at a Pharmacy as a tech. and is going to school to become a nurse. she has a condition that prohibits her from working in pharmacy anymore or touching me and the children with out rashes and pain as a result of two ingriedients in almost everything now and not to mention her immune system being taxed. We are getting a divorse and I can barely squeak by on my income. We have two children that we put on a brave face for, but they know its not easy. We had filed bank ruptsy to get a fresh start and get our lives in order and focus on a positive future. I have a $1021.16 mortgage and $1241.38 monthly PERS disability income. Chase is going to take it all. I tried to give plasma to pay my student loans with but I was told my veins were to small for the large gage needles. Chase ( Tom) said the suspected it wouldnt be a go because of drugs. I don’t take even medication unless I’m desperate. The cars are broke down, the house is falling apart. I live in a rural part of one of the Top ten dying cities in the nation( Middletown Ohio). I had hopes of going to one of the top 3 fastest growing and thriving cities in the nation, Murfreesboro Tennessee to start life over in a medical related field while having my children near a great community and college. We went there ,looked at housing, jobs and met the teachers, Pricipals and visited the daycare center. We were in awe of how beautiful our life ws about to become . Not perfect but better. Genetics research jobs were up my alley.
The skids got pulled out from under us when Washington Mutual was taken over by Chase . Our house depreciated from $159,000.00 to $112,000.00. I owe $108,000. to I received 5 grandkids through safe harbor USNAVY with no support after two months. Chase wont forgive, My credit is ruined at least the next ten years according to Chases make me feel bad tactics. My life is over, and most likely my family will be stuck in this hell hole also. I will owe the IRS taxes for the value of the Fed Loan Forgiveness Through Nelnet an possibly Chase if they cancel the loan. The IRS will seize the $4000.00 equity If I’m not upside down on my Mortgage by next year. More than 20 years to get out of this. My girls will be 30,28,and 23 by then. I can bare this. 1 solution and this all goes away for my family, only they will be without me. After some research I found out my life insurance policy more than 15 years old will now pay out even through suicide. But I will rest in hell better knowing that after the death clause, My Life Ins Policy that my family gets to go to Murfreesboro, TN and have a productive life. The day Chase Garnishes my wife wages soon or issues a court order to surrender I have to do the unthinkable for the better of others. Giving of myself by taking of my self. I have exhausted ALL other options. I don’t want to die, I really don’t, but now it is necessary. Hey CHASE, before you sell my loan you could’ve cut my disabled ass some slack and let me possibly be contributing to the community after rehabilitation. I would have love to contributed my brains to the better of others and later solicited you to let me pay back my debts because of my future assets and moral turpitude. I remember every cent I’ve owed and would pay it back if I gained the means. I am ashamed, embarrassed and have no hope. Thank Chase for Death Clauses. By the way … Sincerely to all… Merry Christmas in 2014 from me now to my daughters, Family, Whittney, Pat and to the world. Light a candle for me and forgive me. Love Michael
Michael I am really sorry to hear about your situation. I suggest you give Lifeline a call(800-273-8255)they can help you work through the difficulties you are having. Your family is not responsible in anyway for your student loans, they are solely your responsibility.
Micheal. I too got a loan from Chase. They too are ruining my life! It is a catch 22 every way I look at it. There is no way I can pay it back none at all. I will never get ahead I will always be under water. You are not alone. Money makes things easier but it is not everything. Killing yourself over a debt from the rich only lets them win!
I have over 100,000 in private loans and another 100,000 in federal loans. I have the federal in deferment but cant do anything with the private ones. I was going to refinance my home after graduation but that idea fell thru with the housing market. My husband co signed for me and has to work very hard when he should be retiring. I can’t find a job in my field and Iam not getting any younger. I got my masters in social work with the hopes of working with veterans after losing a son in Afghanistan. Now I could end up losing everything if something is not done. This has gotten so out of hand it is taking the life out of me. I feel that all my hard work was for nothing. I don’t even have a car to get out looking. This is taking away our quality of life at my age and my husbands it is traumatic.
Private loans are difficult at this time really get help with, but at the very least make sure your federal loans are in the best possible situation. There are many good programs that offer assistance for your federal loans.
I am in the same boat as all of you and just burst into tears reading everyone’s replies. It does help to know that I am not alone.
I have $100,000 in private loans with sallie Mae, Great Lakes, and discover student loans.
On top of that, I have $41,000 in federal loans with all of the above lenders.
I have applied for every single option out there. Wells Fargo, income based repayment, etc. NOTHING and no one can help me. I feel like there are loop holes lefty and right and this is a constant joke on me, and I just hear “no, I am sorry we can’t offer that to you.” My car was repossessed, my credit is terrible, and I really don’t even know how I am getting by.
I cannot get this burden off of me, and I am paying $1,440/month!!!!!! YES $1,440/month. I starve, and contemplate suicide everyday.
I call each of my lenders monthly to see if I qualify for any new offers or plans, but apparently I don’t. I am thankful to have a well paying job, but it all goes to my loans. I will never have children, never get married, never have a home if my own…..so why should I even be here anymore? I sadly ask myself that everyday, and everyday is a challenge to continue being in this world. Being this miserable and depressed is no way to live, and I feel for all of you. I really do.
If anyone has any help, advice, information, service lines, please contact me. I am all ears. Or it might be too late
Hi,
I am in the same situation as you..around 41,000-45000 in federal loan + 100,000 in private and incurring even more debt because school is not over.
I haven’t even begun to contemplate what this will mean for me in the future. I am nearing my late 30s and attended pharmacy school at a later period in life because I had trouble with grades earlier on.
Not married, no children live with my parents, and severe depression now because of the debt over my head and being unsure of my future in the pharmacy field. They say jobs are drying up and I am very worried.
Please don’t give up hope…If it makes you feel a little bit better..think of all the other people in your situation and their problems (like me). No matter what situation you are in, there is always someone in a worse situation who has gotten through.
I am in your same boat and am trying every day to hold on to something to look forward to other than the feeling of overwhelming debt…
Your immediate task now is not focus on the debt, but instead the enjoyment of your life…mentally and physically…through some spiritual guidance..friends..family members..
If you can get your soul out of debt first, maybe the rest will follow.
I’m disabled, no income, no SSDI, and I’m over $100,000 in debt. Sometimes I think my hopes and dreams are gone and that I should jump off a bridge. Then I see how many people are struggling with the same thing and I realized that WE are NOT to blame. It is the greedy banks and the government. I stopped paying my private loans and I pay federal loans on IBR with the help of a family member. But there is no more money for the private loans. I thought I was doing the right thing by going to college, getting a 3.75 GPA, all while raising 2 small children. They told me that I would get a good job and the student loans wouldn’t be that hard. I was young and foolish to listen to them. But they have cheated me and thousands of others across America. My solution: DON’T PAY!!! In European countries the people don’t put up with this garbage. They will riot in the streets over much less. What has happened to our spirit? We said no to the British because their government was denying us our rights. So why do we sit back and suffer while our government lets the banks destroy our lives by raising our interest rates, not telling us how much we would be paying when we graduated, and believing the college lies about a “wonderful job” complete with a family, a house with a white picket fence, and even a dog? We need to organize into a “Union” of some kind and refuse to pay. Most people don’t know that if you don’t make much and you live without luxuries, there is NOTHING for the banks to take. I stopped paying my private loans because I don’t have the money. I have to use what I have to feed my 2 children. When the gov. bailed out the banks, they should have given the money on behalf of the people that were in serious debt, bankruptcy, foreclosure, etc. The banks would have still gotten their money and we as U.S. citizens would be better off. Stop thinking that YOU are the problem. When I do that, it makes me depressed and suicidal. Why am I blaming myself for something that isn’t my fault. Why are you? I have decided to only pay what I can and forget the rest. I only answer phone calls if I know the number/person, to avoid the vultures. I am learning to appreciate what I have, to notice a sunset or smell the honeysuckle. When I stopped caring, I became free. If they sue me, they will send thousands in legal fees, and even if they win, you can’t get blood from a stone. Let them come. A few years ago, I was in Africa and I saw a boy in tattered clothes walking to get water with 2 big plastic bottles. He is happy to be fed, to be warm, and to be healthy. If he had over $100,000 in debt, it wouldn’t even mater to him. He doesn’t care if he can’t afford a car, or an iphone. He has his priorities straight. But here we are, caring what some stupid bank thinks of us and feeling like failures. We are good people that tried to do the right thing and then we were robbed. We need to notice the sunrise, the sound of the birds, and ignore the banks. If we all stopped paying them, what would they do? Even they can’t go after all of us. Stop paying them, let them crumble, and let us enjoy the REAL pleasures in life!
Tried going to art institute of Washington back in 05-06..opened up a couple private/federal loans with no family support..almost started my 2nd year and had to try and open another private/federal loan to only get denied and forced to drop out.
Could barely find any jobs so I had to defer my loans which sky rocketed the total loan..now I’m 4-5 years into a full time job that barely pays the bills let aloe having to lose majorit of my it to student loans
Ridiculous to me that you can’t be late on payments..they just hit you with next months payment as well as late fees
I’m at a total of $41,398 for less than 2 years of schooling..sweet deal right?
Hi, I am in this same situation with all of you. I have both federal and private loans along with medical bills but all of my lenders are responsive and works with you but the private loans. I am supposed to pay over 600 in federal loans every month and with this economy is so hard. I graduated in 2011 and have been unemployed since 2013 and they just do not work with you. My mother helped and is a consigner on 4 of my loans and tegu harass both of us all day, everyday. I would love to pay of my debts if I could but they make it so hard.
All of my federal student loans have been dismissed due to total disability. I have a private loan that not only am I not able to get any assistance with but much like my federal loans all I hear is ” we don’t know of any way or any assistance to deal with this’. I took care of, did all the research for, all the “leg work” for dismissal of federal loans after I was told there was no way to get them dismissed. This loan is a nightmare! I’ve been paying on it for two years now and owe $1,200 more than I did when I started paying! It has been sold to 2 different companies. The original servicer was recommended by Dept. of Education as well as the school site where I heard of them at. There are many, many complaints about this Leander on the web. Can’t one of you do SOMETHING???
I went to ITT TECH 08-10.. was told two weeks before graduating that I had to take a private loan or that I wouldn’t graduate. I feel not only cheated on my education, but also extorted into borrowing money. I had to take a loan of 10 K which is now with PEAKS private loans… I am almost disabled, working PT very intermittently. what should I do??l
My original 40,000$ loan is now $80,000 and rising. I have four kids and am on welfare. I have lost all hope. There are no real solutions at this point.
I’m on disability that won’t even cover my rent. had to drop out 2 semesters shy of graduating to boot. I feel about the same as you do. The only solution I have come up with so far is buy a house or whatever and consolidate this ridiculous loan into mortgage. If I could afford or even be considered for a mortgage because this loan puts my debt to income ratio too high to get one without a co-signer!!
Mother of 3 hanging by a thread as well. My original 60k loan is at 100k now. Was able to pay and hoping to even pay off early with the decent (not great) job I had before the economy tanked. Tried working with the lenders after my financial situation changed – wanted more than I made in a month and wouldn’t work with me (why would they without bankruptcy protections?). It seems like we’re all being punished for being poor. Even much of the proposed legislation only helps those who are current. Ten years of looking for an answer and not a step closer. There has to be a work around. I’ve lost faith that any answers are coming from the same gov. that stripped away the bankruptcy protections. Too bad our elected officials are beholden to corporations…
My loan with AES is unbelievable, never late doesnt even make a dent in my balance. They charge interest per day , something needs to be done
Same organization as mine… and I use the term ” organization” loosely! Maybe like a mob loan shark organization!!
I also had a loan through AES and now it is in default. It started with Chase and of course they sold it. I took a private loan out for 6k and it is now up to 13k and in default. They want me to settle for 8k and I totally would…only one problem….I have a defaulted status! No loan company will touch me, not without a co signer anyway and who wants to co sign for 13k? No one! Not when you come from a family who has no money,
I went to school for 5 years and got my degree and am now in grad school accuring more debt (federal loans thank god) but this loan company wants me to pay like 400 dollars a month for 7 years while the interest is almost 100 dollars a month all the while it stays in a defaulted status while I make the payments for the entire 7 years, which means I will never get a car (which I need because I am a home visitor social worker) or a house. I will have to throw my money away to renters and buy cheap ass cars that I have to pray will last me long enough to be able to get out of this debt.
They promise us an awesome life making a million dollars more than the average person in our life time if you have an education, if you just take out all these loans to pay for your education! What we dont understand going into our freshman year of college is that we are really setting ourselves up for failure and a huge debt to start out our lives!
I didnt think I would have a problem paying my loans off, because after all I was going to get an amazing job that I would love that would pay all my bills and no struggling! PLEASE!! Was I wrong!!! They paint a wonderful picture of how college will change your life, when all it really is, is a conspiracy to get the rich richer!!
I want nothing more than to have good credit but I dont think its ever going to happen because of these stupid private loans!! I am under water here with no where to turn! It haunts me!
Are there any solutions at all??!?!
Its a shame how student debt has taken over our lives. I took out a private student loan years ago and today the amount has almost tripled. All the interest they charge is ridiculous and impossible to pay. With in 2 months my total loan payment has been $1000 which is half of what I make after taxes and benefit payments.
They tell you that if you want a better life you should go and get educated. Then why don’t they make education affordable? Why aren’t there better paying jobs for those who get that education they said we needed to have to live this American dream that’s been advertised?
And don’t even get me started on those useless politicians in Congress these days who make more than their work warrants. I mean the average working person in America works 2080 + hours a year only to make 75k or less per year while these hacks work at doing nothing for 5 days a month and bring home over $175k on average.
Not to mention, a vast majority of those in congress who didn’t pass the Student Loan Forgiveness Act are from old money or are newly rich who have forgotten or never knew what it was like to take on huge debt just to chase the American dream of being in the upper middle class (which coincidentally in spite of education is fading away).
I’m not angry that they have money and probably no student debt. I’m angry that they don’t have the capability to get off of their high horses to understand that student debt exists and that it is an outstanding burden on the average person making 60k or less who bought into the dream but didn’t become doctors, lawyers, engineers, CEOs, politicians or hedge fund managers.
Too bad they aren’t paid by the ‘job’ i.e court time etc. as they were when their offices were originally started. as they
If this Student Loan Forgiveness Act is approved, how long will it be until we are able to take advantage of it? Like most others on this forum, I graduated and had a hard time finding a job. After making my loan payments on time for the first 1.5 years, I was no longer making enough money to pay my loans and rent/food. Do I live on the streets? No, I missed a few payments which turned into even larger bills and eventually was in WAY over my head. Now all of my private loans are in default and there is no sort of forgiveness whatsoever. I am more than happy to make payments, just wish these loans were a bit more understanding of life. I feel like they are the mob coming after me for not getting them their money. HELP!!!
I have pravite loan debt that I can’t get paid back either. I have a master degree working with my associate degree and making enough to just support my single mom family looks like the government would step in and help …….
Considering bankruptcy.
Help,,,,,,
Hayley bankruptcy will not help with student loans, the lenders are protected since there is no other form of collateral on a diploma. Just wanted to let you know before you go down that route only to find out nothing happened with your student loans.
I have over $200,000.00 of private education loan, I am working in the public sector but since all my loans are private AES and Sallie Mae loans I am completely drowned in debt. Highly educated and have a job but can’t even afford a house. What are my options? Please help.
I completely sympathize, as I had a private school education where I took out private loans and am looking at about $130,000 to repay. I am highly qualified and certified in a field that has reasonable demand, but I still struggle to find a job relevant to my degree. I borrowed and spent all that money to go to a good school with a name that should ring desirable to employers. I worked incredibly hard in school and had literally no choice but to defer on payments and interest, due to my parents putting my brother and sister through college as well. Choosing deferment allowed me to focus fully on school, take classes full time, and finish my degree in a timely manner, reducing the overall cost of university and my marketability in the job market. I look back and cannot imagine how I could have finished school at the high level I did and held a paying job (other than my odd tutoring and babysitting). Maybe classes were only 5 days a week, but to a serious full-time student, school is a full-time, 7-day-a-week job. Any job that could have covered my loan payments would have a) been impossible to fit into my schedule and b) even if I had managed to squeeze in graveyard shifts, it would have completely compromised my academic performance- something I’m not willing to do when I’m at school to do my best work. If you don’t do your best and shine at a private college like I went to, good luck getting letters of recommendation- or your degree at all, for that matter. If didn’t maintain a certain GPA, I could have been booted from my program. I already struggled to keep my head above water, even without working part-time. Any work I did was over summers, and even then, that barely seemed to cover the cost of books and other implements I needed during the upcoming semester.
My credit was virtually nonexistent before college and I needed a cosigner to get my loans. I am now graduated and work full time (in a job unrelated to my field) and I pay all my loans on time, by myself, with no help from anyone, but I still want to take my cosigner off my loans so their own credit is flexible again. I have always viewed as my loans as my responsibility, something they will never have to worry about, something that will never touch them (and I keep to that). Guess what? Since my income is low and my credit history is short and unbuildable (what bank is going to give me a credit card on my low income and low credit- see how this trap gets more and more twisted?), it is unlikely my cosigner will be removed from my loans any time soon- although I will persist in my efforts to see it done.
I do applaud the people who put themselves through college, paid and worked as they went, and I am jealous of those who have their backs covered and supported by federal student loans and the options provided to them if they want to do something great for the world like the Peace Corps or teaching abroad (which I desperately want to do but know it is outside the realm of possibility, given my current financial situation). But some of us work too hard in school to work during college- especially if you are involved in field placements, research, and resume-bolstering extra-curricular activities that make your resume shine. I have read comments on other articles where parents and students have “zero sympathy” for private loan borrowers such as myself, thinking we frittered the checks away on partying, cars, and other extras. Clearly they have not met someone in my situation who spent 4.5 years at university and worked my ass off so I could graduate with the accolades necessary to get a great job, pay off my debt to society and the bank, and work my way up in the world- and the path to doing that involved ridiculous tuition costs that required me to borrow unfathomable quantities of money from greedy and inflexible banks that do not make allowances or wiggle room for honest, working (even in a crap job), paying borrowers, who are earnest in their quest to repay and are stuck in a complete financial rut. Ron Swanson said it best in his Parks and Rec line: “I do not trust big banks, I do not trust small banks. Banks are Ponzi schemes run by morons.”
While I do not expect the government, my bank, or anybody else to solve my problems for me- I am still job-searching and figuring out ways to boost my credit as I deal with this uncomfortable and unstable situation- nothing angers me more than seeing/hearing comments from people who have “no sympathy” for borrowers like us. While I imagine there are lazy and irresponsible students who default on their loans after graduation and just do not have the drive to get a job and become financially independent, they should know the multi-billion dollar private loan crisis is a very real struggle for self-starters and highly qualified individuals such as myself who are facing a struggling economy, pathetic excuse for a job market, and cannot build a life for themselves. I want to pay my loans. I want to find and keep a great job. I want to take responsibility and not be afraid of what my future holds. And it pains me to think that I might never be a homeowner, won’t be able to financially support the children I would someday like to have, and won’t be able to afford nice things in life like vacations or going out to eat. I literally dread what’s ahead when my full intention was to climb the ladder that was set before me. I put in the work, I climbed the ladder, and now I am being shoved off.
It’s not our fault we were promised a fantastic education that would open doors leading to a promising future. I think people should have sympathy for us. I can’t predict the future, and I would not have signed onto college and borrowed all that money if I knew my hard work would not pay off and I would be in this predicament. I am responsible and I am getting screwed.
Even if you could afford the house your debt to income ratio due to those loans current or not would keep you from it or make you high risk and hard to get financing.
I hope something good turns out. I finished consolidating all my student loans and just recently received notification of a private loan of $20, 000.00 going to 34, 000.00 at 15.75 %. I tried negotiating with them to modify payment but thye wouldn’t budge and facing close to $1,000.00 a moth just in loans. There is just no way…..Federal loans provide re-payment options, private sector there are just milking fresh graduates without any jobs or enough income to be able to pay. All they offer is a small deferment for 3 months and an increase on your monthly payment. Peaks loans is just or worst than credit card companies. Please there has to be other ways…..need desperate help!!!!!!!!!
Rachel, I am in the same boat as you. When I received my private loans a few years ago, I had completely exhausted all of my federal loans and I had no other choice but to take out the private loans if I wanted to finish school. I only had one more year to go and after having so much success in school, I really didn’t have a choice if I wanted to finish school and make something of my future. At the time, my credit was not so good and I had a very high interest rate on the loans. I did graduate and then the private loan sharks came after me. I pay close to $400 a month in private student loan repayments and $400 in federal student loan repayments. I was able to consolidate my federal student loans and lower the payments but my private lenders were completely unwilling to work with me on trying to refinance or consolidate. I have raised my credit score considerably the past few years in an effort to be financially responsible. I had hoped that the private lenders would be willing to work with me and allow me to refinance at a lower interest rate. I was wrong. They would not budge whatsoever, would not work with me on adjusting repayment options, nothing….. Their answer was repay at our terms or face the consequences. Seriously. These guys are worse than the Mafia and loan sharks. I’ll admit. Without their assistance, I wouldn’t have been able to graduate. But the price I now have to pay seems almost not worth it. I wish to God that I had taken the time to explore more options when my financial aid advisers told me to get the private loans. Come to think about it, it would not be a surprise to me at all if we found out that some financial aid workers were being paid to pressure ignorant students into taking private loans.
I seriously hope some relief is coming in the future. I am drowning in student loan debt.
Have there been any recent updates in regards to the pending bills? I am also drowning in student loan debt and struggling to provide for my daughter due to the $700/mo payments. I agree something has to be done, and quick!
Hello megh. We are trying to raise awareness for the student loan fairness act. The issue is really a large one that at some point will need to be addressed by congress. The limiting factor is simply the people standing up and demanding a change with private student loan legislation.
I am assuming your loans are private, right? If they are federal i hope you have taken a look at the options available to you.
My daughter and her best friend have student loans through Discover bank. Both loans are in default and Discover Bank refuses to defer, offer any income based credit program or even offer a program to keep the interest rate and increase length of payment. my mother (who has since passed away) cosigned for the loans in good faith and the bank pressured her into making monthly payments that she could not afford. Now my family is facing the possiblility of discover coming after her estate. They have been completely unwilling to negotiate. We have qualified my daughter for the government income based program and her even Wells Fargo who hold her other loans offers a program and has willingly negotiated deferment plans. How does Discover get away with being so unreasonable. Can you offer any suggestions? Kindest regards, Deems Palmer
Hello Deems,
Sorry to hear about your situation it can be daunting trying to work out a plan with private lenders. On March 21st 2013 there was a new bill introduced called the Student Loan Fairness Act. Its a combination between the Student Loan Forgiveness Act (which did not pass) and the The Graduate Success Act. One of the main points, which will help MANY borrowers including yourself, is the ability to convert private student loans into federal student loans. It may seem like a long shot, but its worth trying to get behind the bill. You are not alone with your issues, we have people calling us on a daily basis looking for solutions for the Private Student Loans.
Eventually we will hit the boiling point where these private student loans will need to be addressed with solutions and programs to parallel what the federal loan programs can offer. I dont think it will be too far out, keep your eyes and ears open. Once there are solutions the private lenders will start to bend over backwards to keep your loans and will be more than happy to accommodate your difficult situation, though its unfortunate that only then will they seem to ‘care’ about you. Good luck!
I have both a Federal and a private student loan. Due to disability, I was able to meet the criteria to have my Federal loan discharged. Do you think it might be possible to convert my private loan to a Federal loan and also have it discharged?
This is not possible Shar, you cannot convert private loans into federal at this time. Unless the federal government comes out with a program where they buy private debt, it wont happen. Seems very very unlikely.
If the co-signer agreed to pay the loan while in default and the co-signer is deceased it is fair that the estate of the deceased pay off the loan
Sounds like someone works for Discover Bank.