I made some mistakes while going to school. I used my credit cards to pay for materials and equipment while going to school and racked up a lot of debt.
We deferred my loans originally in hoped of paying off the credit cards. That didn't work and finally we had to claim bankruptcy almost 3 years ago. We have been paying both after that and before that no problem.
I worked in the film and games industry for 7 years and lost my job about 7 months ago. We had to move back in with my parents at 42 years old. My wife makes a minimum amount of money and I am about to run out of what little I get from unemployment at this point.
I have been unable to pay my student loans because of this situation. My federal are fine because they let me do an unemployment deferment. My Sallie Mae student loans are private and the company has been unrelenting. We have talked to them, told them our situation but they are still demanding money.
They are telling us they want 600 a month but we just don't have it. They call 3 - 4 times a day. They are threatening to send it to collections and then garnish my and my wife's (who is my co-signer) wages.
What can we do if anything? Any help would be appreciated!
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You are correct in observing the private student loans offer far less in the way of repayment options. At least with federal loans you have options to easily consolidate or get a payment as low as $0 per month.
With the Sallie Mae loans you have a few options to consider if you just can't afford the contractual payment. But one option is bankruptcy. It might be worth talking to a bankruptcy attorney about your options there. Sallie Mae loans do get discharged or reduced in bankruptcy sometimes. Most people just don't try.
You can always just stop paying and face the collection pressure and possible suit. But Sallie Mae also seems to be settling more delinquent debt for about half of what people owe. If you have access to cash to pay the settlement then it is worth considering. Keep in mind this approach can negatively impact your credit report and cause them to add penalties to the balance.
And with a co-signer, Sallie Mae can certainly go after the co-signer for payment, including suing and trying for a wage garnishment.
But isn't the reality that you just simply can't pay what you can't afford? All of this pressure and worry is holding you back from being able to move forward with your life in a productive way. The depression and emotional struggle everyone goes through in situations like this just seems to leave them feeling hopeless and unable to tackle the future. And that's not helpful.
The ultimate solution is going to be one that either allows you to resolve the debt one way or another or allow you to find a way to not live in fear of demands for money you just can't afford to pay. You will find that once you can live in less fear from this debt that new opportunities will open before you.
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