I am a Nurse Practitioner who is vey very concerned about my daughters mental health -as a result of her student loans....We had NO IDEA -what a nightmare this would become:-(. She has had at least 2 jobs since she was 11 yrs old...Harding working is an understatement !!
She is so depressed and dejected over her inability to keep her head above water she is now considering have a permanent surgical procedure to prevent pregnancy !!! She is just 27 !!
This pushed me over the edge..... I am just heartsick for her ....She borrowed $35,000 total in private loans between 2005-2007... Due to the fact she had as we filed Bankruptcy nearly 7 yrs before due to illness- my husband and I have always worked at least 1 full time job each as well... How is this happening in our country?
CEO's and wealthy Wall Street Bankers get off Scott free?? Really ??? While at least now 1-2 GENERATIONS of our kids have no work and and are penalized with unfair and downright immoral banking practices?? Really?? I am speechless and disgusted and losing sleep over this. I am very sure there are thousands and thousands of others struggling too. She does NOT want to file bankruptcy - she want to pay what she owes...she is a good kid...
My daughter borrowed $35,000 in PRIVATE school loans..She has paid at least $15,000 back-yet her total debt is now >$45,000!!!! How can this happen??? She has to pay $150.00 to even ask for forbearance..like when in hospital for surgery and unable to work ( as a waitress) because her BFA has not provided any increased opportunity for work in her field ...she has struggled for 7 years- living in abject poverty under the weight of this loan system.
Her Federal loans have not been an issue and are up to date. I want to help her....how can I negotiate a fair settlement ?? She has been told by Sallie Mae "too bad- no options left" They did not allow consolidation...allow 2?? Forbearance in the life time of the loan...I read the small print yesterday as to how they "compute" the debt...it made me literally physically sick."
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You remember all those years people kept assuming private student loans were "good debt" and a smart thing to do. Well they never were. I've been warning people about student loan debt going on 15 years now. Back when things were moving along briskly with the economy nobody wanted to listen to those warnings.
Student loan debt is just debt. If you take on more than you can handle then there is no way you'll ever be able to repay the debt.
One comment that smacked me right between the eyes was your statement, "She does NOT want to file bankruptcy - she want to pay what she owes...she is a good kid..." That's the absolute wrong way to look at the situation.
Bankruptcy is not a morally vacant decision. And while some of her debt may be eliminated, it also means some of her life may be regained.
Bankruptcy is not a moral decision, it is a business decision. Companies make these types of calculated decision every day, so how can it be immoral or wrong for her to consider such an options based on her life situation?
Before you keep maintaining this incorrect thinking you absolutely must read this article to start weighing options carefully.
Starting with the assumption that some sort of debt intervention is not a good thing is like having a patient walk in and say antibiotics are immoral. Both things, bankruptcy and antibiotics are tools to use to fix the greater problem and help heal the person.
There are certainly some options for dealing with the private student loans, even in bankruptcy. Read my research here.
At the very least we need to start with an approach where she evaluates the total amount of her debt, consider what can be easily eliminated in bankruptcy to then focus on the private student loans, make sure she is in the right program for her federal loans, and then consider what legal intervention may be possible to further eliminate or reduce her private student loans. The two of you should go and talk to a local bankruptcy attorney about your options.
While I have been seeing more settlement offers coming from Salle Mae I have not seen any great offers when proposed by consumers. If Sallie Mae sends an offer it is typically going to be for about 50% of the balance.
And you want to know why the private student loans lenders can get away with this, it's because it was all laid out in the fine print of the loan that millions of people voluntarily agreed to. As you noticed, when you read the fine print, it's all right there.
One more thing to do, get your daughter into treatment for her depression as fast as possible. We need to attack this on all fronts.
Please post your responses and follow-up messages to me on this in the comments section below.
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