Student loan | I brushed my <b>student loans</b> under the rug when I graduated from <b>...</b> |
- I brushed my <b>student loans</b> under the rug when I graduated from <b>...</b>
- Obama's $1.2 Trillion <b>Student Loan</b> Program Is Falling Apart <b>...</b>
- <b>Student Loans</b> Company is hounding me for debt I paid off in 2009 <b>...</b>
- Sallie mae spinoff navient could face cfpb lawsuit over <b>student loans</b>
- Collective <b>student loan</b> debt altering entire U.S. economy | KHON2
- The high economic and social costs of <b>student loan</b> debt - CNBC.com
| I brushed my <b>student loans</b> under the rug when I graduated from <b>...</b> Posted: 24 Aug 2015 07:12 AM PDT  Kristin BastianKristin Bastian.When I was wait-listed at my first choice college, I enrolled in a tech school. I qualified for a Pell grant and received state lottery assistance, so I only spent $250-$300 per semester. When I transferred to the College of Charleston in 2005, I assumed I'd be granted a full scholarship, thanks to my strong GPA and SAT scores. But after meeting with the financial aid office, I was floored to learn I was fully responsible for my tuition. My mom took out a loan for me the first year, which she defaulted on. The following year I was offered a $10,000 federal loan — even though my tuition was only $4,000 a semester, and I lived at home and didn't participate in the meal plan. The financial aid department assured me that I wouldn't have to pay it back for a long time, so I figured it couldn't hurt to have extra cash. The Road to Default … When I graduated in 2009, I owed $26,500 and my monthly payments were $200. The job market was dismal, so I waited tables. I'd had a baby in 2008, and my partner had lost his job. We were just squeaking by, so my student loans dropped to the bottom of the priority list. Part of me knew I should try to get a deferment or forbearance, but I felt like I was already so far behind that it was pointless — and I didn't want to make an embarrassing phone call. Instead, I pretended my student loans didn't exist. In 2010 I landed a temp job for a nonprofit personal finance and housing counseling service. I moved up quickly and was hired full-time — ironically, as a money management counselor — with a salary of $28,000. Even so, I was barely making ends meet — and kept ignoring my loans. I had just separated from my son's father, so I was a single mother. My wake-up call? When my HR manager had to tell me that a collection agency was threatening to garnish my wages and withhold tax refunds. I was forced to sort things out — and it wasn't pretty. My credit score was in ruins (435), and with penalties and accrued interest, I owed significantly more than $26,500 on my student loans.
My Post-Default Plan … I entered a debt rehabilitation program, which had me making nine consecutive monthly payments of $245. It was a real struggle. I was living on ramen, and had to go to a payday lender to cover my son's day care. I accumulated $500 in interest, but once I completed the program, the penalty fees were removed, my loans reverted to a current status, and the default was erased from my credit report. To keep my good standing, I applied for an income-based repayment plan, which lowered my monthly payments to $20.98. I remember the exact amount because I was so relieved! My credit score is now at 650, and I've been able to open a credit card. I pay $230 a month toward my loans, which I can afford, because I earn more and I'm married. When I first landed in debt, I was so naive. I'll never again brush things under the rug, because I've seen that it will come back to bite me much worse than if I'd faced the situation head-on. RELATED: From 0 to 800: 3 Stories of People Who Rebuilt Their Bad Credit Scores Kristin Bastian, 29, is a financial education manager in North Charleston, South Carolina. This post was excerpted from "3 Grads Confess: 'I Defaulted on My Student Loans. Here's My Story'," originally published on LearnVest.  |
| Obama's $1.2 Trillion <b>Student Loan</b> Program Is Falling Apart <b>...</b> Posted: 24 Aug 2015 03:57 PM PDT Debt Crisis: In less than five years, President Obama turned a relatively small, privately run, guaranteed student-loan program into a massive government-run disaster. What's his answer? More government, naturally. The latest figures on the government-run loan program should be worrisome to anyone who cares about fiscal sanity and economic growth. Delinquency rates on the feds' $1.2 trillion of student loans are sky high — worse than mortgage loans during the housing crisis. The New York Fed reports that 11.5% of student loan debt was more than three months past due in Q2 of this year, which was up from Q1. By comparison, the 90-day delinquency rate on credit card debt is just 8.4%. The St. Louis Fed says that 27.3% of student loans that are currently being repaid are at least a month behind. Now comes word from the Department of Education that 6.9 million people haven't made a student loan payment in more than 360 days, which is up 6% from the year before. And this comes at a time when the economy and the job market have improved, and when more and more students are taking advantage of Obama's ridiculously easy student loan repayment plans. In fact, enrollment in income-based loan programs — which base monthly payments on current income and forgive any remaining debt after 20 years — exploded 56% in just the past year. This debt crisis is entirely of President Obama's making. In 2010, Obama signed a law federalizing the student loan program, claiming that the banks were needless middlemen and that the government could just lend the money directly and save truckloads of money. It never worked out that way. Experts say that the Education Department is ill-equipped to identify risks when making loans. Easy terms and high default rates forced the Congressional Budget Office recently to increase the program's cost by 7 billion — a 30% jump. And the risk of another financial crisis looms as the amount of direct federal student loan debt has climbed more than 600%. The Department of Education now manages a loan portfolio bigger than the entire loan business of JPMorgan Chase. But rather than rein in this program, Obama is instead targeting private loan servicing companies that contract with the government to collect the loans for what he calls overly aggressive tactics. This is typical of liberals. If a government program isn't working, the answer is always more government, never less. Connect with IBD Editorials: @IBDeditorials and Facebook |
| <b>Student Loans</b> Company is hounding me for debt I paid off in 2009 <b>...</b> Posted: 26 Aug 2015 11:00 PM PDT Student Loans Company got in touch six years after it said debt was paid off. Photograph: Alamy I took out a student loan in 2002 and early in 2009 the Student Loans Company informed me that I had made all payments and stopped deducting money from my wages. Suddenly this year I got a call from a man saying he worked at SLC. He told me I had underpaid by £80 and asked if he could take the payment. It seemed a bit fishy so I declined. Last month, I got an email from SLC saying that in 2009 the debt was miscalculated and I owed £83, to which it has added £6 interest. I am astounded as I never asked to stop the payments; this miscalculation is SLC's mistake. I queried the "six-year life of debt" rule but apparently as it is a government agency this is irrelevant. It has had my current address, yet has only just got in contact. When I declined this payment it told me it would come out of my wage the next month. I don't have the paperwork to check this debt and SLC hasn't sent me a breakdown of what I owe. SM Biggleswade, Bedfordshire It is, of course, all your fault, according to SLC, which says the amount you declared you had repaid in 2009 didn't tally with HM Revenue & Customs figures. Thus the £83 shortfall. This is all very odd. The payments were deducted from your salary by your employer and sent to HMRC which, at the end of each tax year, updated SLC with the balance. So why didn't SLC wait for such an update before stopping further deductions? SLC says that, having predicted that your loan would be repaid in July 2009 based on figures you provided, it didn't want to deplete your wage packet more than it needed to. The six-year delay in contacting you was because you moved house and didn't notify SLC since you thought the loan was paid off. Magnanimously, since it now acknowledges the time lapse is "inconvenient" it has agreed to credit your account with the £6 interest, but it remains intransigent about the rest. "We appreciate the frustration at being asked to repay this balance … but SLC administers public funds and has a duty to collect all monies owed," says a spokesperson. If you need help email Anna Tims at your.problems@observer.co.uk or write to Your Problems, The Observer, Kings Place, 90 York Way, London N1 9GU. Include an address and phone number. |
| Sallie mae spinoff navient could face cfpb lawsuit over <b>student loans</b> Posted: 25 Aug 2015 08:06 AM PDT
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| Collective <b>student loan</b> debt altering entire U.S. economy | KHON2 Posted: 22 Aug 2015 12:36 PM PDT (CNN) — Millions of students are set to head to college campuses, and as many well know, that education comes with a hefty price tag. As the nation's collective student loan debt climbs further past the $1 trillion mark, students aren't the only ones feeling the burden. That debt is altering the entire U.S. economy, for all of us. "I'm 19 going on 20," said college student Emily Vo, "and I already owe $30,000. I can't explain it. If you're not in debt, it's a hard feeling to understand, so it is very emotional." Vo chose in-state tuition over a private school, cut spending to a minimum, and she's working full-time this summer at a doctor's office. But it's probably not enough. "Most parents and students think they'll be paying off student loans for 5-10 years," said Mary Morris, College Savings Foundation President. "The reality is it's probably a lot longer than that." Morris said those first years off-campus can be different with debt. "No matter how much that is, it's a bit of a struggle when you first get started. They have to delay, sometimes, buying a home, getting married, having children." Young people first feel the effects of that student debt while on campus, cutting back on things like vacations and study abroad. But, like the debt, the mindset appears to be having more of a carry-over after graduation. Anthony Carnevale of the Georgetown University Center on Education and the Workforce said that "students are having to take longer and longer to reach a phase when they can be truly independent," and that extended time has reshaped the entire U.S. economy. "It distorts their own lives," he said. "It creates distortions in the economy and reduces growth because they're inhibited from going because they're afraid of debt. They're debt-averse." A recent survey by Bankrate found student loans delaying millennials from buying homes, saving for retirement and purchasing cars, and a recent study by the Pew Research Foundation shows more millennials are living with their parents than five years ago, despite a drop in the millennial unemployment rate and a rise in their earnings. Vo said her friends remind themselves to "stay strong. You're going to college for a good reason: to get an education. A lot of people don't get that chance." Despite the debt, she's set up a savings account, putting a little bit towards a financial future. |
| The high economic and social costs of <b>student loan</b> debt - CNBC.com Posted: 15 Jun 2015 07:39 AM PDT Rising student debt levels are changing how millions of people approach major milestones and core financial decisions, affecting longstanding social and economic patterns. Consider homeownership. Owning a home used to be a key marker of adulthood and maturity. But homeownership has plummeted among Americans under age 35, from 43.3 percent in the first quarter of 2005 to 34.6 percent in first quarter of 2015, according to the Census Bureau. Mortgage lenders "look at all debt obligations, and student debt would count toward that, which means the person...has to downgrade their housing expectations, and take out a loan lower than what they intended. Or in some cases, they say, 'Well, I'm going to hold back,'" said Lawrence Yun, chief economist of the National Association of Realtors. The association found in a recent survey that 23 percent of first-time buyers said it was hard for them to save for a down payment, and within that group, 57 percent said student debt was impeding their saving, up from 54 percent a year earlier. Read MoreWho's hiring 2015 college graduates? While a college education generally leads to higher income, "growing student loan burdens can have direct impacts in terms of lost sales due to higher debt levels for builders focusing on the entry level market space," said Robert Dietz, an economist with the National Association of Home Builders. Twenty-somethings are also putting off starting a family. The median age for a first birth has been increasing for years, standing most recently at age 26. And the birth rate among women aged 20 to 29 is now at a record low, and has been declining since at least 2008, according to data from the Centers for Disease Control. Students laboring under the burden of student debt are also following different career paths, with important social implications. The need to repay loans is steering some away from professions like social work and health care and toward higher-paying jobs in tech and financial services. In a working paper for the National Bureau of Economic Research, the writers examined the effect of a move by a selective college to replace loans with grants. "We find that debt causes graduates to choose substantially higher-salary jobs and reduces the probability that students choose relatively low-paying 'public interest' jobs," the researchers observed. While choosing a higher-paying field may help them repay their loans faster, it could also result in fewer graduates moving into low-paying but critical jobs like early childhood education. Read MoreHow not to drown in student loan debt Research has also found that the burden of student debt hinders innovation and entrepreneurship, a core component of the economic prowess of the United States. Researchers at the Federal Reserve Bank of Philadelphia and Pennsylvania State studied the relationship between student debt and small business formation and found "a significant and economically meaningful" link: more student debt led to fewer small businesses being formed. Student loan defaults are another burden on society. The three-year default rate stands at roughly 13.7, and the average amount in default per borrower was just over $14,000 in the third quarter of 2014. Debt like that impedes the ability of borrowers to save for retirement at a time when millions of Americans are short on retirement savings. And it can have a ripple effect on the economy, in part because the federal government typically does not recoup the full amount in default (though it does get most, eventually). "We're not going to see this create systemic risk," said Rohit Chopra, student loan ombudsman and assistant director at the Consumer Financial Protection Bureau, since the government either guarantees or owns most of the student loans and has the power to sue and to garnish wages, tax refunds, and federal benefits like Social Security when borrowers default. "But it will create economic drag if it's unaddressed,"he added. While some, like Mark Kantrowitz, a student financial aid policy expert and publisher of Edvisors.com, argue that student loans have not reached the level of "crisis," most policymakers and experts agree that the trends are worrisome at the least and more should be done to ease the burden on borrowers. Kantrowitz advocates for more programs to improve the financial literacy and budgeting skills of students and their parents, as well as better disclosures for student loans. "We need to bring some sanity back to the system," he said. |
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