Real Life Stories

“In order to fulfill my dream to teach online college courses as my next career – I began my BA journey in November 2008. By the end of this year I will have both a BA in Organizational Management and a MAEd in Higher Education. Did I mention I’ll have graduated with both degrees Summa Cum Laude? Did I mention I’ll be 60 years old when I receive my MAEd? Instead of being able to thrive and survive in a new teaching career in 2014 – I’ll be burdened with student loan payments with 6+% rates. The government moved heaven and earth to save the banking industry because they messed up the first American Dream: buying a home. Now we have to collaborate to rescue the second American dream: a college education. We’re not asking to wipe out the debt for us – we’re asking for a financial repayment interest rate lock so we have a fair chance to clear our debt while sustaining our lifestyle – not sacrificing everything we’ve worked so hard to build.”

- Longmont, CO

“I received student loans through both my bacehlor’s and master’s in education at the age of 18. Being the first in my family to go to oollege, I depended on the school representatives to guide me through the process. Boy was that a mistake. I received checks each semester that they insisted was my money to use to buy books and live… I know know that those were excess funds didn’t need for my education and should have been advised to send them back to the lender, but no one told me that then. I was never told that there was a maximum amount of loans you could receive through the federal government and thought that all but a few of my loans were federal… boy was I wrong. I now have a total of $225,000 in student debt, the majority of which is through private loans which are not required to assist students the way federal loans do. I am out of deferment and forbearance time as being a teacher in an inner-city school district didn’t provide me with the funds necessary to pay them back. I am now expected to start making $430 payments in June and have no idea how I am going to do it as I am lucky to have grocery money after all my bills are paid. I have been losing sleep over this and spend a lot of time crying because I am beyond stressed by this situation. Something needs to be done for those of us who were misadvised and misled!”

- Jennifer S., Phoenix. AZ

“I am writing concerning my loan through Sallie Mae; this account is a Spousal Consolidation loan with my ex-husband. As you may know, From January 1, 1993 to June 30, 2006, married borrowers could consolidate their federal loans together into a single loan. This loan was referred to as a joint consolidation loan. Each borrower assumed full responsibility for repaying the joint consolidation loan. The statutory language concerning joint consolidation loans was added by the Higher Education Amendments of 1992. Unfortunately, there was no provision in this legislation for splitting a joint consolidation loan when the borrowers got divorced. Thus joint consolidation loans became a tie that binds beyond divorce. If one ex-spouse failed to make his or her share of the joint payment, the other ex-spouse would be forced to make the full payment or risk ruining the credit scores of both borrowers by defaulting on the joint loan. To prevent more borrowers from experiencing this problem, the provision for joint consolidation loans was repealed by the Higher Education Reconciliation Act of 2005 (part of the Deficit Reduction Act of 2005). Unfortunately, there are still some borrowers who have joint consolidation loans. Congress did not provide any solutions for borrowers who are stuck with a joint consolidation loan. As a result, myself and others, have inherited nothing short of a nightmare. My loan with my ex-husband has accrued well over $225K just in interest and fees. Dealing with Sallie Mae has been nothing short of a nightmare. My ex-husband has been unemployed three times since graduation. For years before the Income Based Repayment came into play we took high interest forbearances while he was unemployed/underemployed because it was the only way to address the high loan payment on a single income. Forms get rejected for “missing data” despite the fact that everything is filled out completely. Often we have to submit the same forms 3 and 4 times before they get processed. I have come to the conclusion this is done to charge more interest and fees.”

- Dallas B.

“I’m speaking for what I’ve seen with my daughter. Short facts: The private institutions do not supply the contracted interest rate until after you have signed, contracted and received the check. The compounded interest is ridiculous as the rates are as high as 9 and 11%. When requesting to consolidate the rate was 8% with a cap of 11%. My daughter wants to pay her full contracted loan amount but as a new graduate with an entry level salary it would be much easier or even realistic with a 2.5% to 4% interest rate. Even her government loans are as high as 6.8%. In today’s market, the cost of higher education needs to be contained and we need to make it more affordable for all, whether it be controlling the high cost or providing better pay back options. Also, my daughter called one private lender and requested a lower interest rate based on her salary, the response was that they could not negotiate on the contracted interest rate and suggested that if she couldn’t pay the required monthly payment she would have to default on her loan. “

- Angela P. IL.

“I come from small town USA, population 250 or something close to that. I’ve always aspired for bigger and better things. I took a very unique route with my grade 7-12 education, homeschooling myself for the majority of those years. Immediately after getting my high school diploma (a day after I turned 16), I started working retail. Boy did that suck. I worked retail about a year and I decided I’d had enough. I have always been passionate about music and business so it was a no brainier for me, I needed to go to Full Sail. I obviously didn’t come from money so private loans were pretty much my only hope. I had to borrow nearly $110,000 in private loans and my monthly payments are now nearly $1200, and that’s not counting my federal loans, which are almost paid off (were only a few thousand dollars). What’s sad about this picture is that $110k will compound and turn into almost $400,000 by Sallie Mae’s projected pay off date. This led me to the realization that student loans were designed to keep us indebted to the system. Let young people borrow large amounts of money for an education that could otherwise be obtained for FREE on the internet (self research, self study, just like my homeschooling from grades 7-12). I am now forever indebted to the system, still living on ramen noodles and trying to build a successful business on my own with no help. I can’t take out more loans because the student loan debt destroyed my credit rating… I have no one to help me take make it financially possible. I understand, it was my choice to go to college, I didn’t have to go. But if I hadn’t, I would have never left small town USA and I would have never been in an environment where my skills and talents are in high demand. My student loan debt has perpetuated into more financial problems in other areas of my life. Although I was immediately employed after graduating from college, I have been living paycheck to paycheck with student loans that take up over a third of my monthly income. I was unable to pay the IRS (as I was a 1099 sub contractor), so now I owe the IRS about $40,000 that I can’t afford to pay them. The hole just keeps getting deeper and deeper. I’m still fighting to get above the water but it feels like there’s no end in sight. It seems our government takes care of people who can’t help themselves (EBT, welfare, minority grants, etc) and screws people who are actually productive and actively contributing to society. It should be the other way around, the active and productive people should get the assistance they need and the counter productive leaches should get NOTHING. This is just my story, I’m sure it resonates with many others. I hope we are able to make way with the student loan forgiveness act, but doesn’t seem like it’s going to happen any time soon.”

- Justin S. Orlando, Florida

“I borrowed original principle of 81,000 for a bachelor’s and master’s degree, and now owe 121,000 due to capitalizing interest due to a series of forbearance and deferments. I felt I had no real choice but to go to college being a divorced mother of two, with a disabled child, no child support, a car that broke down every time I turned around, very limited family support,and working for $7 per hour as a secretary. I did the best I could with what I had to work with, trying to do the right thing. Seems what I thought was the right thing -was wrong after-all because my student loan debt will outlive me. Given this, I have decided I will pay what I can to stay out of default; otherwise, I see no sense in throwing good money after bad as the student loan debt will stand regardless until they throw dirt onto my coffin. I have had this crazy idea that college should be affordable to all who want to go, that it would be better for all (myself, my children, and society) not to be “welfare witch” or to otherwise live in poverty as opposed to being a contributing, productive member of society. Shame on me for my stupidity. The US student loan system with all its predatory practices can kiss my a**. I’m done with it and refuse to worry anymore with it. “

- Donna

“I was the first in my family to go to college. My teachers, guidance counselor, friends and relatives were all urging me to follow my dreams. The cost didn’t seem to matter because no one bothered educating me about student loans. I was guided to a for-profit school that made lavish promises I didn’t realize were too good to be true. I didn’t know the difference between federal and private student loans, nor did my father who urged me to keep going, as if cost did not matter. The Art Institutes financial aid department guided me towards private loans before I even touched federal loans. I also didn’t know they were gaining interest while I was attending. AI conveniently didn’t include housing and supplies in their $56,000 cost of attendance figure they gave me when I signed up. I ended up taking out about $79,000 for my degree. My student loans paid for tuition, housing, books and supplies. I didn’t drink or party or go vacation somewhere exotic on Spring break. I didn’t use the money to purchase expensive cars or electronics. I worked part-time all throughout my attendance and paid for food and transportation on my own. I also received about $17,000 in grants and scholarships. When lured in to the school, I was expecting to make $50,000 in my field. Just before graduation they give you the real figures. Previous graduates were making less than $27,000 annually. It was a shock to everyone in my area of study. How were we going to pay our $60,000+ student loans back on that salary? Six months after graduating, still jobless, I entered repayment. That $17,000 I gained in scholarships and grants was flushed down the toilet as that was the same amount of interest that was capitalized, making my total student loan debt $96,000. I graduated in 2009 and aside from a few freelance gigs and “work for free to gain experience” opportunities that AI urged me to do, I haven’t worked in my field. I’ve paid about $13,000 on my loans and still owe $95,890. Sticking to Sallie Mae’s payment plan will have me paying more than triple what I originally borrowed! Going to college uneducated about student loans was the biggest mistake of my life!”

- Kasey, Chesapeake, VA

“I lived in WI all my life except for college. Now, my wife and I live in KCMO! I did not do the suvey because I thought you might have one for KC. I will tell you yes SL’s are way out of wack. Long story short, btwn my wife and I we borrowed $26,000. I made $5-6/hr. first 6 years out of college, while I had to pay for rent, childcare, and expenses. By the time I got a job paying a “living wage” (barely), the loan interest was way out of control and my good job was threatened by debt collectors threatening to send the sheriff to my work, calling my work, and intimidation such as “welfare mothers pay more than you!” Well, we filed a chapter 13 to (freeze interest), reorganize and be “responsible” by paying a little to our creditors each month for 5 years while trying to get established financially. I could have done a chapter 20 to wipe the debt at that time, but I was trying to do the honorable thing. At the end of our bankruptcy, we were hit with $12,000 in fees and interest on top of the student loans. The lawyer said some judge decided one year before that SL interest could no longer be frozen and there was no grandfathering. The SL people made it impossible to pay the people we wanted to pay back, including themselves. It’s been out of control hell ever since. You can’t reason with student loans. We have always driven older cars, taken very few vacations, and could do little for the economy, despite making what would be a “living wage,” while making TWO MORTGAGE/RENT PAYMENTS (I call the SL’s a life mortgage payment. You got me going. So much for short story. This has been a nagging burden on my family for the 29 years since college. We have paid at least $40,000 (they refuse to give us accurate records the loans have been sold so many times!!!) and owe over $70,000 today. I have been unemployed since Oct, so unable to pay, so all the payment in the last several years pretty much for nothing as interest accrues again. If nothing changes, SL’s-’til death do us part!! I started doing research for a book on SL stories several years ago, and stopped, then Allen C’s book came out! God help us, thanks for listening.”

- Kevin

“After reviewing other testimonials here, I’m almost ashamed to comment. But the essence of the issue is what I’m moved to address. The current policies are hurting the very people who are attempting to better themselves and in turn better our society. I am sickened by the “gaming” of what should be a noble and honorable undertaking. Compared to many of the heartbreaking stories I’ve read here, my situation seems mild, but the principles behind the penalties are sickening to me and I’d like to share my feelings. In my case, I’d been making regular payments but decided to take evening classes in order to qualify for taking the CPA exam. The classes were expensive, but rather than incur further debt, I chose to put my existing loans into forbearance and once I’d passed the CPA exam, I’d restart payments with a predictably higher salary. During this period I received lots of promotional mail from my lender offering credit cards and other financial services. I foolishly presumed that it was all promotional and missed the end date of my forbearance which pushed me into default. Apparently I’d gone 2 months not knowing I was in default. That 2 months cost me $11,000.00 because of the Department of Education’s rule for “Collectors fees” where a minimum of 16.58% of the outstanding balance is charged for the “privilege” to resume payments. To me this is a bold “gaming” of the desire to restore one’s credit and to do so, an egregious fee is assessed. I haven’t passed the exam yet and I’d like to study more, but in order to make minimum payments, pay rent, and cover the cost of living a frugal life, I must work as much as possible. I’m very grateful that I can work and that I am employed, but the spirit of this policy is wrong in my opinion. I understand if compliance has been an issue with borrowers, measures need to be taken–however, penalizing someone who is trying to correct their situation doesn’t make sense and certainly doesn’t incentivize the borrower. If the penalty was removed with regular payments, I could understand, but this is just kicking a downed person when they’re trying to reconcile a bad situation. I just wish we had some recourse.”

- Anonymous

“My husband has aquired nearly $100,000.00 in student debt,which may not be a lot compared to others but for me we will be paying this off for probably the rest of my life ( I’m 62). He is currently enrolled in a program to become a registered nurse financing it with student loans. Hopefully with this degree he will be able to find a job. He holds a bachelors degree in information technology and business management. Thanks to the economy he has not been able to find employment utilizing either of these degrees. His loan payment will probably be $500 to $600, which will severely impact our cash flow. What ever increase in income he attains will be eaten up by the loan debt. Our buying power will stay the same or even decrease! I hope through your efforts something will change. Thankyou for the opportunity to tell our story!”

- Gracie H.
National Docu Center LLC (NDC)