Story From A Student Borrower: Loan Payments Come After Electricity Bills:
One kind of business is thriving in the midst of today’s struggling economy: debt collection agencies in charge of tracking down student borrowers.
According to the New York Times, 5.9 million people nationwide are in default on their student loans, which means they have been delinquent on their payments for at least 360 days. The federal government has launched income-based repayment options for federal loans, but there are fewer than 1 million people using the program.
Rachel Banach, 24, is hounded by debt collection agencies. In total, she is delinquent on approximately $39,000 in loans. Her only hope? Be approved for more loans so she can go back to school. Check out her story below.
As I look through my student loan documents to verify how much I owe for this article, it becomes even more daunting, real and overwhelming. I see in print how irresponsible I’m being, but I still feel like I have no choice. And I hate it.
I owe close to 10K to Great Lakes Educational Loan Services, close to 19K to the U.S. Department of Education and close to 10K to Chase Bank. I get updated account summary mail every week. I get weekly phone calls as well, that I don’t always answer. I have tried to consolidate these loans, but every place wants a co-signer and I do not have one.
When I started college in Michigan in 2006, I didn’t think my finances would be so devastating. My junior year of college, my parents “disowned” me when I came out to them. I just didn’t want to “lie” to them anymore, or hide who I am. I was in love and it was beautiful and I didn’t care who knew. That left me with not only financial problems, but emotional problems as well.
When I get bills in the mail, I stuff all the papers and files into my Swiss Army backpack. I am delinquent on them all. To me, making a payment is like throwing money out the window, because that is money I could use in the present for paying electric bills, rent, and cell phone bills to talk to loved ones. I do have to keep my sanity. Making payments and then missing them the following month, results in late fees, and my interest rates going up.
I am stressed and anxiety-filled. I have to pick and choose my battles every day. I am currently working 40 hours a week at two different jobs and studying for the MCAT with the rest of my free time. Since sophomore year of high school, my dream has been to become a doctor. But now, my jobs do not leave me financially flexible.
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