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I Was Homeless and Took a Student Loan But Now I’m Drowning in Debt. – Jeanie

“Dear Damon,

I took a student loan while I was homeless…I was totally convinced what I was told that the more education I have the better because I can then have a good job, get out of my situation and at the same time pay off what I owe (student loan) but it did not come true for me having a very young child at that time.

Childcare was unaffordable for me..even if I did get help, my other problem was having no car to be able to beat all the work and daycare schedule. My job never got any better. Then I went out of state thinking I would be better off looking for work there but I had nowhere to live and end up living from one motel to another and accumulated credit card debts. (I consolidated and paying it off monthly) I also paid part of my student loan using credit card which I managed to pull through the years.

The rest I consolidated and in deferrment. I never had any money even to pay them a small amount. Most of the time it was in deferrment and still is. My principal balance was alittle less than $10,000 and it grew almost to $40,000. I lost my job 3 years ago and now I work only as a substitute para educator and no work in the summer.

Even during school days my income does not cover all my basic necessities or bills. My electric bill is soaring as I haven’t paid it since November and I am barely able to pay my rent. My unemployment exhausted a year ago. With my income I cannot even afford grocery and am still raising a teen who has problem with his back and limited movement. I dont have a cent of savings and I am approaching 60.

Is there any way out of this?….any kind of work that would hire me extra than the substituting job? Please, anyone out there talk to me, tell me anything to help get out of this debt…

Jeanie”

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The Answer

Dear Jeanie,

Given your current situation you are just going to have to forget about the credit card debt for now until you can improve your income situation.

At some point a bankruptcy is likely going to make sense if your creditors come after you. If you haven’t yet, you are going to need to stop making payments on the credit cards in order for you to afford basic necessities.

I know I am not telling you anything you don’t already know, but until you can pick up some extra work and increase your income, your only focus has to be on survival at this point.

The only advice I can offer on the income side is to continue to apply for work both in and outside of your area of education. I know it seems like a daunting task, but there are jobs out there. There is however a lot of applicants applying for a smaller supply of jobs, however, someone is going to get them, so you just have to keep going until you do.

I Was Homeless and Took a Student Loan But Now Im Drowning in Debt.   JeanieI Was Homeless and Took a Student Loan But Now Im Drowning in Debt.   JeanieDamon is a talented independent debt coach that provides in-depth assistance and consultations for people struggling with debt. If you want a personal debt coach to help you through a difficult situation or want assistance to find secret discounts offered by debt settlement companies I think Damon Day is an excellent person to contact for advice and assistance. He can be reached directly at DamonDay.com

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I Was Homeless and Took a Student Loan But Now I'm Drowning in Debt. - Jeanie by

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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Steve Rhode

    I would imagine that you have government backed student loans. So the good news is if you could pay even a little bit each month towards the loans you would be eligible for the Income Based Repayment Program or IBR. The IBR would give you a limited payment based on your income.

    But the larger issue is that your income does not even cover your basic living expenses. Until we can even get you back to a break even position this is going to be a challenge to increase income and reduce expenses. Is there a possibility of either? Are you currently eligible for any government benefits like SNAP or housing allowance?

  • http://GetOutOfDebt.org Steve Rhode

    I would imagine that you have government backed student loans. So the good news is if you could pay even a little bit each month towards the loans you would be eligible for the Income Based Repayment Program or IBR. The IBR would give you a limited payment based on your income.

    But the larger issue is that your income does not even cover your basic living expenses. Until we can even get you back to a break even position this is going to be a challenge to increase income and reduce expenses. Is there a possibility of either? Are you currently eligible for any government benefits like SNAP or housing allowance?

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