How Do I Get Out of PLUS Student Loan Debt? – Jay

I have recently put two of my kids through college (one out of state) using Parent Plus and US Dept of Education loans.

My children have also borrowed from the US dept of Education. We deferred payments and interest during college and are now in repayment.

I owe the US Dept of Education approximately 50K @ (7%) and private lenders about 75K @ (8.50%). Even though I agreed to the terms at the time of borrowing, the private lender loans have been sold several times and their interest calculations are flat out thievery.

I can make the payments, but will not make substantial progress paying these off for some time, given the current terms & conditions.

I am ten years from retirement, have a 170K home mortgage with a fixed 3.85 rate, and make about 90K per year.

I have used the calculator on the Obama Student loan relief site and do not appear to be eligible for any of those programs. I would like to pay off these loans with a consolidation that has some type of simple interest loan with one payment. What methods or lenders could help me streamline this debt? Thank you,

Jay

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  • http://www.consumerrecoverynetwork.com/ Michael

    Hi Jay,
    Unfortunately there are presently no great options for consolidation of student loans.
    Streamlining may be best achieved by applying a debt roll up strategy to accelerate the pay off time.
    This involves applying more than the minimum required payment each month. This will shave years off of the repayment schedule depending on what formula you apply. Can you swing 15 to 20 percent more than the monthly amount you pay now?

    • Jay

      Michael, Thanks for your comments, I would need to do some calculations to see if I could pay more each month as I am paying over 1000.00 per month as it is… I was looking for something like the “lending club” (advertised on this site). So that I could manage one debt. Would there be  potential for a lending business that specialized in assisting folks with this type of debt?

    • Jay

      Michael, Thanks for your comments, I would need to do some calculations to see if I could pay more each month as I am paying over 1000.00 per month as it is… I was looking for something like the “lending club” (advertised on this site). So that I could manage one debt. Would there be  potential for a lending business that specialized in assisting folks with this type of debt?

      • http://www.consumerrecoverynetwork.com/ Michael

        Hi Jay,
        Unfortunately there is little available for people who need to consolidate student debts at an affordable rate.
        Unless you are experiencing a hardship and have qualifying IBR loans – you end up stuck with no attractive options.

        I am not sure whether in your last sentence you are asking if there is potential for you to get a consolidation loan from an existing business, or if there is potential for a business to provide a lending/payment solution to those struggling with student loans.

      • Jay

        Yes, my last comment was just an open-ended question. I do not know anything about the business of finance, but it seems there would be a large market for a lending business that would help folks consolidate and manage student loan debt. Maybe this does not make sense since they are mostly unsecured loans. I will take your advice and see if I can afford more aggressive payments and continue to look for any alternatives.  Thank You, 

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