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I Went to LSU Shreveport in 1990 and Still Paying Student Loans. – Julie

“Dear Steve,

I took out a student loan in 1990 at LSU-S in shreveport, LA in order for me to finish my degree.

I had left an abusive husband and had been a stay at home mom. I needed that amount for living expenses so I could graduate sooner in order to take care of my children financially.

Twenty years later, I still owe about $5000. I got the loan at 8%, was told that would not increase. By the time I graduated it was 9%. I eventually remarried and my situation did not change.

My husband has had diabetes for 43 years, a two year history of a heart attack and stroke. We live on a retirement account which is slipping out of our hands since we have to pay all our household bills, $1000 a month is fastly running out.

My husband is on disability and we are much in debt because of his health issues. Every doctor and hospital thinks we should pay a bill in full. It is a constant medical bills to pay for, actually 12 medical bills.

I am 60 years old and this paying back Sallie Mae is way beyond what it should be. I am sure the interest I have paid is a number I don’t want to know. It seems like a racket to me. It is a never ending black cloud over my head.

Do you know if there is any way I could get my total owed to be lowered or erased; or are we supposed to run out of retirement money, then see if they might be able to lower the amount I owe. Which I am quite sure they won’t but I could try.

Julie”

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The Answer

Dear Julie,

Are you supposed to run out of retirement money, you ask. The answer in a way is yes. You see when you take out any form of credit the terms are generally very absolute. They say you need to make X payment in the Y date of each month until paid in full. Borrowing is full of absolutes, life is not.

The path of draining your retirement till you are out of money isn’t really a sustainable solution. So you drain all the money, and then what is the plan? Now you are just broke.

It was probably time a long time ago that we needed to get your financial situation realigned to fit within your income. In situations like these if other debts are prohibiting you from making your student loan payments the logical approach is to file bankruptcy and discharge that other debt.

If you have no other debt and you are running out of retirement money and Sallie Mae does not have any solutions they can offer you, then we need to think about defaulting on the Sallie Mae loan debt. When you do that the balance will go up, interest and penalties will be added, they may sue you and attempt to garnish your wages. But you can’t pay whet you don’t have.

If you did consider bankruptcy it is possible you could reduce or eliminate your Sallie Mae student loan debt in an adversary proceeding as part of your bankruptcy. You appear to be in a group of people who are more likely to get some benefits from the bankruptcy and their student loan debt. In particular you are older, have underlying health issues, have made a good faith effort to repay and your incomes is not going to go up.

You can look at these other specific cases where people were able to get some benefit from bankruptcy and deal with their Sallie Mae student loan debt.

Outside of this approach, if this truly just private student loan debt, then you only options are going to be solutions the loan servicer offers. Unlike federal loans, private loans make little to no longterm allowance for life happening.

Please post your responses and follow-up messages to me on this in the comments section below.

Big Hug!

I Went to LSU Shreveport in 1990 and Still Paying Student Loans.   Julie
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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.

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