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I Work as a Correctional Officer With Loads of Student Loan Debt. – Lynn

By on October 12, 2010
I Work as a Correctional Officer With Loads of Student Loan Debt. – Lynn

“Dear Steve,

I enrolled in college and the student loan money was easy to get. Now the money is due and we are being crushed by the payments of the student loans. I have close to 70k in student loans and my income is not going to be substantially impacted by my degree. We put our credit cards with a consumer counseling agency and have paid all but 4k so far. This payment is $511 a month. We also have a car payment and some credit cards that I did not put with the counseling agency as well as 2 personal loans totally about 11k. I work as a Correctional Officer in a state institution.

What can I do to either lower my monthly payments or come out from under the student loans.

Lynn”

Dear Lynn,

If your loans are government backed there is a program called the IBR or Income Based Repayment plan. That’s your best shot at getting a lower payment even though you will have to pay on the loans for 20 years. If you have private student loans, you’re screwed.

For anyone reading this and just starting out on a journey to get out of debt, when faced with credit card debt and crushing student loans the first choice must be to consider bankruptcy to discharge all the unsecured debt so you can focus on the student loans. Student loans have tremendous power over borrowers, can’t be discharged in bankruptcy, can levy bank accounts, intercept tax refunds and tack on up to 40% in penalties if you default.

Student loans don’t take prisoners in a battle.

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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.

8 Comments

  1. Steve Rhode

    October 13, 2010 at 10:10 am

    Lynn,

    Here is the fact page for the Public Sector Loan Forgiveness Program. Does not apply to private student loans.

    Steve

  2. Lynn

    October 13, 2010 at 1:43 am

    Thank you very much. I am considering the IBR, and since I work in the public sector, in law enforcement, if I have read it right, in 10 years, the remaining balance will be forgiven. I think that is how I read it.

  3. Steve Rhode

    October 13, 2010 at 12:32 am

    Lynn,

    In hindsight if the credit counseling group had known of the totality of the student loan debt at the time you were considering enrolling they should probably have told you about bankruptcy so you could focus on the student loans.

    It might still be something to consider if it allowed you to get rid of those other loans and start cranking on the private student loans if you are having a tough time getting by. The last thing in the world you want to do it put the loans in forbearance. Delaying payment only increases the balance.

    Something to consider.

    Steve

  4. Lynn

    October 13, 2010 at 12:27 am

    Two are private and the rest are either Subsidized or Unsubsidized Federal Loans. I have spent days researching this and am coming to the realization that yest student loans do not take any prisoners.

  5. Lynn

    October 13, 2010 at 4:27 am

    Two are private and the rest are either Subsidized or Unsubsidized Federal Loans. I have spent days researching this and am coming to the realization that yest student loans do not take any prisoners.

    • Steve Rhode

      October 13, 2010 at 4:32 am

      Lynn,

      In hindsight if the credit counseling group had known of the totality of the student loan debt at the time you were considering enrolling they should probably have told you about bankruptcy so you could focus on the student loans.

      It might still be something to consider if it allowed you to get rid of those other loans and start cranking on the private student loans if you are having a tough time getting by. The last thing in the world you want to do it put the loans in forbearance. Delaying payment only increases the balance.

      Something to consider.

      Steve

      • Lynn

        October 13, 2010 at 5:43 am

        Thank you very much. I am considering the IBR, and since I work in the public sector, in law enforcement, if I have read it right, in 10 years, the remaining balance will be forgiven. I think that is how I read it.

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