I Was Denied by the Military Because of My Private Student Loans

“Dear Steve,

Right now it just seems like nothing is working out.

My plan a years back was to get an education and get a job. Sounded easy, so yeah not so much as I’m sure many know.

Any way at this point all I’m trying to do is get out of debt, pursue what I want as a career (be a police officer), and stop worrying so much.

When I graduated I went directly towards applying and left and right for a job in general not to mention in the criminal justice field. I couldn’t find either,

After several months I found myself working 2 part time jobs, one at Taco bell and one working security. The two combined I wasn’t even getting 40 hours of work. I did what I could on my student loans, I talked to them and they deffered all the federal, but I also had 2 private loans. They deffered them for 6 months, but then afterwards I couldn’t get them to Deffer them again. I paid what I could, but never could manage a full payment. It delayed them a little, but after several months I started getting letters from both companies saying they needed a full payment or they would default them.

Well, I lucked out at this time and managed to finally pick up a full time job, however I wasn’t going to get my first paycheck in time. So I called both companies, the first agreed to give me one month defferment and then defer my loans for 12 months and have me just pay up what was due over the last 6 months.

The secound wouldn’t work with me at all. In fact they told me the only way they would defer it is if I made payments on it (which confused me cause if I could afford to pay it I wouldn’t need it defered.).

So I called my father to see if he could help me out. He asked if he could make a payment at a Wells Fargo bank (since this was the holder of the loan) that he had an account in. So I called the loan company and asked if he went tomorrow and paid it (the final day I had to pay it) at the bank, they said this was fine. Well, I thought I had dodged a huge bullet, except 2 weeks later I got a letter saying the loan had gone into default.

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So I called the company and they said “well, since it took the bank 2 days to process it”, even though I paid it on time it was still considered defaulted. I asked them what I could do and they offered for me to pay the loan in full over 4 years rather than 10. Which brought my payments to 450 dollars a month. I agreed to that so that I could avoid any legal issues and what not.

So now I am paying in all my bills, almost 1300 dollars a month, working two jobs, and still have federal loans being defered. I just paid my car off and thought maybe I’d have some relief. Then my car’s engine just gave out (the day after I paid it off). My wife is helping me out and she has a full time job paying rent and her student loans. She has also had to defer some federal loans as well. I had a spot lined up in the military for a job I was excited to do, and they where going to pay up my federal loans, plus supply housing and food for me and my wife.

Well, now that has changed because my clearance has denied because of this wells fargo loan. They say if I paid it off I’d be fine, but they say the amount is too high. So really at this point I am making ends meet for now, and hopefully I can get a job in the military that doesn’t require a clearance and still pays up my federal loans. I’m barly keeping my head above water, have no insurance, and I’m just emotionally drained from working non-stop. I wonder everyday why it is my education is the reason I’m working twice as hard to make ends meet, isn’t it suppose to be the other way around.

Help me out with any suggestions you may have. I understand my background story might be a bit confusing. I’d be happy to explain any questions you may have. Thanks for your time.


Dear Somebody,

Student loans are the great american modern debt tragedy. While Federal student loans have options, private student loans don’t.

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I’m worried about two things, the student loans that are deferred and the way Wells Fargo treated you.

I’d fight the Wells Fargo determination if you have proof of payment by your father by the deadline. If the money was received by the bank and you can prove that then the two day B.S. excuse doesn’t fly with me.

Deferred loans will at some point not be deferred. And while they are in deferment the balances are growing from accumulated interest.

On your wife’s loans, if she is making payments on any Federal student loans, tell her to look into the Income Based Repayment program, IBR, to see if she can lower her payment.

Go fight that Wells Fargo situation and then report back in by posting an update in the comments below.


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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.
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