My husband and I have a huge amount of student loans and some credit card debt.
Thankfully, we aren’t behind in any payments. The problem is that my lonas are getting ready to come out of their grace period. We owe about $118,000 in loans (about $42,000 is direct loans). The rest are private loans through Chase and AES. He also has one from Great Lakes Loans. We owe about $19,000 in credit card debt combined. We both work and have a combined income of about $62,000 yearly. My grace period ends in March and we are already paying about $1250 per month in loan and credit card payments. We also have a $350 monthly payment on our car, not to mention rent and other expenses. I am just feeling very overwhelmed with all of this. My loans are going to add an aditional $500 a month to our payments. I just don’t know how we are going to make it. We have very little savings, and our debt to income ratio makes it incredibly hard to get approved for anything (it was really hard to get an auto loan). I would just love to be able to consolidate our student loan debt to get a lower payment amount each month. I hate that we will be paying on them for so long, but we need breathing room now. Any advice will be greatly appreciated. I just feel like we are drowning in the debt and will never have anything to show for it.
Let’s tackle this in steps.
- Look into the Income Based Repayment (IBR) program for your government backed student loans. Let’s see if we can’t get that payment down to give you some breathing room.
- We will need to evaluate if you can get some payment reductions through that program that will allow you to make ends meet and save each month.
- If that does not do the trick I want you to use the free How to Get Out of Debt Calculator to review your options in dealing with your other debt.
- We’ll then have to look at dealing with your other debt to make room for your student loan payments and savings.
- On the private student loans, there is little/no assistance available.
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