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How To Handle Private Student Loan Debt?

To whom it may concern:

Recently I just went into repayment with my private student loans. Prior to repayment we consolidated all my private loans into one pool, totaling about $100,000. My first payment was due in the amount of $800 on 1/22/2012 and of the $800 i could only pay $200. Since then of course the bank has been calling to see why the payment hasn’t been made, and i explained to them at this time I do not have $800 a month.

Right now I work for Binder and Binder in the Intake Department working full-time making approx $800 bi-weekly before taxes. In addition to my private student loan payments I have federal student loans, car payment, car insurance, utilities bill, rent…etc.

Wells Fargo does not care about my salary or what I can afford to pay. My parents are co-signers but they have enough of their own bills at this time and if they could help they would.

I know I am in the inital stages of paying a debt back, but I dont know what my rights are and how to rectify the situation I am in.

My questions are:

1. What are my options, if the bank is refusing to work with me?

2. Is bankruptcy an option for private student loans? If so, will my co-signers have an any impact by doing so?

I appreciate your time, and hope you can help with this matter. Thank you again and look forward to speaking to you soon.



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  • Ernie Boxer

    I am in a similar state of ruin with mounting private student loan debt and a worthless degree, with penalties and bloated interest now mounting somewhere over $130,000. I have not had a true total given to me however so i am at a point where I know I cant even make interest payments. I ask for the debt verification and never hear anything back until it is passed on to the next collector. As far as good options there are none, I had to make the decision that if I cant afford payments its in my best interests to pay nothing and if i am put into collections they will get next to nothing anyhow, so I have nothing to loose. Do the math on the collections amount for you, if it is low they most likely will not process your case to court as it is not worth it to them. But I do make much less than you so your long term options might be different.

  • gladys

      I’m in the same boat, and atleast you tried to repay your loans. I just wish we were more educated about private loans, because that’s the one thing that’s literally causing a huge student loan debt problem. I’m glad you asked this questions it helps with my situation.

  • Chelle87

    Hi Nicholas,
    I’m so sorry you’re having a hard time. I’m also in debt with student loans–to the tune of $75K. Twenty thousand of that is from fees resulting from my government student loans being sold. I defaulted on my loans when I became homeless and even though I’m no longer homeless, I still don’t know how to proceed with my life…and I’m 42 years old! I wish I had some advice for you…you sound like a reasonable person and don’t deserve this kind of stress. Maybe if we all get together, we can enact real change in the area of government and private student loans. Take care of yourself.

  • Icecoldsean

    I too have student loan debt.  I’m currently up to about 70-80k in student loans. The bad part about it is that I didn’t learn TOO much while I was at the college I went to, DeVry University, go figure suposed to be a really good school.  But I got outta there with a bachelors degree with no real new knowledge that I didn’t have before going there, big waiste of time and money.

  • Paul

    Hey Nicholas, I just read your story, good luck and I hope you figure out something that will help you get back on your feet and take care of those loans.

    At least you are taking the steps to address these issues, I tried to pretend that I didn’t have to deal with my student loans, and I am dealing with them more than a year later.

    Best of luck

  • Dorothy

    Seems to me the bank should work with you $200 is better than $0.  I know first hand you can’t put student loans on bankruptcy.  Continue to talk to the bank and maybe even get a lawyer.

  • Res

    I’m so sorry. Your situation is almost as bad as my own…sounds just as bad actually. I have about 100-110,000$ in debt,  89,000$ of it are all private student loans. God help me I don’t know how that happened. I fall in a category of people who qualify for nearly no federal student aid. I’m not married. I’m 23, turning 24 soon, and I have Crohn’s Disease…living away from home for 5 years and still I couldn’t get much federal aid. My school is the Art Institute of Phoenix and I swear it was a waste. They were accredited when I started but now they suck and have a tough time getting future employers in for our portfolio reviews.

    In short, I can’t get married, I can’t move, I can’t save for anything, and I feel like killing myself because my life is now doomed. Bankruptcy laws have been changed to prevent students from getting out of student loan debt even if it’s with private lenders all because people are freaking greedy. Feels like we are being punished for pursuing the American Dream and our president can’t do anything for those of us with PRIVATE student loans. It’s a death trap, my friend…a real death trap.

    I spoke with 10 different attorney’s on my situation and they all said I was crap outta luck, and one even told me to move out of the country and change my name….wow….you see?

    I have no choice but to pay the loans with cosigners and just let the rest default. Of all the calls I made to get more time to try to pay, as in 2-3 years from now my car will be paid off and car insurance will lower, aside from trying to get my online business going, but that doesn’t matter to lenders. I’ll try my luck gathering financial documentation and explaining to them how messed up this is and either get some discharged, for a miracle, or at least held off for that much time to give me a chance, WITHOUT interest gaining.

    Forebearance? with a small fee…of 50$ per loan…mmm 150$ to forebearance and increase what I owe…just to not ever be able to afford it even more! Same for deferrement…why postpone the inevitable? default and go late? MORE FEES!


    There is no escape…yours and my best hope is to prove in court how rediculous this is, each individual situation and PRAY that you got a judge who CARES and interprets the law in your favor….

    • Lori

      I think it is totally rediculous how some of these schools take ppl in and promise them euducation , job, ect, and when you finish , you cannot get  a job, I went to one of the rivate schools , when i done my exten , it wasnt even for the type of job i was training for *went to school for med billing & coding* they sent me on extern for med asst… so i there for have no experience in this field.. so cannot get a job, now they are wanting me to pay them back all this money i made good grades was in school everyday , *was pregnant at the time*… and cannot get work cause i have no experience in the field i went to school for .

      • Steve Rhode

        What school did you attend?

  • Msullivan


    I wish I had some good news, but you are not in a good place. It is extremely difficult to discharge student loan debt through bankruptcy. Short of a life-threatening disease or accident it isn’t likely. Your lender has no obligation to be kind or helpful. A private lender is less likely to be patient than the government.

    Most importantly, as co-signers your parents are on the hook for this debt. If you do not make the payments I suspect they will be extracting the money from your parents fairly soon. And the lender is likely adding penalties, interest and fees each month you do not make the full payment so the amount of the debt is likely growing. You need to talk with your parents and they need to understand that you owe $800 but soon it may be $900 a month and if you don’t pay, your parents may end up paying $1,000 a month or more down the road.

    I understand your issue, but the fact is, if you borrow $100,000 for education you must earn far more than $21,000 per year or you will be in serious trouble and you are. If you were mislead by the school you attended you might consider legal action against the school.

    Good Luck!

    • Lars

      I think it is absolutely crazy the trouble kids are in with student loan debt.  

  • Michael

    Hi Nicholas,

    There are helpful options to deal with government student loan debts.
    Unfortunately there are no real options for the private ones. You get to do what the lender on the private ones will allow to be done, which is just not much.
    There are implications to your parents for the loans they cosigned.
    Read this article on this site for some details about the options you DO have:

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