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I’m Drowning in Interest Only Salle Mae Payments

I have three private loans with Sallie Mae the first one is 13.25% and the other two are at 10.25% I’ve been paying them since 2006. I was unable to consolidate in 2006, 2007, 2008, 2010, 2011. I’m at a point were I can only afford interest only payments nothing towards principal because I can’t afford it with rent and my other bills. I don’t have any credit card debt and my credit rating is “fair” on the boarder line of good. I did have a bankruptcy in 2005 on CC debt and since then, I’ve reestablished myself racked up CC debt on purpose and just paid off $7,600 to boost my credit scores. I’ve tried wells fargo, Chase banks and no one will consolidate these loans because they are making so much money off me. I’m stuck, I can’t even get a home until these private loans are paid off. I dont know what to do Steve. I’m drowning. I just want to pay off the debt and be free and stop interest only payments. I need HELP please!

Who can I reach out to for consolidation help on variable loans I have three and I can only afford interest payments ever month to keep my head above water.

This is your chance to be a hero and help out this person by providing your feedback and answer to the question in the comments section below.

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  • Mr Owenr

    I’m no expert but I think you shouldn’t rack up any credit card debt.

  • Msullivan

    Your situation is way too common. As student loan debt loads grow more and more Americans are changing their plans in order to cope. Too many people feel hopeless.

    You do not mention your career or income. If you have a lot of private debt does that mean you exceeded the limits on government debt? Do you have a graduate or professional degree that you expected to result in increased income? Should you be earning more based on your education? Or were you the victim of a proprietary school scam? If so, you may want to consult an attorney. 

    In any event, you have a budget problem that can only be addressed by earning more or spending less or both. Your debt load makes your budget problem worse because so much of your income goes to interest. You need a plan to eliminate your debt and you do that by paying more each month. Yes, you can save some money by reducing interest rates but with a recent bankruptcy filing you aren’t likely to borrow money for much less than the rates you are currently paying so focus on finding more money each month for the loans and send the extra money to the debt with the greatest interest rate. 

    Can you earn more? Can you take a second job or find a better job? Can you cut costs? You mention living in a high cost area. Why not move? I am sure there is more to your situation than you can explain here but I would encourage you to look at your life. Are you making decisions that undercut your financial stability? If so, why? You state in your follow on comment that you have a great job in television. If it is good and you are being so careful with your expenses, why can’t you pay your debts?

    Don’t focus just on the student loans. You have a big picture issue and need to think about the big picture if you really want to improve your life.

    Good Luck!

    • ramonah

      MSullivan,

      Thanks for your response, it wasn’t exactly what I wanted to hear. I felt like I’ve been lectured and slightly spanked on “the bigger picture” comments.I haven’t been able to pay off my Sallie Mae debts since graduation, It’s not a one simple answer there are several variables in why I have these three private loans that are varaible and why it’s been so damn hard for me to pay them off. I wont get into specifics here. Yes, I was tricked into these loans, I was always told I could consolidate 6 months after graduation which was a lie.

      I need to focus on my student loans that is my only debt left right now and is the reason that is blocking me from purchasing a house (when the time comes in the near future) and I’m looking for consolidation help, or CC companies willing to allow me to transfer the debt, and a lower APR would help thats what I’m focusing on right now to improve my life. 

      I know I need to trim the fat and that is what I’ve been doing. No I don’t plan on moving it’s not an option etc.. The solution is, a bank or CC company willing to help me out in these ridiculous interest rates. 13.25 % and two @ 10.25% since 2006

      Good luck to every person in this exact situation!

      • Msullivan

        Thanks for the information. You have every right to make your own decisions and I don’t mean to lecture. After doing this professionally for many years I have found that many questions I answer are really not the questions that need answered.

        It sounds like you have reached this point on your own and fully understand your situation and the causes. I’m sure you understand that you will get the interest rate your credit rating warrants. I hope someone can beat 13.25%for you and if so, I hope it improves your life.

  • ramonah

    Hi MartyP thanks for your feedback to my post.

    To answer your questions I live in Los Angeles in a HIGH cost no rent control area in the West Side. I don’t have any plans on moving but I have a relative that lives with me and is paying half the rent. (my rent is more than a house payment) That’s the reality of LA I have a great job in the TV business. 

    I started a budget excel sheet (to get organized) with all my bills together, what the APR’s are, due dates, balances, and minimum dues. My system is going pretty well and I’m never late on any bills (and most recently paid off a lot of CC debt) So I’m free in this regard,

    Sallie Mae loans that are private exceed $20,000 I will try credit card companies that offer 0% and see if they will let me transfer over the balances? Thanks for your help I appreciate your time. To put icing on the cake, just finished my taxes the $3,000 I paid just interest last year, I couldn’t claim a dime of it, since my tax bracket was to high by a few hundred bucks. Go figure. I wish the government would reevaluate the private loan sector and these interest rates, this is what is killing our economy and society. 

    • MartyP

      I understand your pain, especially for us that live in high COL areas (I’m in the bay area).  70k here is pretty much 40k everywhere else, plus those who actually have the high debt load usually also make a good bit of money, so the 70k cutoff really sucks.  Considering it hasn’t been lifted probably since they created the credit, they should rally consider adjusting it for inflation.

      Looks like you got your amounts organized, so now just cut the fat.  Maybe you can take in another roommate, or maybe just a commuter roommate (who is only there during the week.

      For the CC companies, usually they’ll send you checks for the BT offers, which you can make out to just about anyone. 

      Also, I forgot to add in the first post, check out Credit Unions for personal loans.  You should be able to get under 10% for an interest rate, so that will also help out.

  • Nancybconner

    I’m in the same boat and would love to hear what others suggest as well…..

  • MartyP

    First off, you don’t need to “rack” up CC debt and pay it off to build credit.  You just need to have a CC to build the credit.

    You also need to expand on your living situation and job?  Are you living alone? Get roommates?  Are you living in a high cost of living area? Can you move to a lower cost of living area and get more bang for your buck, or even extend your commute a little to get a cheaper place.

    You need to examine your budget and trim any “fat” you can.  With that high of an interest rate, even the interest is ridiculous.

    Lastly, depending on the amount, see if you can transfer anything to the 0% offers the CC companies are offering these days.  You can get offers for 15 or even 18 months from CITI these days.  You can pay the minimums, and put the extra towards any high interest student loans left. But only take these if you know you can pay them off when the offer ends.

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