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Can I Legally Do Anything to Eliminate Some of My Crushing Student Loan Balance? – Mark

“Dear Steve,

I borrowed around fifteen thousand dollars at eight percent in federal student loans to help pay for college. Four thousand was unsubsidized. That was many years back. I have been working as a substitute teacher, but only earn barely enough to survive. Sometimes I don’t even get calls to work.

I have state unemployment insurance that helps me with a little money when I don’t get job assignments. I was never able to make adequate monthly payments that would have lowered the loan balance. Today the balance is fifty thousand and rapidly rising. I would like to be able to negotiate the balance down, due to economic hardship.

The IRS will compromise with people, but it seems that these loan people will not. It looks like I may never get out of this quicksand. I’ve already consolidated, and all of the deferment months allowed are about to expire.

Can I legally do anything to eliminate some of my crushing student loan balance?



Dear Mark,

Student loans are pushed on students and most people assume them to be some sort of benevolent warm and fully loan. When you wind up in trouble, that is often not the case.

With up to a 40% addition to the amount of your loan for winding up in collection, the appropriation of tax refunds, and the garnishing of public benefits, you can’t brush off the student loan obligations.

Rather than go into all the options here again, see this previous question and answer, Tiffany is Behind in Student Loans, Late On Other Payments, And Looking For Hope. Additionally, check this article that includes information on the Teacher Loan Forgiveness Program – FFEL and Direct Loan Programs.


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About Steve Rhode

Steve Rhode
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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