My fiancé has a ridiculous amount of student loan debt. He attended Felician College in Lodi, New Jersey, a private school and has $140,000 in student loan debt from two lenders: NJClass/HESSA and Nelnet.
The payment from HESSA is $900/month and the one for Nelnet is $600/month.
HESSA is impossible to deal with as it is a private loan from a state agency. They will not negotiate, consolidate, or defer the payments on the loan.
Nelnet did provide us with a reduce payment forbearance for 12 months which brought the payments down to $279/month. However, these payments only went to the interest, not the principle.
My fiancé went to school to be a teacher and he can’t even do that because he would not make enough money teaching so he had to leave that field and go into retail to be in management so we can afford to live. However, he is not making much money ($60k) and we can barely afford our rents, bills and the student loan payments ($1,500/month – that’s an entire paycheck). Not to mention my fiancé is unable to put any money away for savings so he has no emergency, rainy day or retirement fund.
We are supposed to be getting married early next year and I am in a constant state of panic and filled with anxiety. I have really virtually no debt and a really great credit score. I am so afraid to get married because then I will take on his debt and I fear we will struggle for the rest of our lives – – won’t be able to afford a house, have kids, etc.
Please tell me if we should stop paying the loans – or if we should just stop paying one loan.
I do not believe that the HESSA loan would be discharged in Bankruptcy but if it was, how would filing for bankruptcy effect our chances of being about to afford a house (we live in Northern NJ so everything is super expensive).
If we were sued and brought to court, is it possible the court/judge would be sympathetic to the fact that we are struggle and this enormous amount of debt is just not fair and its not reasonable to think a person making $65K could possible afford to repay this.
I would really appreciate any guidance you could give us. I am in tears just writing this because I feel totally lost and overwhelmed. Thank you.
I can certainly understand your concern. And it goes almost without saying that private student loans are a terrible trap.
With private lenders there is no mandatory income based payment requirement. The terms they offer are the terms they offer.
Often they suggest deferment or forbearance which can just be a trap since the loan balances can grow and grow while payments are not being made.
It does appear Felician College was a Title IX school and so the loans would not be fully discharged in bankruptcy but the loan amounts above qualified educational expenses, might be. See this article for more information.
In the face of no other good options then stopping payment on the private loans is always an option. See Top 10 Reasons You Should Stop Paying Your Unaffordable Private Student Loan.
I would not count on a judge being sympathetic since they have to decide these issues by the law and not by their emotions.
Ironically in many cases if people are sued they can negotiate with the lender at that point and get a better repayment deal. And when some people lose the maximum wage garnishment can be less than the payment the lender demanded. If the lender does not sue and the statute of limitations expires then they would no longer be able to sue or garnish to recover.
This strategy of strategically defaulting on your student loans is not without risk but it is one strategy to deal with an impossible situation.
Remember, when you get married you do not inherit his debt. His debt before the marriage remains debt in his name after the marriage.
Your concern over if this will impact your life is a reasonable one. The answer is it can certainly lower your available income but what are your options; to ditch the dude and go look for someone without student loan debt?
Please post your responses and follow-up messages to me on this in the comments section below.