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Is There Anyway to Get Out From Under My Navient Student Loans? – Kim

By on December 29, 2015

Question:

Dear Steve,

I was young and dumb and didn’t have any financial help with college. I took out student loans to support my education. After 2 years, I was supposed to be able to get instate tuition, but my alcoholic mother kept claiming me as a dependent on her taxes (although she didn’t support me in ANY WAY). Needless to say, I was stuck paying out of state tuition and instead of dropping out (like I am now wishing I did), I took out more loans. Now I’m at $65+k worth of debt and cannot afford to pay anything more than the interest.

My federal loans were consolidated by American Student Assistance, and I have 4 private loans with Sallie Mae, now Navient, 3 with a interest rate of 4.5% and one with an interest rate of 4.75%. I obviously cannot consolidate my private loans.

Sallie Mae put me into collections stating I wasn’t paying them enough to pay off the loan in time, so now my credit is terrible and I cannot or will not be able to get any sort of loan in the future.

I’ve been sold into modern day slavery it seems and I don’t see a way out.

How can I get out of collection since I can’t pay off the loans in full right now and can only pay a minimal monthly fee of $200 a month, since my other student loans are $300 a month for the interest…..

IM DROWNING!!!! I still need to pay for food, housing and utilities! I have about $600 in savings, no retirement and my car is on the fritz, but I cannot get a car loan because….. STUDENT LOANS.

Any advice :( ?

I sure hope this made sense, as I was just on the phone with Sallie Mae, Navient, and the debt collectors office getting the run around with no actual answer or solution.

Kim

Answer:

Dear Kim,

When it comes to the federal loans, it’s one thing to consolidate them but you might want to look at some of the income based repayment plans that can give you some breathing room. As a longterm solution I’m still not in favor of them. See Why Income Based Student Loan Payments Can Be a Terrible Trap.

READ  How is Sallie Mae Calculating My Interest?

On the private student loan front the first thing to consider is if the loans were used for expenses other than for school. If so the loans might be able to be discharged in bankruptcy. See These Private Student Loans Can Be Easily Discharged in Bankruptcy.

If your Navient loans fell into default and became significantly past due, it is possible to settle them for less than the full balance. That strategy has some significant pitfalls and is not for the faint of heart. But for more information, see Top 10 Reasons You Should Stop Paying Your Unaffordable Private Student Loan.

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About 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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