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My Chase Mortgage Issue Left Me With Massive Student Loan Debt

Written by Steve Rhode

Question:

Dear Steve,

It all started when I got hurt on my job with a long recovery process. First, it was worker’s comp payments of barely $200 a week. I was a single mother and about to lose everything. I asked for a home mod from Chase, which I’m still fighting over when they never paid my insurance.

It was cancelled and in between the months of back and forth, my home was damaged. Now, I have no way to repair it and it’s getting worse. Then, after surgery I got a visit from the worker’s comp rep informing me I was required to sign up for DARS rehab program and already had an appointment.

I went in and the next thing I knew I was signed up to go to a 4 year college program they would sponsor. I had developed PTSD and agoraphobia and was in no shape to think about anything. I tried finding help but couldn’t.

So, I go to school to learn a new trade. Well, that was a nightmare. It was all I could do to get through the coursework. As a DARS requirement, they paid for college but only after I used any Pell grant money from FASFA. They were also supposed to help with living expenses, transportation, etc. but when I asked they always said no. Then, at the start of each semester I was forced to take student loans to pay tuition because my DARS counselor did her best to stall by asking for grades, or some other request she knew I couldn’t provide.

Now, I finally graduated with over $50k in student debt. I’m 53yrs old and the job I finally found has nothing to do with my degree. It’s a job similar to a previous job in inventory control.

Turns out, DARS could have just sent me to a 2yr program the Pell grant would have been enough to pay for but I did what they told me to do and now I’m stuck. I’ll never pay this debt off, retirement is wishful thinking, and I forget about leaving anything I worked so hard all my life for to my children.

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Honestly, I don’t know how much longer I can continue working. My mental state is getting worse. I take medication but the agoraphobia binds me to my bedroom. I leave only for work.

It says right on my DARS paperwork that they would sponsor college. I have tried finding others similar to my situation but haven’t been able to. I assume it has to do with privacy since DARS is not allowed to disclose any information about the consumers they supposedly help. I called the complaint line but got nowhere.

Is there any recourse for how Chase bank’s mistake caused me to have damage with no insurance? Is there any way to get out of the student debt?

Dana

Answer:

Dear Dana,

There are so many moving parts in that question it would be darn near impossible to try to unwind that clock.

Was and is Chase mortgage escrowing your insurance payments? Did you change insurance companies and Chase didn’t know about it? Typically the bank will get the insurance bill directly when they are escrowing funds.

If Chase was in the loop on your insurance because they were escrowing it then they would have received a late and termination notice and may have had a forced placed policy to protect their interest.

In fact Chase was the subject of a forced placed insurance class action lawsuit where Chase required higher rate insurance when no insurance was in place.

Regarding the DARS program. I believe you are talking about the Texas Department of Assistive and Rehabilitation Services program that provides disability rehabilitation services.

According to Texas A&M University “The primary goal of DARS is to help people become employed. Services that may be provided include: help with tuition expenses, books and supplies, tutoring expenses, technology aids, etc.” – Source

So I’m very unclear on how much tuition assistance is available. If you are legally blind or legally deaf you would be eligible for a tuition waiver.

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So it sounds like your student loan debt is from federal student loans. The best solution at this point would be to consolidate the loans and put them into an income driven program that will lower your monthly payment. The downside to that approach is it will increase the balance due and at the present time there is a tax liability when that debt is forgiven. For more on those downsides, read this.

But as long as you understand that, then you can look at lowering your student loan payments through these income driven programs.

Sincerly,
Steve

You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.





About the author

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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