Income-Driven Repayment Programs for Federal Student Loans are a Mess

Income-Driven Repayment Programs for Federal Student Loans are a Mess

The Government Accountability Office (GAO) has just published a report examining Income-Driven Repayment (IDR) programs and how they are being managed. The findings are not encouraging. The Department of Education approved forgiveness for a total of 157 loans under Income-Driven Repayment (IDR) plans as of June 1, 2021, but has not taken the steps necessary … Read more

Can I Lower My Student Loan Payment by Contributing to My 401(k)?

Question: Dear Steve, I’m Paying a consolidated parent plus loan off. Also, I have a parent plus loan in deferment (daughter in school). The husband has a parent plus loan for another child and is going into repayment in a few months. Also, I qualify for PSLF but those payments would be very high as … Read more

Almost Nobody Has Has Their Student Loans Forgiven Under an Income-Driven Repayment Plan

A couple of weeks ago Rodger asked me how many people have actually completed an Income-Based Repayment plan. I didn’t know the answer so I went and asked the Department of Education and surprisingly they got back to me relatively quickly. Don’t Be Shocked As of January 27, 2020, there have been 19 people that … Read more

How Many People Have Student Loans Forgiven Under the Income-Based Repayment Plan?

Question: Dear Steve, I have been trying to find out how many people have actually completed an Income-Based Repayment plan because the Dept of Education always argues this in an adversary proceeding. Any idea on how many people there are who have actually completed it? Rodger Answer: Dear Rodger, Nobody. Nada. Zilch, Zero. The Income-Based … Read more

Student Loan Assistance Companies on Notice Now for Inflating Repayment Plans to Get $0 Payments

A long implemented trick by some student loan assistance companies has been to tell consumers they can inflate the number of people they support in order to reduce the monthly payment on Income-Drive Repayment (IDR) Plans. Consumers have reported and I’ve covered stories where sales representatives of student loan assistance companies, sometimes pretending to be … Read more

Bankruptcy Court Again Finds Income Driven Repayment Plan Should Not Stop Federal Student Loan Bankruptcy Discharge

Here is another bankruptcy case from 2003 where the Court determined the fact someone could enroll or was on an Income Driven Repayment (IDR) plan was not a prevention to allowing a discharge of the federal student loans in bankruptcy. The Court records show the Judge said: “The ICRP is Only One Factor for a … Read more

I Work in Public Service and Just Learned My Loan Won’t Qualify for Forgiveness

Question: Dear Steve, I have a FFEL consolidation loan for my son’s education that began on 1/2005. Every payment has been made on time to this point. I qualify for the Public Service Loan Forgiveness program as I work for the public with people with disabilities. I found out that because I don’t have a … Read more

Alternative Repayment Plan – The Little Known Federal Student Loan Plan When All Else Fails

For individuals struggling to repay their federal student loans and think the only repayment options are a Graduated Repayment Plan, Extended Repayment Plan, Revised Pay As You Earn, REPAYE, Pay As You Earn, PAYE, Income Based Repayment Plan, IBR, Income Contingent Repayment Plan, ICR, or Income Sensitive Repayment Plan. For Direct Loans there is also … Read more

Should I Take a 401(k) Loan to Payoff My Parent PLUS Student Loans?

Question: Dear Steve, I have a balance of approx. $35,000 of parent plus loans that I have taken for three children in college. Interest rate is 8.125%. Balance does not move much due to daily interest. Should I take a 401K loan to pay off. I am 57, I’ll be dead and gone before this … Read more

Should I Tell My Mom I Took Out Student Loans in Her Name? – Lisa

Question: Dear Steve, Recent grad. Loans are coming up. Consolidated my loans, and mom doesn’t know I took out loans in her name (13,000). Need help figure out which plan is best to repay hers so that she won’t find out and possibly kill, sue, or stab me. Have a few questions on what am … Read more

Who is Reputable to Help Me Get My Student Loans Forgiven? – Bella

Question: Dear Steve, I graduated in 2007 with $90,000 in loans… since then i have been having babies and working very minimum and my loans were in forbearance. Now they are $160,000 and completely unaffordable. I cant even cover the monthly interest rate at this point let alone the actual loan. Do you know of … Read more

I Went Back to Get My Nursing Degree But How Can I Lower My Payments? – Dawn

Question: Dear Steve, Hello, I am a 51 yr old RN, married with a joint tax return. My job mandated that i go back to school for my BSN, which cost me $21,000 in federal student loans in the state of Florida. My son also was in college and I signed for a Parent Plus … Read more

How Can I Deal with an Unaffordable Parent PLUS Loan After Bankruptcy?

Question: Dear Steve, The Financial Aid dept. at Lincoln Collage of Technology, Indpls, In., at the time of meeting regarding a parent plus loan, would not take my husbands financial info as “he was not present at that meeting” , but only took mine (the mother), and I hardly made anything at my MLM business … Read more

My Parents Have a High Income But Struggling Under the Parent PLUS Payments

Question: Dear Steve, When going to school for my undergraduate degree, I was denied any federal aid or grants because of my parents’ income being too high. However, they were (and still are) in an extreme amount of debt and were extremely close to losing their house and declaring bankruptcy. Because of this, I was … Read more

Why Did They Give Me Parent PLUS Loans I Could Not Afford?

Question: Dear Steve, I am a single mom who, without any help from their father, helped my two daughters get their degrees… one in the medical field and the other in the culinary arts. One thing I didn’t understand as I was taking out Parent Loans is that I was getting them, not based on … Read more