Help Please!

[Anonymous]

In 2007, I was a fresh faced 18 year old recently graduated from high school with my sights set on college - and only $20,000 standing in my way. I received a colorful advertisement in the mail from Chase Education Loans promising the bright future I was so desperately seeking, and snagged the opportunity immediately. Sure, I read the fine print - but at 18, I didn't quite understand the meaning behind "variable interest rates" and signing away my soul. I wanted to go to college, and Chase offered the solution. Problem solved!

During my first month at school, I received a piece of mail from Chase - my first piece of mail addressed to my dorm! I opened it up, and sat down in shock as I read the numbers printed on the paper - My $20,000 loan was in deferment until I graduated, but would continue to accrue interest during that time period. Over 30 years, I would end up paying $100,000 in interest - that's a grand total of $120,000 for my freshman year of college.

Once I'd obtained my bachelor's and my loan came out of deferment, I was sent a bill with a whopping total of $34,000 to start paying on - and a minimum monthly payment of $330. Out of that $330, only $30 goes towards the principal of the loan - meaning I'm paying $300 a month in interest.

Drowning seems to be the only way to describe how I feel when faced with the reality of my situation - although helpless, ashamed, and depressed are right up there as well. After 3 years of making payments on this loan, I haven't even scratched the surface - my statement this month says I still owe $34,171. The total hasn't gone down despite paying every month, it's gone up!

I've tried educational counselors, financial advisors, loan forgiveness programs (unavailable to private loan occupants), renegotiating the terms of my loan with Chase - you name it, I've tried it. I feel desperate and frustrated all at the same time; I went to school to provide a better future for myself and my family, and yet I've put myself into a predicament that I can't seem to climb out of. I'm desperately trying to make something of myself, and yet my student loan for ONE year of college is truly making it impossible for me to move forward!

Times are tough for everyone - in a struggling economy, we're all just trying to make it from paycheck to paycheck. My goals in life, however, are stymied by the weight of the decision I made at 18 - the decision to believe and trust in a company as prosperous as Chase so that I could go to college and accomplish my dream of a degree.

While I submit applications for second jobs so that I'm able to make more than the minimum monthly payment and combat this loan, I'm gracious for any advice on moving forward.

[Kenny]

Unfortunately, you are drowning in your student loans, and everyone hates that. It's a somewhat common thing in America now. I know it's easy to say that it's Chase's fault (that the company is so prosperous why would they take advantage of a teenager, etc.) but the reality is we all should know what we're getting into when signing up for financial tools.

This will be a trial in your life, but it will not defeat you. Student loans aren't eligible to be discharged in bankruptcy, so I would urge you to NOT let these accounts get delinquent. Strive to pay these down; ask about income based repayment plans as the student loans are then discharged after 20 years of payment on them. (See here for more information on income based repayment: https://studentaid.ed.gov/repay-loans/understand/plans/income-driven ) I think this is probably your best option. This is something that you shouldn't feel helpless, ashamed, or depressed over. You can and will overcome this. I urge you this: knowledge is power. Take your time and really research all of your options with regard to your student loans. (I know you said that you've tried everything, but I promise you there are more things out there to do and know.) This site is a great site for jumpstarting that knowledge. Use the forum as a sounding board: post your questions and develop a plan of attack.

[Anonymous]

What is your interest rate?   I have $30k in federal loans at 3.25% and my payments are not even close to that.   If I went to a 10 year repayment period my payments would be less than yours.

[SCF]

It sounds like this is all private student loan debt, is that correct?  Private SLs don't have the same variety of options for borrowers to limit repayment time and keep repayment affordable, but that doesn't mean that your lender may not have their own programs to assist you.  It is definitely something you should ask about.

It also sounds like you have a really high interest rate, or you are on some type of "interest-only" payment plan, which is why you aren't seeing much progress toward paying your debt down.  A good place to start is a basic repayment calculator (there are tons out there), where you can change your payment amount, payment term, and interest rate.  Using that tool, look at what extra payments can do for you, or start from the other side, when do you want these loans gone and what would you have to pay to meet that goal?

You should also look into refinancing with a company like SoFi (there are also several private loan refinancers out there, so research around), because as you'll see with that calculator, your interest rate can make a big difference.

[Anonymous]

It's just ONE private student loan, from ONE year of college. It's ballooned from $20,000 in 2007 to $34,000 now. My interest rate fluctuates, but last months statement has it sitting at 9.16%. I can't afford to pay more than the minimum payment right now, although I do understand that that would help quite a bit with the principal of the loan. I have also spoken with Chase, and they refuse to renegotiate the terms of my loan or to do anything to help me with the exception of putting into a temporary two month forebarence, where my loan would continue to accrue interest but I could skip two payments. That's not a smart option, and I know that - but that's all that they're offering.

[Anonymous]

The difference here is that mine isn't a federal student loan, it's a private student loan. It's on a fluctuating interest rate, but last months statement said I was looking at 9.16%.

[Anonymous]

The problem here is that I'm not eligible for any kind of repayment plans based on my income, this is a private student loan - not a federal one. There are literally no programs out there for me that I can seem to find, and I have been researching this for years. Knowledge is power - I agree - but I'm reaching out because I can't seem to find any help for my situation. The only way to not pay $120,000 total on a $20,000 loan seems to be paying more than the minimum payment a month, but I can't afford to do that when I make $27,000 a year and have a $330 student loan payment a month. That's literally 1/4 of what I clear a month.

Do you know of any private loan options that I'd be eligible for?

[mmmlive1999]

Try and refi to a low fixed rate with a new company. Over 9% is ridiculous,sorry to hear you are in such a bind.

[Pat94108]

Do you think you could refinance? Say with a company like Sofi? Also, just curious how come you only have private loans? Didn't you quality for federal loans? 

[Pway]

Have you tried talking to a credit union to see if they can help you by getting a lower interest rate?  They some times can help.