The low-income plans usually have loan forgiveness. You might want to check to see how far along in forgiveness you are by asking them how many qualifying payments you've made. You might need to speak to the supervisor but you can have them send you the letter. The REPAY plan is only 20 years until forgiveness for undergrad loans. At the time of forgiveness, let's say they forgive $30,000. This $30,000 will now count as taxable income for that year. $5 payments now for a slight interest discount won't even put a dent in it. So when your time is up in repayment you should have a plan in place to pay off the taxes on the additional income. The other option is if you're considered insolvent. I don't know enough to explain it accurately but you wouldn't owe the remainder of the loan or the taxes for the forgiven amount so might be something to look into.
If you're in the income-driven loan forgiveness program, your interest will accrue but not capitalize. Your balance on your credit report will stay the same unless your forget to recertify on time with your income each year or when you switch plans. These benefits will go away if you go with a private insititution to get a lower interest rate , btw.
"Doesn't that look worse than even high utilization? Anytime I am denied anything one thing is always listed on the stupid denial letter which is my loan balances are too high."
No. I maintain a very low utilization and despite having a student loan balance higher than my income, I have a very good credit score and have been approved for high limit credit cards. The utilization and payment history counted more, though I think the student loans will be the reason I can't get 800+ yet.
I find that CapOne is just stingy after the initial increases. Discover (0% introductory APR) and NavyFed were very generous in starting credit limit though! Not just for myself but with several people I know with credit scores in the 600's and student loans (seriously, who doesn't have student loans nowadays, lol!). Which in turn helped inprove their credit score, and helped with buying a house. I've also found the "offers you qualify for" features on some website helpful when choosing a card to apply for. Hopefully that will give you the bump you need to cover your procedure.
" I have thought about going back but the thought of possibly having to take out another loan terrifies me and I just don't know if it's worth it or not or if I can even get through another 2 years or so of school without taking out a loan."
If you think that a degree will open doors for you, go for it! You'll might run out of gov loans though. There are other options (besides private loans). For example, Washington State Unversity has quite a few online degrees and a scholorship that covers the tuition (even if you're out-of- state), plus whatever grants you have left with your FAFSA. They are targeted to people who want to finish their last two years.
You still have a lot of good options. Over time your credit score will improve and give you some breathing room, so just be patient. =)
