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    Paid off 1 student loan today! Student Loans

    February 01, 2020

    Paid off 1 student loan today! Student Loans

    Paid off 1 student loan today!

    Posted: 31 Jan 2020 09:40 AM PST

    Most of my loans are federal and I'm currently enrolled in both IBR and PSLF (5 years left.) I have a handful of private loans from Navient that are eating at me every time I look at them. I finally paid off all my credit card debt last year so I'm starting to chip away at these private loans. Today I paid off the smallest one ($835)!!! Original amount was $2,000 with a whopping 12% interest rate. Throughout the life of the loan I paid $3501. I feel like I can finally start taking the control back on my student loan debt

    submitted by /u/debbie12487
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    $250,000 in student loans and paid off after 3 years.

    Posted: 31 Jan 2020 11:00 AM PST

    Just made my last hefty student loan payment this morning and wanted to share my journey with internet strangers!

    TL/DR: Paid off $250,000 in about 3 years. Work in brutal big law job that helped me pay off student loans quickly.

    Background:

    - Borrowed $18,500 for undergrad (went to a state school with a full-tuition scholarship but still had to borrow for living expenses).
    - Borrowed $200,000 for a top law school (parents helped a bit with living expenses but otherwise had to take out the rest in loans).
    - Loan amount ballooned to around $250,000 thanks to those atrocious interest rates by the time I graduated in 2016.
    - Started big law in October 2016 and paid a minimum of $5,000 per month (sometimes I paid more) and never skipped a month, and put every tax refund and bonus I received toward loans (I actually didn't receive my first year bonus due to a slow year).
    - Refinanced in the beginning of 2018 with a balance of around $180,000 after I felt more confident that I could last longer in big law and had paid down more principal.
    - Maxed out my 401(k) in 2019 and put in about $5,000 my stub year, $14,500 in 2017 and $15,500 in 2018.
    - Maxed out back door Roth IRA for 2018 and 2019 ($5,500 and $6,000).
    - No other investments and have about $20,000 saved in cash.
    - Work and live in a major CA market (not as high as NYC COL but not cheap like TX either).

    Things that helped:

    - Living like a monk my first couple of years. I rented a room in a house for about $900 per month until I moved in with my spouse when we got married (our families are conservative, so we couldn't live together until then). After we moved in together to a one bedroom apartment, I still have never paid more than around $1400 for my share of the rent (we have always split rent equally).
    - Spouse is also a lawyer but had zero student debt thanks to spouse's parents. Spouse could have certainly helped with my loans, but it was important to me to pay them off myself, so every loan payment I made is truly from me alone. As mentioned above, we have always split rent equally, and split the rest of our living expenses equally too.
    - We were fortunate that both our parents helped pay for our wedding (I put in only about 5%, and spouse/our parents covered the rest), and we put our wedding gifts toward our living expenses (which enabled me to max out my Roth IRA and 401(k) last year).
    - Of course working in big law helped, but it hasn't been easy. I had serious regrets the first few years when I felt like I was working around the clock but had nothing to show for it except a negative net worth. I was essentially $250,000 poorer than someone with zero assets, and I was constantly paranoid of being canned from big law prematurely. It wasn't easy to compare myself with my non-law school friends advancing in their careers with better work/life balance and no monstrous student debt. Also a good number of my friends/classmates from my T6 had their loans completely taken care of by their parents (including my spouse), and I couldn't help but feel jealous when I saw them raking in that big law salary without having $5,000 go out the window each month. Obviously I know many, if not most, law students take out loans just like myself, but somehow I felt like the leper in my inner circle.
    - I also regretted turning down scholarships from other law schools. At the time I was making a decision on law schools, I was younger and more naive, and admittedly only cared about prestige. "Oh $200,000 isn't that bad, I can easily pay that off with my big law salary!" Little did I know how hard that was... Funny story, I nearly almost struck out during on-campus interviews and didn't get an offer until late September. I broke out in shingles due to the stress. And I ended up at a firm that had a notorious history of no-offering its summers (yay), but I scraped by.

    I understand how fortunate I am compared to many other law students, but I'm still not sure if I would do it again if I could go back in time (financially speaking of course - I met my spouse in law school, who I love very dearly LOL). I'm in a much better place now as a fourth year associate in big law with no more student loans. I feel more marketable now that I'm a midlevel M&A associate. I'm hoping to go in-house next year even if that means taking a pay cut, and worst case scenario, I can always try lateraling to another firm to buy some more time if things get terrible at my current firm. This job sucks really hard often, but I'm grateful for allowing it to pay down my loans quickly. But would I do it again? This whole journey has certainly taken a physical and mental toll...

    submitted by /u/throwaway056890
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    Starting to see the light...distant but there!

    Posted: 31 Jan 2020 12:12 PM PST

    April of last year I started really looking into the payments for me and my spouse's student loans. Typical story here--withdrew a lot for grad school, I had some from undergrad, made minimum payments based on IDR for years.

    Well we had gotten to the point where out IDR payments were as much as the standard payment. My spouse was convinced that he would die with his debt, but I was hellbent to get rid of these things. I convinced him that we should start making extra payments because we could afford it, and try to get them payed off in 5 years. He was not convinced that would happen, but decided to humor me.

    So April 2019 we started with $127K in loan debt. After 2 months of tracking and extra payments ($500-750 when we could) I asked him to give me the updated totals of his loans. I was SHOCKED and/or PISSED to see that 3 of his loans hadn't budged, and discovered that all of this time (over 10 years) payment on those loans had only gone to interest!! Nope nope nope.

    I took an aggressive approach and suggested we use part of our emergency fund to pay those loans (~$24K) immediately. He agreed. We started throwing at least $2K each month extra towards targeted loans. He used some of his savings to pay another one of his small loans. When we paid off credit cards and when I paid off my car, that money went towards loans. This month we were able to put an extra $4k to them!

    After 10 months we are down to less than $72K! My goal is to pay them off completely by the end of 2021, shaving 2 years off my original goal. I can see the light coming my way!!

    submitted by /u/emmjay4040
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    Pay off loan in default status in full or rehabilitate?

    Posted: 31 Jan 2020 10:48 PM PST

    Hello all !

    This might be a little long. I apologize in advance plz bear with me.

    TLDR: Trying to decide between paying off a defaulted loan in full or starting rehabilitation and paying for tuition out of pocket. Both options drain my sister's savings account. Trying to figure out what the best option is and if paying off the default loan in full will allow enough time to let the financial aid come through and apply for private loans. Also would like to keep the negative impact to credit to a minimum.

    So this is actually my sister's situation. Her and I are trying to figure out the best course of action. She has a federal student loan (approximately 6k) that is in default status and preventing her from receiving federal student financial aid this semester and applying for private student loans to cover the remaining tuition balance if the federal aid does not cover it (a la Sallie Mae). We are considering two options:

    1. Pay off the defaulted loan in full (at the compromised balance of $5800
      • This would basically empty her savings account. BUT I'm guessing she would be out of default status immediately and her financial aid will then go through and then she would possibly be able to apply for a private loan to cover the rest of tuition
    2. Start the rehabilitation process for the defaulted loan and get on a payment plan for her term bill using out of pocket money (~$7800) for the semester to prevent her from being dropped from her classes.
      • From my understanding (and what she got from multiple calls the the US department of education number), she would be eligible for federal aid in 5 months and the loan would be out of default status at the end of the 9 month period of consecutive payments towards the loan. So no private loans until the end of the 9 months.

    With either of these options she will be draining her savings account but if she goes on rehabilitation she will for sure be able to stay in school for this semester since she will be going on the payment plan.

    A couple of questions currently preventing us from making up our minds:

    • In regards to paying the loan balance in full...
      • Rehabilitation removes the record of the default from her credit history. Would the same thing occur if she were to pay off the loan in full tomorrow? In other words, if she just paid the balance in full, would it have the same affect that a rehabilitation would in terms of her credit report?
      • This also drains her savings account so we would need to be able to get federal aid and a private loan quickly in order to prevent her from being dropped from her classes due to non-payment.
    • In regards to rehabilitaion and paying for the tuition out of pocket...
      • The loan will be in default status for 9 months leaving her no time to get private loans for fall semester (if needed) since it will basically occur during fall semester. She will be eligible for federal aid after 5 months which is fine. There is the possibility that it will only cover a small portion of next semester's term bill at which point she might be SOL for any additional loans.

    What do you guys think is the best course of action? I'm leaning more towards paying off the defaulted loan in full tomorrow and getting the federal aid to come through as long as the record of default comes off her credit report. Looking forward to any and all advice and thanks so much in advance!!!

    submitted by /u/cscareerthrowaway9
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    Is it normal to owe $190,000 in student loans?

    Posted: 31 Jan 2020 10:42 AM PST

    I went to a 4 year university and my mom handled the student loans. I don't know what she did. After graduating, she says I owe $190,000. I'm suspicious that she may have kept some of it because I got grants and and scholarships. And she says she used some of if for groceries and a new laptop for me which I thought was a gift.

    submitted by /u/bargainbinoflife
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    I don't know how I am going to pay for my tuition

    Posted: 31 Jan 2020 10:26 PM PST

    I have $4650 for my university bill. I do not have money to pay it back. I've used all of my federal loans, and I got a couple scholarships. Other years I had more scholarships and less tuition, so I usually only paid a little over $1000, which i did with my job, but even with my current job (which maxes out at 20 hours per week) I'll only be able to put a dent in it. My parents may be able to contribute a little, but not enough to cover the whole cost. I thought about getting a private loan and paying it off over the summer job, but then I remembered that you need credit, which I don't have. The bill is due on the 20th march, and I am scared that if I don't pay it they will disenroll me from my classes. I talked to the billing department and they said there's really nothing I can do. Any suggestions for my situation?

    submitted by /u/pacmain1
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    Tax bomb for 25 year student loan forgiveness

    Posted: 31 Jan 2020 04:24 AM PST

    My wife makes $55k a year and has about 75k left in federal student loans. She is 30 years old. She is on income based repayments. We have always filed our taxes married but separate. We are considering her quitting her job and being a stay at home mom. Her income will be $0, she will stay on the income based repayment schedule and we will continue to file taxes married but separate. She probably has 16 years left until she hits the 35 year mark. What kind of tax bomb can she expect? We live in Maryland.

    Edit: She will start working again in about 5 years when the kid is in school. Just trying to understand how this tax bomb works.

    submitted by /u/Joedav23
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    Devry and Borrowers Defense

    Posted: 31 Jan 2020 03:52 PM PST

    Anyone file a Borrowers Defense claim that went to Devry? I'm about to submit a claim because they never billed my fathers GI Bill I was entitled to and told me the bill would pay for all of my schooling.

    submitted by /u/PrinceKendrick
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    In the process of Loan Rehabilitation. Have questions involving the process and tax offset

    Posted: 31 Jan 2020 03:28 PM PST

    Hello!

    So I'm in the process of doing a loan rehabilitation plan for my student loans. I have defaulted and am need of advice to see if I'm on the right track without getting taken advantage of.

    I recently called National Credit Services who acquired my federal student loans. I haven't signed anything yet, but I agreed to make a monthly payment in order to rehab a $7000 student debt. They are requesting that I sign a form agreement that I can upload onto their website and also asked that I upload my 1040 tax form from 2018 as well. Am I required to send them my 1040 tax form? I also see on the form that there's a section that says "fees & costs" with a charge of a little over $1000. Is this the collection agency costs? Is this a little too excessive and do they have the right to charge me that much?

    In addition to dealing with this, I currently have a tax offset going on. I talked them about it and they recommended me to talk to an tax advisor to see my options. Does starting a loan rehabilitation process stop the tax offset or do I have to wait till it's over to file my tax return? I do not wish to have my tax refund for this year to be garnished and want to make sure if there's a way to prevent it from happening.

    If anyone can help me on this matter, I would appreciate it. Thank you so much!

    submitted by /u/Moofinnz
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    Refinancing fed loans

    Posted: 31 Jan 2020 12:54 PM PST

    Currently owe about 53k, I have a couple Loans that are lumped together and kid through my FedLoan, for my Interest rates the range from 3-6.9%, my average interest rate 5.18%.

    Wondering if it would be worth to refinance and try and get it refinanced to a lower rate. Not sure how much lower I could get.

    submitted by /u/as9311
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    Borrower of defense application processed yet ?

    Posted: 31 Jan 2020 06:17 PM PST

    Is anyone getting their application processed yet or recently?

    submitted by /u/afishbaugh
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    Is it possible to keep your student loan refund and use it later to pay off those same student loans?

    Posted: 31 Jan 2020 02:20 PM PST

    Basically, I most definitely missed the deadline for returning my refund. So my only option now is to cash in these refund checks. My question is, what is stopping me from saving this refund and using them once i'm done with grad school to pay off the loans? Its essentially the same thing as returning it. And my grad program ends this fall semester. Is there any legal reason not to be able to do this? or would it be mostly interest related?

    submitted by /u/meertatt
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    looking for advice on debt from devry

    Posted: 31 Jan 2020 06:01 PM PST

    I went to Devry out of highschool which at the time sounded great as I wanted to program video games. I graduated 2010 and went to Devry directly afterwards, they advertised during classes and it sounded great. I took online classes as they said I would do great at it as they had counselors and teachers that would look out for me and make sure I graduated. But, none of that happened and I flunked out, I procrastinated which I had no accountability for class as I never heard from teachers or counselors, if I remember correctly. Today, I have a $12k debt from Sally Mae, now with Navient. I'm currently taking classes at a community college but, is it possible to get rid of the 12k debt by loan forgiveness or something? I kept pushing it off thinking once I got a good job I would pay it off but I saw that Devry lost a lawsuit on lying about students making more money or easier to get a job after graduation and that being fraud. Then I saw Navient is having lawsuit disputes as well from misleading people which I'm not sure about them being truthful about the Devry case. I'm asking on here as there seems to be little information on where to go and I don't know which sites are legit or are a scam.

    TLDR: I dropped out of Devry back in 2010-2011 and have a 12k debt now from it.

    Is it possible to get the debt dropped/forgiven? If so, where should I go for that?

    submitted by /u/Thedrah
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    Trying to get right.

    Posted: 31 Jan 2020 07:54 AM PST

    I'll try to keep this short and to the point. I went to college but didn't graduate and racked up just shy of $40K in student loans. Basically I really ef'd up, my first job after I was only making $28K and so I didn't know what to do so naturally I blew it off. Maybe a year or so later they started garnishing my wages and taxes.

    Well, I changed jobs and they were no longer garnishing my wages. It kind of fell out of sight out of mind. Here I am years later and several jobs later doing a little better. Basically, I started checking my credit history and all my federal loan accounts say closed / sold off. I know these things don't go away but I'm not sure where to begin in figuring this out. *I never took out any private loans if that helps?

    If you want to tell me "you F*'d up" I already know this.. however, if you can provide some productive feedback that would be greatly appreciated.

    submitted by /u/lstnfnd
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    IBR vs PAYE vs REPAYE for Direct Loans

    Posted: 31 Jan 2020 04:29 PM PST

    Which is better?

    submitted by /u/truthseekingscholar
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    Changing Jobs While Wages Being Garnishment

    Posted: 31 Jan 2020 08:37 AM PST

    My wages are currently being garnished to repay my student loan debt.

    At the end of February I will be switching jobs. This new job will result in a marked increase in pay which will allow me to easily pay off the remainder of my student loan debt within the year and I would really, really prefer to not have the garnishment follow me.

    I have been trying to find information on what happens if you leave one job for another while your wages are being garnished. Does anyone know where I can find this information? Thank you!

    submitted by /u/mph629
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    Can Someone Help?

    Posted: 31 Jan 2020 10:13 AM PST

    Hello,

    I've recently got accepted into a school that I went to in 2016-2018. I had to drop out due to stress related health issues that impeded my studies. I'm trying to get documentation from a hospital and doctors office to prove that's why I dropped out so I can appeal for FAFSA however if somehow I'm unable to can I use a private loan instead? Which ones are good? I'm planning to talk to the school's Financial Aid office soon... I'd love to see if anyone has any answers here to help relieve my anxiety.

    Thank you in advance!!

    submitted by /u/Huemility
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    Should I take out a $2000 subsidized loan in my situation

    Posted: 31 Jan 2020 09:00 AM PST

    Hello smart people, I attend MSU and am going through a bit of financial difficulty right now. It is my third year, and every semester I have received a refund helping me buy books and keep stability in my life to attend school. I have a job - don't worry, but a little extra money never hurts. This spring semester however, I have not recieved a refund (though no personal information has changed), and so in fact owe $1000. This is not much of a problem, as that's not a lot compared to others and a larger number, but I do not have $1000 right now, I barely have enough to pay rent. I actually depended on the refund for helping me out financially, but now that it's gone I am in a situation. I talked to a women at the financial office and saw there is a $1000 subsidized loan from both the fall semester and this (spring) semester that I can take out (in total of $2000), and receive $1000 back for help. I have never applied for a loan before, and my mom is very against that (though it doesn't seem like a lot, especially since it doesn't gain interest until after graduation, but still not a lot). We don't make a lot of money, but by that I know the differences between a want and a need. I need money right now, and this is a very tempting offer. Should I accept it and start budgeting to pay it off in the future, or should I find another way and just work my way up?

    Thanks for any input/advice.

    submitted by /u/Stickrbomb
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    Tax returns and a defaulted loan

    Posted: 31 Jan 2020 08:53 AM PST

    I'm very confused on this situation because I'm still very young. I'm currently still enrolled in college, and one of my federal student loans went to collections. I haven't been able to pay on it even though I'm working two part time jobs as well as being a full time student.

    So my question is, will my tax returns be taken away from me and go towards the loan in collections or what will happen?

    submitted by /u/BinnamonBoastBrunch
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    If your gross income now is lower than your calculated AGI on your last taxes, recerity with your paystub!

    Posted: 31 Jan 2020 05:47 AM PST

    Just a friendly reminder!

    This could save you quite a bit on your monthly payments.

    submitted by /u/whatisoption
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    Use home equity to pay off student loan?

    Posted: 31 Jan 2020 08:11 AM PST

    I'm considering using the equity in my home loan to pay off $42k in student loan. Student loan is 4% and home is 2.4%. Any pitfalls I might be missing?

    submitted by /u/TimeCanary0
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    Do you guys think that the Democrats have a real chance of doing something about the student loan crisis if elected?

    Posted: 31 Jan 2020 11:55 AM PST
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