Need Some Advice

[Salesman]

Hey everyone. I am a recent graduate who is considering filing for bankruptcy for my student loans in a couple of years. The reason I say a couple of years is for a cosigner release clause that I, for personal and moral reasons, must meet. I'll explain my situation and then you can tell me what you guys think.

First and foremost I want to state that in no way, shape, or form am I attempting to place blame on anyone but myself. I lived under a financial rock when I was in college, and the most I had to do with my financial aid was to come home and sign the FAFSA that my mom had already filled out. With neither of my parents ever going to college, I should've foreseen the dilemna this would create. But, I digress.

So after graduation, I sit down and assess the damage. All in all, approximately 140k in student loan debt... for a Bachelor's degree... in psychology. Ok, I can handle it, let me just find a job. So the hunt begins, but every job that I can get with this degree I could've gotten out of high school, and only pays $9-$11/hr. Luckily, I was able to get a job at a used car lot as a salesman. Needless to say if it wasn't for this bit of good fortune I would have defaulted after my first payment. And with this job I can barely maintain any kind of decent lifestyle, and I'm making between 40-50k a year. Without consolidating, my student loan payments at this point would be around $1300 a month. But these institutions have to have some options, right?

Wrong. Dead wrong. My minor student loans, (AES and DirectLoans), offer longer terms, tiered payment plans, interest only payments, etc. Both of these payments total $339. However, Wells Fargo, who I owe approximately 93k to, will not bend whatsoever. To consolidate with them I had to have my aunt cosign, which they do give a two-year cosigner release. These payments equal $600 a month, and have no cap on the interest rate. They also have no repayment plans, and the only forbearance other than in-school is 2 months long!?! What is that going to do for me??

My plan is after my aunt is released from the loan to file for bankruptcy, and file for the separate undue hardship proceeding. On an average month, my net is approximately $2200. I also changed my tax allowances to give me more through the year net rather than a lump sum in hopes I won't default on my loans. My expenses are as follows:

Rent: $350
Electric: $60
Columbia Gas: $78
Internet/Netflix/Xbox Live: $59
Water: $30
Insurance (Car/Renters): $103
Car Payment: $224
Cell: $92
Fuel: $200
Groceries: $200
Wells Fargo: $600
AES: $166
DirectLoans: $173
Credit Card payments: $110

I do not have cable TV service, I use Netfix and my email account from my parents comcast to watch On-Demand. I have to have a phone for work, I text my customers frequently to keep up or gain referrals. There also is another vechicle which I am cosigned on for my girlfriend which is $325, but she makes that payment. The rent for my 1 bedroom house is only $250, but I am responsible for any up-keep to the residence, which includes grass cutting expenses and general maintenance/renovation. So the extra $100 should be more. The only way that I am able to even pay these expenses is for the time being my parents take care of the AES payment, and I always steal leftovers from their house. Also, I did have some money saved from my busy months where I netted closer to 3k, but those months are few and far between. And I've been drained after a few short months. I am also current on all of my student loans payments and am in good financial standing with all of my debt.

As Paul Harvey would say, "..now you know the rrrrrrrreeesst of the story," do you guys think I have a snowballs chance in hell of getting these discharged? At this point I would even take a partial dismissal. I've thought so far as to writing a letter to a celebrity like Oprah who might be willing to help. I tell my friends and family if I hit the lottery, I'll give the rest away, all I want is the 140k to get rid of these loans. I have no problem with working, but I'm in a 1 step forward 10 steps back situation. At the current rate I will have no money put away for retirement, I can't fix my car is something happens, and my degree is doing nothing for me except for hanging on a wall. The company I am working for has virtually no vertical movement being that is a franchised location, and the only way I can improve my situation is to take a paycut and hope another company promotes me, which will put me in default. Feel free to keep the suggestions coming, because at this point I am out of options.

[KeithDoxen]

I'm going to give it to you straight. These will not be discharged. The way the law is currently written, and the way that judicial precedent has played out, as long as you are an able-bodied individual able to work, student loans aren't going anywhere.

Also, again, more straight talk here, Oprah is not going to care. Nor will the media, or any other charity or celebrity. The reason is that there are currently millions of people in your exact same situation right now. I have met TONS of young people myself who are in very similar situations. We're just not hearing about them. If the problem persists long enough, and enough people default, eventually this will become another mortgage crisis. But that only happens when the lenders start to hurt. No one cares about the consumers.

If I were you, I would go to graduate school. You sound young, and don't seem to have any dependents. It would be a wise move, because ALL your student loans will be deferred while you are in school, AND you can actually find a program of study that leads to a decent-paying job. You've already learned what most of us liberal arts majors learned after college: that no one wants to hire a liberal arts major. So figure out what the best-paying practical career is that you could live with and go to grad school. Once you get out, you might have a salary that will allow you to actually pay down your student loans.

Given that your credit card payments are tiny, my guess is that you have almost no consumer debt. It would be foolish to file bankruptcy and then live for the rest of your life with that under your belt simply because you think some judge MIGHT rule your way in an AP, even though 99 percent of the judges out there will not. Plus, an AP is a lot like a trial. Do you have the funds to pay an attorney to spend hours working on your case? If not, your chances of victory go from 1 percent to 0 percent.

Go back to school. Find the cheapest grad school that you can get into, defer your student loans, and take up something practical.

[iswmle]

My only hesitation with the graduate school suggestion is that he will accrue more debt from the school. Deferred or not, he will have to paying for his education, unless he is in a field like physics or engineering (where they receive tons of funding and the grads education is usually paid for). But for a lib arts major they are more than likely looking at footing the bill.

[disconapper]

I'd suggest holding off the grad school as well. Try and get with a company that does tuition reimbursement, lots of them do and purse the graduate degree from there.....

[despritfreya]

Duplicate post?????

http://www.bkforum.com/showthread.php?71171-Need-some-advice

Des.

[bankrupt123]

This is because you will find presently huge numbers of people inside your identical situation at this time. I've met A lot of youthful people myself who're in much the same situations. We are simply not listening to them. When the problem continues lengthy enough, and enough people default, eventually this can become another mortgage crisis. But that only comes about when the loan companies begin to hurt.