Please HELP....not sure what options I have!!!

[andrew3100]

I am not sure what options I have for myself, so I thought I would give you an outline of my situation and to see if there is any help for me.

I am married, but most of the positive debt is under my wife. My debt revolves around private student loans. I know that these are very difficult to deal with in bankruptcy court, but I have a lot of debt with these loans, and the majority of the money taken out was NOT used for schooling. During college, just finished recently, I took an extremely large amount of money to use for gambling rather than school and living costs. I am not sure of the total amount, but I think I have a total of around $250,000 or so due to high interest rates and deferring due to lack of income.



Can anything be done? If I were to start paying on these loans, I would be paying roughly $2700 a month in student loan payments. That is more than I bring home in a month. I have caused so many problems with my family due to my addiction, I am ready to move on to a clean slate, but this debt is something that is going to haunt me unless something can be done.



Please advise if you think there is something that can be worked out with this.

[debtinohio]

Ugh. Always fuel addictions with unsecured cards.

Anyway, no -- it is doubtful anything can be done. Get with an Attorney or call Sallie mae or whoever the loan is with, if it's spread out to 30 years perhaps it would be more around 1000/month.

[tigergem]

Here is a link with information about the programs that are available if you are having trouble paying your student loans. I don't know if any of these will help you or not, but good luck!

http://www.finaid.org/loans/troublerepayingdebt.phtml

[NoTomatoCan]

Andrew - That is a tough situation to get into. As someone who has visited a casino or two myself AND as someone with sizeable student loans, I really feel for you.

Since the public (Stafford/Direct/Perkins) student loans are capped, and with that much in student loan debt, I am assuming most of them are private student loans. Personally, I finished with about $110k (wife about $70k - we ONLY owe about $140k now...lol), but they were all public, no private loans at all.

You have some options, but they are all long term and will probably have you paying back most of your debt...

For your public/Direct loans have you looked into consolidation? Since interest rates are at historic lows, you can at least lock your public student loans at a decent rate AND get them spread out over 30 years like debtinohio stated. Part of this depends on when the loans were distributed, and only the federal gov is consolidating loans now, but that is at least an option. They also offer graduated payment plans that allow you to pay less now, based on your income, and then gradually increase the payment. Also, depending on your loan type, you can possibly do an Income Based or Income Contingent repayment plan. These are two slightly different repayment options that, under certain circumstances, allow for some forgiveness of your debt.

For your private loans, the 30 year payment may be your only option. At least the terms become (somewhat) manageable. You can check if your private lender has any income based repayment options, but most that I have seen do not.

There is always the very rare Undue Hardship option via bankruptcy. Since this would not have applied to my situation, I only did minimal research on it, but anyone I have ever discussed it with basically said it was a longshot and almost impossible to obtain. There are some good threads on this forum that discuss it in more detail... Not something I would ever count oun though.

[Hos75]

u shoulda fueled ur addiction with unsecured cards by going to the local gold store and stocking up....

[tigergem]

Hey NoTomatoCan - - wasn't there a thread not too long ago about a person who got a hardship discharge in BK? I think they might have even been Pro Se, not sure, but the student loan people didn't show up at the hearing or send an attorney so they won it by default. Talk about LUCK. It was a good story. I wish I could remember who it was.

[NoTomatoCan]

Yeah, I remember that one! And I think you are right that the filer was pro se.

Very much a long shot. Lucky indeed.

The way student loans are treated differently than every other type of unsecured debt in BK is an outrage. Back in the day, when the majority of loans were federal student loans (which have some low limits - too low for most schools nowadays) it made more sense. But today (or rather the past 10 years or so, when credit was easy) many lenders basically handed out personal loans under the guise of being "student loans". People like the OP got into situations where they ended up owing these outrageous amounts. Just crazy.

Not making excuses for someone spending student loan money on gambling, but if I could have taken out more when I was in school, I would have. Glad I didn't now, but that was simply because they weren't available.

[flyinbroke]

They handed them out like candy for above and beyond tuition and books because they knew it would be like pulling teeth to discharge them. There have been people who took out 4-5-6 times what they needed for school, and now they are stuck with no jobs, degrees they are not using, and 150K in nondischargeable (99 percent of the time) debt.

IMO the only people who should have six digit student loans have MD or JD after their name. However, the Sallie Maes and their ilk knew how to push a product.