Money

Published on November 15th, 2013 | by EditorOne

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Are You A College Loan Zombie?

Along with so much of our day-to-day expenses, which many can barely handle, is the strangling debt of student loans. With the inability of young people to get jobs out of college and middle-aged people to get back into the workforce, college loan defaults are exploding. For most people, this is the unintended consequence of a Recession.

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Getting Help To Climb Out Of College Debt Morass

If you feel like you are being swallowed by a sinkhole of college loan debt, you are not alone. One reason for this escalating debt is the high cost of college tuition, fees, and room and board. It won’t be too long before only the wealthiest students will be able to afford attending colleges and universities.

As it is now, many are barely making it with the grants and student loans filling in the gaps. Some students have to drop out, because they are unable to pay the overage that is not covered by their financial aid. Whether they eventually graduate or not, the student loan debt is incurred and must be paid back. Student loans are exempt from bankruptcy, unlike other debt. When you have nowhere else to find answers, visiting a local credit repair firm is the only answer. They will provide valid solutions.

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Contact Student Loan Departments Directly

When you first lose your job or have not yet gotten hired after graduating, contact the Department of Education Student Loan department. This should be done immediately to demonstrate you are responsible and want to work things out. They will offer you a deferment or forbearance agreement to sign. With a deferment, you are suspended from making payments for an agreed-upon period of time. You can choose to pay interest or suspend that too. With Subsidized Direct Loans the interest does not accrue during the deferment period and the same amount owed will be paid back, when it ends.

If you had an Unsubsidized Direct Loan or Stafford Loan the interest does accrue and the total amount to be repaid increases. In the case of forbearances, interest accrues for either type of loan, as does the amount owed. This is more common for people with hardships such as unemployment or health problems. Only permanent disability or death can cancel the responsibility of re-payment.

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Consolidation Companies Can Help Reduce Payments

At the time you first see the monthly payment for your student loan, the common reaction is a feeling of panic or dread. “How can I pay this huge monthly payment, when I make so little money?,” is often questioned. With due diligence or the help of the credit repair company you consult, seek out specialty businesses that consolidate student loans. They can spread out the number of years or offer lower interest rates that allow you to make smaller payments.

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Put Off Large Purchases For Years

When all else fails, you must make hard choices as to what you can put off buying. If your car is in fair to medium condition, put off buying a newer one for a few more years. Although you might have The American Dream of a house dancing around your head, put it on hold. The mortgage approval process is very negative towards student loan debt, as are credit-reporting agencies. For some reason, they will list them on your credit report as a list of separate debt owed, rather than one block. They most likely represent semesters or quarters, rather than an academic school year. Some young people are purposely putting off getting married or having children. They simply cannot approach these special life moments knowing they have such high student loan debt.

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They say you cannot hope to have decent earning power without at least attending a junior college. High school is just not enough. So that leads everyone to go to college leaving them with massive college debt. Knowing there is help out there will improve the chances of you not turning into a college loan zombie. With some discipline you can chop into that debt and live the life you planned.


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