Loan Repayment Help

[RainyNights]

My grace period ends 8-16 and my first payment is due 9/20.

 

I already have very low fico scores because of credit woes and have much work to do to fix it...and fixing that is a goal I have. I don't want to add to the problems. I was told that my loans , would be consoladated but I recieved two letters from Great Lakes ( don't understand this loan stuff but I chose Discover as my lender)

 

 

I was told one loan would be subsidized and one would be unsubbed but my letters show both, on both and both say they are "stafford Loans"

 

Letter one:

Today's todal Over $9,4xx.xx

 

Estimated payment: $107.09

Graduated or Income Sensitive Repayment: 40 pymts $49.97, 80 pymts $145.99

 

Letter two:

Today's todal Over $2,xxx.xx

 

Estimated payment: $50.00

Graduated or Income Sensitive Repayment: 40 pymts $30.00, 55 pymts $50.00

 

I graduated in Feb and ONLY found a 7 week temporary job that has ended. I currently have NO income. Really puts a damper on how proud I felt at 39, graduating with honors after only successfully completing the 8th grade and being the FIRST person in my class to take the certification exam and passing with a 93 ( only needed a 70).

 

What are my options? I was hoping having this loan would help me rebuild my credit since I couldn't get credit any where and now one of my biggest accomplishments may just spell more credit problems for me.

[RangerGreen]

Ask for forbearance?

 

This is why I love DirectLoans and advise people to go with government lenders. You get 36 months of forbearance, no questions asked, and possible additional deferments. If you get in trouble financially, it is way easier to deal with than private lenders.

 

Best of luck

[RainyNights]

Ask for forbearance?

 

This is why I love DirectLoans and advise people to go with government lenders. You get 36 months of forbearance, no questions asked, and possible additional deferments. If you get in trouble financially, it is way easier to deal with than private lenders.

 

Best of luck

 

Is direct loans an option? NOW the schoool I went too has everyone going through direct loans. I had a choice between several lenders and I don't recall direct loans being one.

 

Thanks for the reply, help and wishes of luck,

[snowpuppy]

Do NOT ask for a forbearance, ask Great Lakes for an "Unemployment Deferment".

 

You have to register with your local unemployment office to be eligible for work. This does not mean you are collecting unemployment, this means you are registered for work by posting your resume, providing your contact info, etc so if they have a job available that you can do, they will call you.

 

The reason you want a Deferment instead of a Forbearance is that the Government will keep paying the interest on your subsidized loans while you are unemployed. The interest on your unsubsidized loans will accrue, but some subsidy is better than none!! A forbearance is a temporary situation when you are asking your payments to be stopped for a time but the interest accrues.

 

Great Lakes should give you either a 6month or a 12 month Unemployment Deferment. You can use this, one deferment at a time, for up to 3 years. You will have no payments while in this deferment.

 

Post back if you need anything else

Edited July 10, 2010 by snowpuppy

[RainyNights]

Do NOT ask for a forbearance, ask Great Lakes for an "Unemployment Deferment".

 

 

 

The reason you want a Deferment instead of a Forbearance is that the Government will keep paying the interest on your subsidized loans while you are unemployed.

 

Great Lakes should give you either a 6month or a 12 month Unemployment Deferment. You can use this, one deferment at a time, for up to 3 years. You will have no payments while in this deferment.

 

Post back if you need anything else

 

THANKS Snowpuppy!!

 

I do have some questions:

 

You say the "government will keep paying the interest" do I have to pay that back eventually?

 

When you say "up to 3 years" does that mean I can defer for up to 12 months 3 times? I remember when I applied I was told "you get ONE 6 month grace period". Is this different than a "grace period"

 

So you think great lakes s an okay way to go? I ran the calculator at DL and the only way it seemed to help lower my payment was with the standard pay or the income contingent and witht hat I would be paying for 265 months.

 

How will any of this efect my fico? Right now the loan is showing as "paid as agreed" but also shows as "student loan, payment deffered". When it comes out of deffered will up my scores any?

 

I had NO idea my payments would be so high...I only owe total, under 13000.00. Since I am not working I thought of going back to school but I am afraid that if I did....I wouldn't be able to afford the payment on all of it. Any suggestions?

[RangerGreen]

Do NOT ask for a forbearance, ask Great Lakes for an "Unemployment Deferment".

 

You have to register with your local unemployment office to be eligible for work. This does not mean you are collecting unemployment, this means you are registered for work by posting your resume, providing your contact info, etc so if they have a job available that you can do, they will call you.

 

The reason you want a Deferment instead of a Forbearance is that the Government will keep paying the interest on your subsidized loans while you are unemployed. The interest on your unsubsidized loans will accrue, but some subsidy is better than none!! A forbearance is a temporary situation when you are asking your payments to be stopped for a time but the interest accrues.

 

Great Lakes should give you either a 6month or a 12 month Unemployment Deferment. You can use this, one deferment at a time, for up to 3 years. You will have no payments while in this deferment.

 

Post back if you need anything else

 

I would just caution (and for this reason I didn't recommend it) that unemployment deferment can be very difficult to qualify for. There are two requirements:

 

1)You must be diligently seeking but unable to find full-time employment in any field or at any salary or responsibility level even if you are not eligible for unemployment benefits (or if your eligibility expired).

 

2)You must be registered with a private or public employment agency if there is one within 50 miles of your permanent or temporary address. School placement offices and “temporary agencies†do not qualify as public or private employment agencies.

 

The first one is pretty key: ANY field at ANY salary/responsibility level. That means that even with my law degree, I'd have to look for and take a job as a secretary, or managing a McDonald's. OP took a certification exam, which leads me to believe that there's some specific field OP is looking in. To qualify for unemployment deferment, OP would have to look for basically ANY work.

Edited July 11, 2010 by RangerGreen

[snowpuppy]

An unemployment deferment is the easiest thing in the world to qualify for. You must self certify that you are actively seeking work (it sounds like you are) and you must be registered with your state's employment agency. Most states that I am aware of allow you to register for their employment services online and upload your resume.

 

If you have trained as a nursing assistant, you are not going to show up on a search for a cook. And these days, we all know it's a long way from interview to hire. You are self reporting the jobs you applied for, if and when asked. Direct Lending has never asked. I had GLHEC for awhile years ago and they asked me to complete a form to show I had applied for at least 3 jobs in the last 6 months.

 

You are not required to pay back the interest subsidy you receive on the subsidized portion of your loans. The unsubsidized interest will continue to accumulate but you can pay it quarterly. It's not mandatory that you do.

 

You are understanding it correctly. You get 6 months grace period after graduation (no payments). Unemployment Deferment is different. During your repayment you can use up to 36 months of unemployment deferment. Yes, you can use it say 6 months at a time. If you go to work and can make payments again, good! If not, then use another 6 months at a time.

 

Leave your loans at GLHEC for now. IF at some point in time you are close to the end of that 36 months of being unemployed, THEN consolidate your loans with Direct Lending. You will THEN have a NEW loan (total of all your old loans) and will qualify for an additional 36 months of unemployment deferment.

 

13000 may seem like a lot but it's 1/3 the cost of a new car. If you go back to work AND are are starting repayment, look at both the IBR and the ICR calculators at Direct Lending. This may help you tremendously.

 

Need anything else, post back!

 

 

Ranger, you do NOT have to LOOK for a job as a secretary! If you get a call from your state employment agency with a job offer of any kind, let me know! You will be the only person I know of who has!

Edited July 12, 2010 by snowpuppy

[RangerGreen]

An unemployment deferment is the easiest thing in the world to qualify for. You must self certify that you are actively seeking work (it sounds like you are) and you must be registered with your state's employment agency. Most states that I am aware of allow you to register for their employment services online and upload your resume.

 

If you have trained as a nursing assistant, you are not going to show up on a search for a cook. And these days, we all know it's a long way from interview to hire. You are self reporting the jobs you applied for, if and when asked. Direct Lending has never asked. I had GLHEC for awhile years ago and they asked me to complete a form to show I had applied for at least 3 jobs in the last 6 months.

 

You are not required to pay back the interest subsidy you receive on the subsidized portion of your loans. The unsubsidized interest will continue to accumulate but you can pay it quarterly. It's not mandatory that you do.

 

You are understanding it correctly. You get 6 months grace period after graduation (no payments). Unemployment Deferment is different. During your repayment you can use up to 36 months of unemployment deferment. Yes, you can use it say 6 months at a time. If you go to work and can make payments again, good! If not, then use another 6 months at a time.

 

Leave your loans at GLHEC for now. IF at some point in time you are close to the end of that 36 months of being unemployed, THEN consolidate your loans with Direct Lending. You will THEN have a NEW loan (total of all your old loans) and will qualify for an additional 36 months of unemployment deferment.

 

13000 may seem like a lot but it's 1/3 the cost of a new car. If you go back to work AND are are starting repayment, look at both the IBR and the ICR calculators at Direct Lending. This may help you tremendously.

 

Need anything else, post back!

 

 

Ranger, you do NOT have to LOOK for a job as a secretary! If you get a call from your state employment agency with a job offer of any kind, let me know! You will be the only person I know of who has!

 

Interesting. The way it was explained to me by someone from Access Group was that it was actually difficult to qualify for. I hope never to have to need this info, but it's good to know!

 

Obviously, I take back everything I said

[snowpuppy]

There are sooooo many unemployed that Direct Lending has pretty much an automated application on their website. Complete it, sign it electronically and submit. You usually get an approval in a few days.

 

I had Great Lakes ages ago, Like the 1990's. They did everything by paper back then so not sure if they are still paper today. Simple form, list the last 3 places you looked for work and fax or mail in.

 

My forms were usually:

Rocket Scientist at NASA, Airborne Ranger, US Army and Playboy Playmate of the Month.

 

[RainyNights]

My forms were usually:

Rocket Scientist at NASA, Airborne Ranger, US Army and Playboy Playmate of the Month.

 

 

LOL!

 

Thank you both for the help! Sorry it took so long to post my "Thank you".

 

My only other questions are:

 

If my payment is due 9/20 when should I asked GL for the unemployment deferrment becausea lot could happen by then?

 

I interviewed for a job this week that I would love to have for the learning opps it overs. However it is 0-40 hours a week...Though I would average about 12-20 hours. Is there any plan for me, if I would get this because at 12-20 hours a week ( and some weeks none) I could not afford the pyament they have set for me. I need to be available for all possible hours/days so I couldn't even get a 2nd job to help out.

 

 

Ranger: I don't mind apply for anything at this point. I am proud of my certification but more proud of my family and just want to be able to put food on the table.

[snowpuppy]

If you are still unemployed as of Sept 1st, then apply for the unemployment deferment. You might want to be proactive and register with your state's employment agency, post your resume on their search engine, etc. Then you can say you are already registered and looking for work.

 

If you get a job and are still underemployed, you can look at the requirements for Economic Hardship. Basically it means your student loans are too steep for the income you are earning at the moment.

 

You should qualify easily as you are right out of school.

[RainyNights]

If you are still unemployed as of Sept 1st, then apply for the unemployment deferment. You might want to be proactive and register with your state's employment agency, post your resume on their search engine, etc. Then you can say you are already registered and looking for work.

 

If you get a job and are still underemployed, you can look at the requirements for Economic Hardship. Basically it means your student loans are too steep for the income you are earning at the moment.

 

You should qualify easily as you are right out of school.

 

 

Thank you , snowpuppy. I am registered with the unemployment office. I will wait until sept 1st and contact Great Lakes. I didn't get the job I wanted...lol This is so DEPRESSING!

 

Thanks again for all the help!!!

[Toy80]

Just a quick note: I called directloans yday bc my forbearance is coming due: There is only a 3 yr limit for deferment but on the other hand you can keep requesting forbearances every 12 months for an unlimited amount of time. I am not too sure how it is with unemployment deferment but a economic hardship or other types of deferment are capped at 3 yrs because interest is not accruing on these loans. On another note I do recommend directloans. I consolidated w/ them due to my monthly payment being over s $1000 before them and now it is $375.

[snowpuppy]

Just a quick note: I called directloans yday bc my forbearance is coming due: There is only a 3 yr limit for deferment but on the other hand you can keep requesting forbearances every 12 months for an unlimited amount of time. I am not too sure how it is with unemployment deferment but a economic hardship or other types of deferment are capped at 3 yrs because interest is not accruing on these loans. On another note I do recommend directloans. I consolidated w/ them due to my monthly payment being over s $1000 before them and now it is $375.

 

While you are entitled to forbearance, it is up to the agency to grant it. Some borrowers have reported running out of good will gestures and they will eventually want you to start paying it back.

 

If you qualify, you can choose Income Based or Income Contingent repayment plans and that may help keep your monthly payments manageable. The feds pay only the interest on the subsidized portion of your loans. Any unsubsidized loans are accruing interest either in deferment or forbearance.

[Toy80]

I don't qualify thats why I have a forbearance. I went to private undergrad and grad schools. I am currently paying my private loans but since I just bought a house and need a car I am going to ask for another forbearance. I work for gvt so soon as I start paying on them I qualify for public service loan forgiveness but I have to start paying on them first,

[snowpuppy]

I don't qualify thats why I have a forbearance. I went to private undergrad and grad schools. I am currently paying my private loans but since I just bought a house and need a car I am going to ask for another forbearance. I work for gvt so soon as I start paying on them I qualify for public service loan forgiveness but I have to start paying on them first,

 

 

You might want to use Direct Lending calculators to determine either your Income Based or Income Contingent payments. DL servicers (contractors) were recently hammered by the Dept of Ed for not calculating the payment correctly. They are to use your AGI from your previous year's tax return and not your income.

 

Your payment an be as little as '0'- $5. Yes, it is a real payment.

You can actually get 120 payments of 0 and then the balance forgiven.

Edited August 9, 2010 by snowpuppy

[Toy80]

No I just checked. I would pay 5 dollars less than what direct loans is charging me now if I had some kids I would be good to go.

[snowpuppy]

No I just checked. I would pay 5 dollars less than what direct loans is charging me now if I had some kids I would be good to go.

 

 

Or some tax deductions to your 1040.

[Saria]

No I just checked. I would pay 5 dollars less than what direct loans is charging me now if I had some kids I would be good to go.

 

 

Or some tax deductions to your 1040.

 

Interestingly, student loan interest is an above-the-line deduction, lowering AGI and - theoretically - reducing IBR payments.

[snowpuppy]

No I just checked. I would pay 5 dollars less than what direct loans is charging me now if I had some kids I would be good to go.

 

 

Or some tax deductions to your 1040.

 

Interestingly, student loan interest is an above-the-line deduction, lowering AGI and - theoretically - reducing IBR payments.

 

And that is the smart way to repay your loans.

Edited August 9, 2010 by snowpuppy