I've been reading through this forum trying to find out what I can do about my student loans. I am currently in default, and have gotten the letters telling me that they are taking my income tax return and are going to garnish my wages. The thing is, I am unemployed. I have no wages. I have never had what would be called a "real" job and I probably never will. I haven't paid in enough to social security to ever collect when I get older, I am not eligible for any benefits.

Now, I am willing to pay on my student loans, but there is no way I can afford 1% a month. Is there any reason for me to open this can of worms? If I can't negotiate a plan that I can afford and they have no way to collect from me then what is the point? I realize that the loans have no SOL. They are on my credit report, will they be there forever? Not that it matters a whole lot cause like I said I have nothing to take so I'm not exactly in a position to qualify for any credit either.

Well, do you mind me asking, why is it you don't think you'll ever have a "real job"?

You obviously went to college or you wouldn't have the loans.

Yes, I went to college and graduated magna cum laude. But I have no job skills or job experience. I've been a stay at home mom and have never had a job except for the little waitressing job I had as a teen. I tried to get a job a little over a year ago but couldn't find anything due to no prior job experience. Sure, I could work at McDonalds or something but that isn't what I would call a "real" job. I made it through the first round of applicants on one job based on my degree, made it through the 2nd round based on a test of skills but couldn't get past round 3, the interview with job experience.

And if my options are to sling hamburgers to pay off student loans for the rest of my life or just let it go, I gotta be honest, I'd rather just let it go.

Well I guess that's one option. Best of luck to you - whatever you decide.

Most students come out of college with no job skills and little to no work experience.....but they get jobs because they have to. Most rent, food and of course, student loans to pay.

You start off by temping. Obviously you are capable of learning. Receptionist, data entry, accounting clerk, call center....none of these are exactly rocket science.
Look at the job board at your local school district. There are jobs within the school systems that do not require much experience. Paraprofesional postion work in the library, lunchroom, office and some work with kids. You have kids....you have experience. Done volunteer work?? If not, maybe do some to gain work experience.

Your default is serious business and it does affect your entire family. With your loan in default, your family is ineligible for FEMA benefits. Tax returns seized, FHA mortgage ineliegiblity. Not to mention, you wont be able to help your kids out if they need additional financial aid when they go on to post secondary education.

Obviously you are married. However in this day and age, you must realize that 50% of all marriages end in divorce. That leaves you where?? On welfare.

Now is the time to diligently work on getting yourself employed and getting into repayment. You may also want to look at the Direct Loan Consolidation loan program. Since you are in default, they will automatically assign you to the Income Contingent Repayment plan. This will take into account your spouses income, but it makes the payment affordable .

Honestly I think your first step is getting a small job, even if it isn't a more desirable one. You can't gain experience from nothing. Once you've had that job for 6 months or so start reapplying for better ones and just start moving up the scale of jobs until you get what you are truly happy with. You gotta start somewhere, just like we all did.

My story is much the same, but without the student loans. I was a SAHM when the kids were young, got involved in computers because SAHM was boring. When the kids started school i had a heck of a time getting hired any where but retail and i hated working retail. I had to prove myself over and over in computer related jobs only because I was a woman (almost all the guys I worked with were self taught too). After a few yrs of working for others i decided to start my own consulting biz...

Moral of the story... if you can't find a job you like... make one.

so lets say I get a temp job or something and make $9-10 an hour. Then I go to make a payment arrangement and they include my spouses income with mine which will effectively negate every penny I make and cut into the money that we use now to pay bills. I guess I just don't see how this helps me since as of right now I am untouchable.

I am not trying to being argumentative, but I am trying to determine what the best thing for me to do in regards to my family's well being. And having to come up with child care solutions so that I can work and then not benefitting from any extra income doesn't look like it benefits my kids in the here and now.

Will the student loan default come off my credit report 7 years after the date the guarantor paid the loan holder? Or since the debt is always collectible can it stay on your report forever?

It apears to me that you are looking for someone to validate your excuses not to pay. Did you look at the Diredct Loan site?? Did you play with the loan calculators??? People all over this company work 2 jobs in order to pay all there bills including their student loans. Why should you be any different? Dad works days, mom works night and/or weekends. It is tough but that is what responsible people do. They figure out how to pay all the bills. Did you husband have student loans?? Are his being paid??

Do you live in hurricane, tornado, earthquake or flood area of the US?? Any natural disaster can hit pretty well any part of the country. Your family is currently cut off all but basic (food and water) FEMA benefits because of the default. Yes that includes your husband and your children. Does that help your families well being??

I say they will take every penny because they wont go by my income alone. They will also include my husbands income which will push the payment up. Am I not understanding the process correctly? Please correct me if I'm wrong.

Also, could you elaborate on how I am not untouchable right now? I have nothing, how do they take anything?

I am not looking for excuses to not pay. I'm not paying right now so I don't really NEED an excuse. I'd like to figure out a way to start paying it back but if they wont accept the amount I can afford then what else is there to do?

And please, if I wanted to hear about how irresponsible I am being I could call a collection agency. I came here to ask some questions, some that have still not been answered. I didnt really come here to be threatened with disaster and divorce (are you serious?).

So if someone knows the answer to this question specifically I would appreciate it: How long does the student loan default stay on my credit report?

Sidenote: Sorry about missing apostrophes, that key is not working properly on my keyboard.

Not always. If your original loan was thru a FFELP lender, it will eventually be subrogated by the USDOE and the reporting cycle starts all over again for another 7 years.

Ok....how much do you owe??

how do you know if it's been subrogated? Does it show DOE as the creditor on the report? Currently mine show the original lender and also the Guarantor.

They are currently saying I owe $72000.

So 14 years is the max it can be on the reports? If I set up payment arrangements will it start the 7 year clock again or will it stay the same as long as I stay current?

Ah, yes, I forgot about that possibilty. You think of everything, Lynn

Who is holding your loan right now?? That will tell me whether you have a FFELP loan or Direct Loan

Ok...$72k. Taking off a guestimation off your collection fees, I figure your monthly interest is around $370 per month. With interest capitalization and collection fees added back in, you will probably top $100K within 8-9 years. Once you start coming close to that magic number of $100K, that is when they start suing....particularly with loans that no longer appear on the credit report. Is your name attached to a mortgage? Hope not.

I played around with the ICR calculator thru Direct Loans. Without knowing your interest rates, I used 6.8% with direct withdrawal option for the interest rate reduction. I picked family size as 4. I picked an Ajusted Gross Income figure of $40k. Figure out yours and then play the "what ifs" game with potential wages you could possibly earn. This is what I came up with...

Summary Information: This page provides estimated monthly payments for Standard, Graduated, Extended Fixed, Extended Graduated and Income Contingent Repayment Plans to help you select the appropriate plan for your consolidation loan.


Interest Rate - Consolidation Loan 6.625%


Total Loan Balances
Total Consolidation Loan Amount $72,000.00
Total Education Indebtedness $72,000.00

For Income Contingent Repayment Plans
Adjusted Gross Income (AGI) $40,000.00
Marital Status Married or Head of Household
Family Size 4
State of Residence Continental US

Income Contingent
(see Note 2 below) 254 (months) $322.50(monthly repayment) $148,487.89 (Totlal Paid)


Being in default, you do not have any other choice but ICR but there will be several other payment plans listed. After 25 years in repayment, the balance of written off and is charged back to you via a 1099.

The $322 figure is not written in stone. The Direct Loan program is extremely customer friendly and if the payment assigned will work, they will adjust it. They will take into account daycare costs, areas of high housing costs and high medical bills.

Play with the calculator.



https://loanconsolidation.ed.gov/loancalc/s...k=startCalculat

my name is not on a mortgage. Seriously I have nothing so being sued doesnt particularly scare me. You cant get blood from a turnip ya know?

Okay, so say I do the ICR to get the loan rehabbed. Is that 6 payments, 9, 12? And then after that if I pay for 25 years they write off the rest? That gives me hope.

I honestly do not know who holds the loan right now. I think it is DCS but I have gotten so many different letters that I am not sure.

No the ICR is for a Direct Loan Consolidtion. Standard payment for rehab will be $720. They should let you do reasonable and affordable payments for rehab using your husbands income as a base. However, since you dont care about the credit aspect, I would suggest you go straight to consolidation.

DCS is a CA. On the letters it should say who they are collecting for.

sorry it took me so long to get back to this, 4 kids keep me pretty busy!

The collection letters say they are collecting for the guaranty agency so I'm guessing that means the DOE hasn't taken it over yet. I'm still trying to figure out what to do. We already pay on dh's loans and just cannot afford to make another huge payment every month. I hate to let it go, cause I know that it'll just get bigger but when we get dh's paid off we'll be able to work on mine. And we may have a kid or 2 out of the house by then and my working wouldn't be such a big deal.

This whole situation just feels so hopeless.

From my understanding, if you rehab the loan and make the required payments for a specified amount of time, the default can be and should be taken off before 7 years.

As for FEMA help, that's laughable to me because they don't appear to do too much to help any tax paying citizens. Judging by the people dying in New Orleans 3 years ago and need I mention all the bad press about how they're treating the victims of the Gulf Coast in their "recovery efforts". You're probably better off without governmental help and doing for yourself instead. A lead-in to you should really look at getting a job. You have debts and you need money to make them go away. Point blank.

we can't consolidate ours together though right? His loans are about half of mine so his are way more affordable. Also, since he has income his wages would be garnished if we weren't paying them. So mine have taken the back burner.

If we both consolidated would they take the payments for both into consideration when deciding the amount of monthly payment?

Yes, they will take ito consideration both of your payments under the Icr.

You know, life has a funny way of never working out the way you planned it.

What if, God forbid, your husband passed away tomorrow? What would you do then? Will his life insurance cover all of your outstanding debts? If not, you would HAVE to take a job, or you would HAVE to go on welfare. At that point, the government would garnish your wages or they would take a cut of your welfare payments, so you would be in a worse situation than you are now. The standard "You can't get blood from a turnip" doesn't apply when you owe the government money. They won't forget about you if you lie low, and they don't care what sad story you give them when they come to collect - they've heard it all.

You were aware of this debt when you started having children and decided to stay home with them. When you decided to be a SAHM, this should have been factored into your bills and if your husband's income can't cover it, then you probably should have explored other options.

All of us are here because we've been in the same boat as you and just want to let you know that it's better to get it taken care of sooner rather than later. As far as your credit report, well, in my own experience, my defaulted SL has never NOT been on my credit report, and I have been out of school since 1987 - so YMMV when it come to that.

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Exactly my thoughts!!! Unless you choose to live under a rock, marriage is NOT forever . Divorce and death....it happens all the time.
Being the SAHM does not mean that your debts are any less important than his and so many woman seem to get into this rut. Then they divorce and his credit is perfect and her's is in the toilet. I hate to say it, but having kids is an excuse, especially when the loans came first. You do what other people do....one spouse works days, the other nights and/or weekends.

You can consolidate together if your DH is willing to take on the liability of your student loans.

I consolidated my DH defaulted student loan with one of my small good ones while I was still in college so that he could go back to school. I had to agree to be responsible for paying it back which I was perfectly willing to do since we both have decent jobs and both incomes go towards all the bills.

If DH doesn't want to consolidate all together, he could change his repayment plan to Income Contingent Repayment (ICR). That might lower his to help afford ICR payments on yours.

I strongly suggest thinking long term about the ramifications of not paying your student loans. With 4 kids that will be going to college sooner than you might think, you will be unable to apply for any student loans for them if yours are still in default. That means you'd have to pay full tuition out of your pockets until you take care of your loans.

Thinking short-term gets many of us in trouble when it comes to finances. Even if the credit report doesn't matter to you, I would hope you might take a step back and think about the long-term effects on your children.

Both need to be on the ICR plans.

Also, the parents being in default, does NOT affect the child's ability to get loans. However the parents will not be able to get PLUS loans or even cosign on private student loans.

They must've done away with spousal consolidation RIGHT after we did it because I believe it was late 2004 when we did it - just a little over 2 years ago.

Thanks for correcting me on the borrowing for kids. I know that children's student loans often don't cover 100% of the first and second year of college (depending on where you go and especially if you have to pay room and board to live on campus) which leaves the parents getting the PLUS loans and such, which they are ineligible for.

I saw that they appear to be spending every penny on bills with no room to breath and I guess just wanted to make the point that not paying her loans WILL affect her children going to college because they will probably have to pay something out of pocket which they might not be able to afford at that time if they can't afford any extra payments now.

I wanted to express my opinion that OP should be considering these consequences as she decides how to handle her loans going forward.

Wow, judge much? You know it is possible to provide helpful information without judging those in need of the help. I do appreciate the info that I have gotten here, especially from Lynn, but I have also had to swallow quite a few nasty, unnecessary comments. And you know, since I described my situation as hopeless, maybe providing some hope that there is a light at the end of this tunnel would go a long way. Instead, I've got people on here questioning my decision to be a SAHM. Really, completely uncalled for.

Having said that, I posted here, I asked for help, and I am a big girl. And I will answer questions that are asked so let me know if it's rhetorical.

Let's see, should my dh die tomorrow. Well, his loans wouldn't have to be paid on anymore so there goes that bill. And yes, his life insurance would cover all my outstanding bills including my student loans. Would I be able to live forever off of it? No, I would have to get a job and do the best I could but I would have the student loans paid off then so I guess the government bogeyman won't be out to get me.

Let me clarify since there are some pretty wild assumptions being made here. No I wasn't aware of this debt when I started having kids and decided to stay home with them. See, I was a mom before I ever took my first college course. I managed to go to school and complete my degree while being a SAHM and homeschooling my own kids. You said above how life doesn't always turn out as planned. Do you think I don't know that? And I would bet I know more about how little the government gives a rat's behind than anyone here has any idea about. I've been screwed over but good by the 'system' and it is a big reason why my best laid plains didn't work out. But hey, the government doesn't care about sob stories so that isn't what matters. But since they are so callous and uncaring, can you see why I don't want to deal with them right now? When they can't currently get something from me. Why I wouldn't want to wait until I get my kids out on their own before I tackle this beast? They won't have to suffer later, but they would right now. And I gotta say, I care a whole lot more about my kids than I do whether Uncle Sam ever gets a red cent from me.

I've said before but I get the impression it wasn't read so I'll say it again. I want to pay these back. just not at the expense of my kids. Lynn provided hope by explaining that I could do ICR and they would consider both of our loans in determining the payment. If they'll do that, then there may be a solution to this. Which is what I came here for, a possible solution, not to have every part of my life judged by someone who knows absolutely nothing about it.

Sunshine, I appreciate what you are saying about the kids needing help paying for college. And when that day comes, it is quite possible that I will find employment if to do nothing else but pay tuition. But, my kids know that college is not a guaranteed right. If they want it, they have to work for it too, they are expected to get scholarships, do work study, whatever it takes. Me and Daddy won't be there to pay all of the bills. It's one reason that I am homeschooling, the public education here is horrendous and for them to make it in the world they need a better education than what they were getting. So I took that on and have never looked back. There is a new charter school that is opening up here next year that has peaked my interest so I may send them to do that if the program turns out to be as good as what I've seen so far. But I most certainly do not expect that the government is going to provide them what they need.

No rocks here, just a really solid marriage of 16 years. Death, can't control that one, but you know part of what makes a successful marriage is not thinking every other minute that your spouse is going to run out on you. I realize that there are some really sorry men out there, but I found one of the good ones. It's one of the areas of my life that has worked out perfectly. And I know that I am lucky in that regard.

His credit isn't perfect, my scores are actually higher than his. We went through something quite terrible a few years ago and it really drained us financially. We're recovering slowly but it isn't an instant fix.

And I don't use my kids as an excuse. the loans didn't come first. They came first and as long as I am alive they always will.

You know, I am sorry that you feel that you are being judged here - you are not. You came here to ask questions and many of us - BASED ON OUR EXPERIENCES - have answered you.

I, too, married "One of the good ones", was married for 10 years, and didn't spend one single minute worrying that he was going to run out on me. I assumed our marriage would last forever and treated our finances as such. Then one day my husband fell and broke his ankle and could not break his addiction to the narcotics that the doctors prescribed for the pain. Then our daughter died and he sank into a deep depression and just focused on where his next high was coming from. I never saw it coming. His parents, his family, my family, our friends never ever expected it of him. Of course we separated and our divorce is just about final, but not long after I went out and got a job (a "great" job, despite the fact that I do not have a college degree - I did not have to 'settle' for McDonalds, although there certainly is no shame in honest, hard work) BAM, there was the government, threatening to garnish my wages.

I defaulted on my loan in 1990, when my balance was around $7500. By the time the government caught up to me, 17 years later, it had grown to $22,000. The $200 I had to pay every month for 9 months really hurt my son and I, but I had no choice. I consider myself blessed that they DID accept $200/month, which was much cheaper than if they'd taken 15% of my wages. My fiance's brother drove a truck for over 20 years, then developed lymphedema in his legs. He had come from over-the-road to a dedicated route a few years before and had gone back to school. When he became disabled and qualified for SSDI, guess what? The government took $150 of his $1000 check each month for two years for his student loan. They didn't care that that left him only $850 to live on, and his rent was $500/month.

I too had that "Hey, the government didn't care when I was on welfare, having left my (first) abusive husband - they wouldn't work with me, so I'll be danged if I'm gonna worry about when they'll get their money!" attitude. I REGRET IT NOW - now that I am 40 and my son is about to graduate and I will have more freedom in my life, I know that I have to budget that $200/month for the next 10 years, when it could so easily have been taken care of long ago.......

I give you kudos for teaching your children that there is no free ride through college (unless you get a full scholarship) and that they will probably have to work hard to make it through.

I paid for every penny of college on my own. My mother threw me out shortly after high school graduation and my father's landlord wouldn't allow me to live with him. I had to file some extra affidavits with the university in order for them to consider me emancipated and not include my parent's income when evaluating my FAFSA. I went to school for about a year, and then some life changes kept me from going back. I paid off those loans with a nice tax refund a couple years later (the government took it). Then I went to a business school for a 2-year degree. After graduating, I managed to pay off those loans. Then I finally went back to work on my bachelor's, and now I am in graduate school.

What I'm saying, is that I understand how hard it is to work through college on your own and it is good that you do want to pay off your loans.

I hope the info Lynn gave about ICR's will help you and DH get into a position where you can be paying on both loans.

Good luck to you.

Then maybe the laws need to be changed to be more helpful to the average citizen.
The government is doing alot of things with our money many people question.

I think it is very helpful to the average citizen to be able to borrow money to go to college, regardless of your credit history, at a low rate of interest.

I disagree with the fact that, although I was living at school, because I came home now and then during the year and for the summer, the government based my student aid on my parents' income, disregarding that they gave me NOTHING towards my education. That is something I would like to see changed, and have written letters attempting to get that changed.

However, the bottom line is, the government lends this money to people from OUR taxes, and when people fail to repay that loan, it affects the future of the student loan program. Why should my child be penalized because someone else CHOOSES not to repay their loan??

That makes sense - I just have to laugh now, because my dad constantly complains that I don't have a college degree, yet I had to leave college after 2 1/2 years because, based on their income, I didn't qualify for enough aid to pay my tuition.

So dh said tonight that he could move to 2nd shift if i get a job during the day. We just have to determine if he will lose more in overtime hours than we would be gaining with my income. I sent my resume in for a job opening as a day care director. I actually feel pretty qualified for that but I have no idea what the pay is like. So, I don't know, we'll see what happens.

and to completely hijack my own post in my own thread, I have to ask. Lynn, do you hot or cold process?

Only cold process! Hot process is too much damn work!

I agree! I miss soaping. maybe someday I'll get back to it.