Student Loan Debt Clock

Wednesday, May 9, 2012

Navigating through your Student Loan Nightmare!

One important note, do not just walk away from your Student Loans; they never go away, NEVER, only when your dead do they go away. Better to suck it up and deal with them head on.

Several tools you will need. A digital recorder, a Trac phone with pre-paid phone cards, you do not want to give anyone in the student loan agency or entity your home phone number, the collection agencies will drive you nuts, should you default. State you are recording your phone calls, ‘for training purposes,’ that is what they say when they record you, right, it is illegal to record someone who is not aware of it, the previously mention advice will protect you, and may give you fodder for a law suit for telephone harassment.

I have been living in the process of student loans, default, restructuring my default, and consolidations; that I forgot what it was like just starting this process. When I was in default, I had the opportunity of making 10 payments and then my default status was lifted. I was able based on my income to make $50.00 payments a month, which is when my student loan balance was a significantly lower than it is now.

#1 thing to do is consolidate all your loans if they are unimaginable. I mean you don’t want to have to write 30 checks a month. However, just understand there is a hefty price to pay in the consolidation process, my loans currently adds up to $198,000.00 after the student loan consolidation, because of the added interest. But, I do recommend it. Because, god-forbid should I default again, I won’t have 30 different collection agencies calling and harassing me if it is in one lump sum, I will just have to deal with one collection agency.

Plus, my new motto now: I will call a Senator or Congressperson every time I get a call from those in the student loan collection agency; can you imagine if everyone made calls to their State Representatives who has student loans for every call they got from collection agencies, laws would change. Here is a comprehensive list of those numbers and addresses of all Senators and Congress persons:

Here are a few options or the steps I took:

 “To begin the online application process, you will be required to log on to with your student aid credentials (including name, social security number, date of birth and your Federal Student Aid PIN). After logging on to the website, you will click on the word “here” in an Alert message located on the top right side of the page to begin the online application process.”

I had to go to NSLDS and get every loan I had ever taken out and supply that information on a pre-printed printout of names of loan servicers, who holds the loans, so to speak, and amounts. You will need your PIN #, so if you have misplaced your PIN, ask for your PIN Number to be sent directly to you.

Here is the PDF you can print and fill out for your student loan consolidation: I needed 5 pages of this form, print extras, they will not accept forms with mistakes.

Here is another PDF for student loan consolidation within 180 days after your initial student loan consolidation; say for instance you took more classes after you had consolidated your student loans originally:
Now, I  just sent out another application to have 4 classes added into my original consolidation loan (I just finished my last classes ‘for now’ May 6, 2012,) and it will take a little while for the paper work to be processed. After that, I will apply for an Income Repayment Plan (IBR). I will keep you apprised of the outcome of The IRB process.

If you are in a no-default status, according to are many options: IBR, ICR, Standard Repayment, Extended Repayment, Graduated Repayment, and Income-Sensitive Repayment Plan:

  •  Income Based Repayment (IBR) (Direct Loans Only)
What is Income-Based Repayment? “Income-Based Repayment (IBR) is a repayment plan for the major types of federal student loans that caps your required monthly payment at an amount intended to be affordable based on your income and family size.” 

“Income Based Repayment is a new repayment plan for the major types of federal loans made to students. Under IBR, the required monthly payment is capped at an amount that is intended to be affordable based on income and family size. You are eligible for IBR if the monthly repayment amount under IBR will be less than the monthly amount calculated under a 10-year standard repayment plan. If you repay under the IBR plan for 25 years and meet other requirements you may have any remaining balance of your loan(s) cancelled.”

  • Income Contingent Repayment (ICR) (Direct Loans Only)
“This plan gives you the flexibility to meet your Direct LoansSM obligations without causing undue financial hardship. Each year, your monthly payments will be calculated on the basis of your adjusted gross income (AGI, plus your spouse's income if you're married), family size, and the total amount of your Direct Loans. Under the ICR plan you will pay each month the lesser of:

1.     The amount you would pay if you repaid your loan in 12 years multiplied by an income percentage factor that varies with your annual income, or

2.     20 percent of your monthly discretionary income.”

  • Standard Repayment
“With the standard plan, you'll pay a fixed amount each month until your loans are paid in full. Your monthly payments will be at least $50, and you'll have up to 10 years to repay your loans.”
  • Extended Repayment
“Under the extended plan, you'll pay a fixed annual or graduated repayment amount over a period not to exceed 25 years. If you're a FFEL borrower, you must have more than $30,000 in outstanding FFEL Program loans. If you're a Direct Loan borrower, you must have more than $30,000 in outstanding Direct Loans. This means, for example, that if you have $35,000 in outstanding FFEL Program loans and $10,000 in outstanding Direct Loans, you can choose the extended repayment plan for your FFEL Program loans, but not for your Direct Loans.”
  • Graduated Repayment
“With this plan, your payments start out low and increase every two years. The length of your repayment period will be up to ten years. If you expect your income to increase steadily over time, this plan may be right for you.”
  • Income-Sensitive Repayment Plan (FFELSM Loans only)
With an income-sensitive plan, your monthly loan payment is based on your annual income. As your income increases or decreases, so do your payments. The maximum repayment period is 10 years. Ask your lender for more information on FFEL Income- Sensitive Repayment Plans.

Now thing are not looking too bleak are they? See there are options for your own personal student loan debacle. Never give up hope or they win. One on my mottos, “Never Die: Never Surrender,” the saying is a little out there, but that is how I manage my own student loan debacle and everything else in life. There is no way I will every let the ‘plutonomy’ win, just because I am a ‘precariat’! An article, by Noam Chomsky: fascinating read!

Now for the good stuff, what you need to know, to have your student loans forgiven should you follow particular routes:

According to  copy & pasted directly from webpage:

Loan Forgiveness

“Under certain circumstances, the federal government will cancel all or part of an educational loan. This practice is called Loan Forgiveness. To qualify, you must:
  • Perform volunteer work;
  • Perform military service;
  • Teach or practice medicine in certain types of communities; or,
  • Meet other criteria specified by the forgiveness program.
To find out whether you qualify for loan forgiveness, talk to the human resources staff at your employer.
See also FinAid's Public Service Loan Forgiveness section.

Some, but not all, loan forgiveness is excluded from income. See Taxability of Student Loan Forgiveness for additional details.

Volunteer Work

These volunteer organizations offer loan forgiveness:

AmeriCorps. Serve for 12 months and receive up to $7400 in stipends plus $4725 to be used towards your loan. Call 1-800-942-2677.

Peace Corps. Volunteers may apply for deferment of Stafford, Perkins and Consolidation loans and partial cancellation of Perkins Loans (15% for each year of service, up to 70% in total). Volunteers make a real difference in the lives of real people with two years of service in more than 70 developing countries. Contact the Peace Corps at 1111 20th St., NW, Washington, DC 20526 or call 1-800-424-8580 or 1-202-692-1845.

Volunteers in Service to America (VISTA). Volunteer with private, non-profit groups that help eradicate hunger, homelessness, poverty and illiteracy. Provide 1700 hours of service and receive $4725. Call 1-800-942-2677 or 1-202-606-5000.


Students who are in the Army National Guard may be eligible for their Student Loan Repayment Program, which offers up to $10,000. (Note, the military and veterans' associations provide many scholarships and tuition assistance programs. See the section on Military Aid for details.)


Students who become full-time teachers in an elementary or secondary school that serves students from low-income families can have a portion of their Perkins Loan forgiven under The National Defense Education Act. This program forgives 15% of your loan for the first and second years of teaching service, 20% for the third and fourth, and 30% for the fifth. Contact your school district's administration to see which schools are eligible.
Mississippi teachers who currently have their Alternate Route Teaching License and teach in a shortage area may be eligible for the Teacher Loan Repayment program. Visit the Mississippi Office of State Student Financial Aid web site at or call 1-601-432-6997.
The American Federation of Teachers maintains a list of other loan forgiveness programs for teachers.

Legal and Medical Studies

Many law schools forgive the loans of students who serve in public interest or non-profit positions. For more information, contact Equal Justice Works (formerly the National Association for Public Interest Law) at 2120 L Street, NW, Suite 450, Washington, DC 20037-1541 (phone 1-202-466-3686 or fax 1-202-429-9766). The American Bar Association (ABA) also has a summary of Loan Repayment Assistance Programs (LRAP), Directory of Law School Loan Repayment Assistance Programs (LRAP) and State Loan Repayment Assistance Programs.

The US Department of Health and Human Services offers loan forgiveness programs through the National Health Service Corps and the Nursing Education Loan Repayment Program. These programs offer loan forgiveness to physicians and registered nurses who agree to practice for a set number of years in areas that lack adequate medical care (including remote and/or economically depressed regions).

The US National Institutes of Health's NIH Loan Repayment Programs repays up to $35,000/year of student loan debt for US citizens who are conducting clinical medical research.

The US Department of Agriculture's Veterinary Medicine Loan Repayment Program (VMLRP) offers loan forgiveness of $25,000 per year for three years for veterinarians who commit to work in a veterinary shortage area for three years. The application deadline is June 30.

If you're a California resident, contact the Office of Statewide Health Planning and Development (State Loan Repayment Program, 400 R Street, Room 330, Sacramento, CA 95811; 1-916-326-3745). Other states may have similar programs.

Many hospitals and private healthcare facilities use loan forgiveness to recruit occupational and physical therapists. Contact the American Physical Therapy Association (1111 North Fairfax St., Alexandria, VA 22314-1488; 1-800-999-2782) or the American Occupational Therapy Association (P.O. Box 31220, 47200 Montgomery Lane, Bethesda, MD 20824-1220; 1-301-652-2682).

Other loan repayment programs for medical school students include:
  • Nicholas J. Pisacano MD Memorial Foundation Inc. (American Board of Family Practice)
  • Disadvantaged Health Professions Faculty Loan Repayment Program
  • Indian Health Service (IHS) Loan Repayment Program
  • US Air Force, Army, and Navy Financial Assistance Programs
The American Association of Medical Colleges (AAMC) maintains a database of state and other loan repayment programs for medical school students.

Other Paths to Forgiveness

Students who receive the Michael Murphy Loan to study law enforcement, law, probation and parole, penology, or other related fields are eligible to work off one-fifth per year as a State Trooper (or related law enforcement official) in Alaska. Contact the Alaska State Troopers, Director's Office Scholarship Fund, 5700 East Tudor Rd., Anchorage, AK 99507; 1-907-269-5511.

Maryland state and local government employees who earn less than $40,000 gross annually may be eligible for a loan assistance/repayment program to study law, nursing, physical and occupational therapy, social work and education. Contact the Maryland State Scholarship Administration, 16 Francis St., Annapolis, MD 21401; 1-410-974-2971 x146.

Federal Government Loan Forgiveness Programs

Perkins loans and Stafford Loans can be cancelled for full-time service as a teacher in a designated elementary or secondary school serving students from low-income families, special education teacher (includes teaching children with disabilities in a public or other nonprofit elementary or secondary school), qualified professional provider of early intervention services for the disabled, teacher of math, science, foreign languages, bilingual education, or other fields designated as teacher shortage areas, employee of a public or non-profit child or family service agency providing services to high-risk children and their families from low-income communities, nurse or medical technician, law enforcement or corrections officer, staff member in the educational component of a Head Start Program, service as a Vista or Peace Corps Volunteer and service in the Armed Forces (up to 50% in areas of hostilities or imminent danger).

See also the US Department of Education's pages on Cancellation/Deferment Options for Teachers and Cancellation for Childcare Providers, as well as the Teacher Loan Forgiveness Form.

The US Department of Education maintains a database of low-income schools eligible for teacher loan cancellation for Perkins and Stafford loans.

Secondary school math and science teachers, and elementary/secondary school special education teachers who commit to working in high-need schools for five years can obtain up to $17,500 in Stafford loan forgiveness. They must teach full time for five consecutive years in a qualifying low-income school and be "highly qualified". (The Taxpayer-Teacher Protection Act of 2004, HR 5186, increased the amount of forgiveness from $5,000 to $17,500 on October 30, 2004.)

Visit the HRSA web site for information on Nursing Education Loan Repayment
The Federal Student Loan Repayment Program allows federal agencies to establish loan forgiveness programs to help recruit and retain employees. This is technically a loan repayment program and not a loan forgiveness program, as the agencies make payments directly to the loan holder and the payments represent taxable income to the employee. The agencies can repay up to $10,000 in Federal student loans per employee per calendar year, with a cumulative maximum of $60,000 per employee. Employees must agree to work for the agency for at least 3 years. For more information, see the Student Loan Repayment Program FAQ. This program is authorized by 5 USC 5379 (alternate link) and 5 CFR 537. Federal Employee Student Loan Assistance Act (P.L. 108-123, 11/11/03) increased the repayment limits to $10,000 per employee per year and $60,000 per employee cumulative. (The federal government's jobs site is located at They also have a site focused on jobs for recent graduates.)

History of Loan Forgiveness Programs
  • 1958: The National Defense Student Loan Program (a predecessor of the Perkins loan program established by the National Defense Education Act in 1958) includes loan forgiveness provisions.
  • 1968: Alaska had a loan forgiveness provision for state loans if the borrower remained a state resident for four years after graduation. The forgiveness was not career-specific. The program ended in 1987, with the transition from the state general fund to capital markets in 1988.
  • 1982: The military's Student Loan Repayment Program started on October 1, 1982 after a demo program in FY1981.
  • 1987: The National Health Service Corps (which was established by the Emergency Health Personnel Act in 1970, PL 91-623) started its loan repayment program.
  • 1988: Start of Maryland's Janet L. Hoffman Loan Assistance Repayment Program (LARP) for public service attorneys.
  • 1993: AmeriCorps established by the National and Community Service Trust Act.
  • 1998: Stafford loan forgiveness for teachers established starting for loans originated on or after 10/1/1998.”

If you see I have omitted any information that is needed to help you on your journey, please leave a comment. And this blog link along if this information if it was useful to you.

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