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  1. #1
    Join Date
    Nov 2008
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    8

    Default Cannot Pay Private Student Loans

    Sorry, I think I kinda hijacked a thread before, so I am going to start my own. Any input would be greatly appreciated. I currently owe $60k in private student loans and $30k in federal student loans. My monthly payment on my private student loans are $600 per month for 20 years. I cannot afford to pay $600 per month as well as my other living expenses. What happens when I do not pay? I know there is no bankruptcy protection, but when they sue me, can a judge mediate and help me to get more reasonable payments? Also, I am in the state of Indiana if that makes a difference. Thanks in advance for any comments.

  2. #2

    Default Re: Cannot Pay Private Student Loans

    I assume you have $60k at about 10.5% and $30k at about 6.8%, right? If you are working and default and a judgment is issued against you and then a garnishment order was issued, my belief is that you would be forced to pay about 25% of net disposable which is roughly about 10% gross, give or take. So are you making about $70-90k/year? You could ask Citi for a forebearance, but of course that adds to your debt. Worse case if you don't pay for a year, you would add about another $6,000 which you could amortize over 20 years. What is your current job and what are your job prospects? Out of curiousity, why did you take on $90k for a job? I looked at the Citi debt calculator site and they provide a pretty good estimate of what a borrower's monthly payments would be based on interest rates. Do you feel as if you were deceived somehow?
    Personally, I think you should try to treat each loan as if it was a credit card and focus on paying off one and then another.

  3. #3
    Join Date
    Sep 2005
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    98,846

    Default Re: Cannot Pay Private Student Loans

    Are your private student loans federally guaranteed?

  4. #4
    Join Date
    Nov 2008
    Posts
    8

    Default Re: Cannot Pay Private Student Loans

    Quote Quoting Rosalynn200
    View Post
    I assume you have $60k at about 10.5% and $30k at about 6.8%, right? If you are working and default and a judgment is issued against you and then a garnishment order was issued, my belief is that you would be forced to pay about 25% of net disposable which is roughly about 10% gross, give or take. So are you making about $70-90k/year? You could ask Citi for a forebearance, but of course that adds to your debt. Worse case if you don't pay for a year, you would add about another $6,000 which you could amortize over 20 years. What is your current job and what are your job prospects? Out of curiousity, why did you take on $90k for a job? I looked at the Citi debt calculator site and they provide a pretty good estimate of what a borrower's monthly payments would be based on interest rates. Do you feel as if you were deceived somehow?
    Personally, I think you should try to treat each loan as if it was a credit card and focus on paying off one and then another.

    Hello, I have $60k at about 9% variable interest rate, and $30k in federal student loans at 5% fixed. I am not with Citi, the original loans were made with Chase, and they are now being serviced by AES. I am out of forbearance/deferment time, so that is not an option. No, I do not make $70-90k per year. If I did, I wouldn't have trouble paying $600 per month. I make $34k per year, and I have a bachelors degree in Liberal Studies, so I do not see my income increasing very much in the near future.
    I am just curious what my options are if I have any. I would like to pay these loans, but I cannot realistically pay $600 per month just in private student loans. Thanks

  5. #5
    Join Date
    Nov 2008
    Posts
    8

    Default Re: Cannot Pay Private Student Loans

    Quote Quoting Mr. Knowitall
    View Post
    Are your private student loans federally guaranteed?
    Hi, I am not sure if they are federally guaranteed. They are loans from Chase, and they are now serviced by AES. Why do you ask? Is there something I can do if they are not federally guaranteed? Thanks!

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