This is the second in a series of Student Loan Horror Stories. These are the types of stories that come to my website, StudentLoanJustice.Org. You can read more there.
I'm throwing two up tonight, one from Brit in California, the Second a short one from D.A. in Texas.
Brit (California)
Q: How does the American middle class dream of affordable higher education become a nightmare?
A: Default a student loan.
Original loans=$26,000
Amount paid to date = $27,000
Current amount owing = $70,000
Synopsis:
Multiple loans as a graduate student attending Cal State Northridge. Full-time through 1993 in graduate school, no problems, just sailing along. I lost my dwelling in the '94 Earthquake, and dropped down to less than 1/2 time. I was put into default by Sallie Mae. Wrote numerous letters to CSAC & loan Co. (AFSA) that due to hardship, I'd be dropping below full-time. To no avail. Returned full-time in Fall '94 thru Sp.'95 full time, sent numerous letters (all certified mail), "sorry, but can't help." I've been fighting this since then. Have all documentation, but it's useless. Every year (thru 1997), I would ask for a dispute hearing, and was answered with either a garnishment or judgement. I Finally gave up.
Original loans $26,000, now over 70,000. Paid over 27,000 in garnish $ tax intercept, lost my scholarships (PhD), loan forgiveness programs, and chance at a fellowship. This hurts me particularly since I taught at an inner city school in Los Angeles for 5 years in the expectation that my loans would be forgiven.
I've completed 2 master's degrees since this nightmare, and work at a college (JC) as a professor/counselor. Made the mistake of contacting Scott Williams & EdFund. I offered a settlement, also, but no bite. Instead, Edfund has increased the amount of my wage garnishment, and raised my interest up to nearly 20%
I left off of the synopsis all the anguish, the embarassment, credit problems, anxiety, etc.( need I go on?)
All I want to do is pay my loans at a reasonable amount, and get back to my life.
D.A. (Texas)
I don't have all the facts and figures about my situation but here's a synopsis. I graduated from chiropractic school (1989) and defaulted on my federal student loans (for the same reasons that others have had to default) that totaled approximately $40,000 (in 1989) and now total $320,000 (based on a collection agency's claim in 2005). I can't renew my license to make a living (much less make payments (they wanted $800 per month in 1996) on the loans) and have experienced feelings of hopelessness, despair, no self-esteem, depression, suicide, etc., etc.