Reply to involuntary collections of student loans

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]We are headed back to debtors prison when they deduct it from your pay and people end up on the street. [/quote]

Income based repayment plans are   universally available and have been common for years in the student loan world. If a young professional makes 40k annually and therefore the $1,500 monthly installment payment on their 200k student loan balance isn't affordable, all they have to do is contact the loan servicer and document the need for a modified income based minimum payment.

Canceling debt is never a wise long  term solution. Ii

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Unless you are a bank, airline, small business, farmer, automaker…[/quote]

We did that and the only thing they would offer was paying just the interest which was almost the same amount. Even the standard 1500 monthly payment pays like $8 towards principal. Student loans are a total racket and they've been structured in a way to never pay them off. [/quote]

Exactly. I borrowed about $100k for law school at a well ranked state university. I sought (and landed!) a prestigious job with the federal government. I requested and was placed on an income based repayment plan. My monthly payments ranged from about $900 to about $1400 a month, as my income increased, over the 10 years I made regular monthly payments. My payments were primarily interest, a small amount of principal, and the interest was compounded annually. By the time the balance of my loan was forgiven under the public service loan forgiveness program, I’d repaid about $15k more than the amount I borrowed initially. The principal debt that was forgiven was almost twice the amount I borrowed initially, and there was close to another $100k in interest still owed. If I didn’t have PSLF forgiveness I would never have been able to get out from under that debt. I knew when I started there income based plan it was a racket, but without it I would have defaulted immediately because the standard monthly payments were astronomical. Students loans are basically predatory lending.

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