Student Loans, Question #758
March 9, 2021 7:08 AM Subscribe
So I should probably just go RTFA but I just spoke to Navient and they told me my loans are not eligible for the Covid deferral through September because that is only valid for loans taken out after 2010 (or whatever date she mentioned). Have you had luck with some professional of some kind helping with yours?
After very, very stupidly taking many loans for a humanities master's degree, followed by 15+ years of shitty temp jobs while the loans ballooned, I got a decent job and have paid about $600/month for 10 years. The total is still very high five figures until I don't know when.
I have pushed them off entirely during this pandemic and as a result, I finally have one of those emergency funds everyone always says we should have. (I've also done the 3% retirement match for the same 10 years so have a low five figures in there and I'm pretty sure it's a bad idea to use that to pay student loans.)
They probably have a higher interest rate than they should or could, but frankly I have just been avoiding the whole business. I realize this is bad and stupid.
All I've ever thought about them is that I will be very old and they will take student loan payments out of my social security until I am dead. I am single and 52 and should talk to someone about the best way to handle them. Who is that person I should talk to, how much should I expect to pay them and what can they do? I have read some of the recent student loan questions, apologies if a good answer is in there and I missed it.
After very, very stupidly taking many loans for a humanities master's degree, followed by 15+ years of shitty temp jobs while the loans ballooned, I got a decent job and have paid about $600/month for 10 years. The total is still very high five figures until I don't know when.
I have pushed them off entirely during this pandemic and as a result, I finally have one of those emergency funds everyone always says we should have. (I've also done the 3% retirement match for the same 10 years so have a low five figures in there and I'm pretty sure it's a bad idea to use that to pay student loans.)
They probably have a higher interest rate than they should or could, but frankly I have just been avoiding the whole business. I realize this is bad and stupid.
All I've ever thought about them is that I will be very old and they will take student loan payments out of my social security until I am dead. I am single and 52 and should talk to someone about the best way to handle them. Who is that person I should talk to, how much should I expect to pay them and what can they do? I have read some of the recent student loan questions, apologies if a good answer is in there and I missed it.
There's no start date tied to the current federal loan forebearance. My loans are 2004-2017 and are under it now. If any of them are Perkins or FFEL loans, those aren't eligible, unless you consolidate them into a regular federal loan, but otherwise all your federal loans should be. Do you maybe have private loans in there as well? Escalate for sure.
posted by assenav at 8:06 AM on March 9, 2021 [2 favorites]
posted by assenav at 8:06 AM on March 9, 2021 [2 favorites]
My wife has loans that are at least 25 years old, and she has the deferral.
posted by NotLost at 8:17 AM on March 9, 2021 [1 favorite]
posted by NotLost at 8:17 AM on March 9, 2021 [1 favorite]
Response by poster: Thank you for the replies. But I spoke to Navient again and they said only Federal Direct Student loans are eligible under the directive. Mine is apparently the other kind of federal loan, the FFEL or Federal Family Education Loan program, and lenders have the right to offer the forbearance or not.
posted by Glinn at 8:29 AM on March 9, 2021
posted by Glinn at 8:29 AM on March 9, 2021
Best answer: This is what I found on studentaid.gov's COVID suspension FAQ: https://studentaid.gov/announcements-events/coronavirus
The fourth question down mentions you can use direct loan consolidation to move your FFEL loans into a category where they'll be eligible for the COVID relief (but may also make them higher-interest). I've never done this, so don't have any further advice, but maybe that is something to all about on another call.
posted by augustimagination at 11:05 AM on March 9, 2021 [1 favorite]
The fourth question down mentions you can use direct loan consolidation to move your FFEL loans into a category where they'll be eligible for the COVID relief (but may also make them higher-interest). I've never done this, so don't have any further advice, but maybe that is something to all about on another call.
posted by augustimagination at 11:05 AM on March 9, 2021 [1 favorite]
Best answer: Echoing augustimagination. It might make sense to consolidate your older FFEL loans into a Direct Consolidation Loan. For example, you can then do income-dependent repayment and likely pay a lot less than $600/month.
You can try TISLA, The Institute of Student Loan Advisors, for free advice. I have not used them personally, but their founder, Betsy Mayotte, gives a lot of advice on reddit studentloans and appears to know what she is talking about. They would be my first stop.
Good luck!
posted by 8603 at 11:24 AM on March 9, 2021 [1 favorite]
You can try TISLA, The Institute of Student Loan Advisors, for free advice. I have not used them personally, but their founder, Betsy Mayotte, gives a lot of advice on reddit studentloans and appears to know what she is talking about. They would be my first stop.
Good luck!
posted by 8603 at 11:24 AM on March 9, 2021 [1 favorite]
Best answer: So. The federal government can only suspend payments for the loans it owns. That's all the Direct loans, which is all federally-backed loans made since mid-2009 as well as a minority of them before that, plus the FFEL loans that it's acquired (it went on a massive FFEL buying spree in connection with the 2007-08 crisis). Other FFELs are held by individual creditors. Many of those were strong-armed by the states into also suspending payments, but not all. Sounds like you're one of the unlucky ones.
But not irredeemably so! It is fairly straightforward and free to consolidate your FFELs into the Direct program. Direct loans have expanded income-driven repayment programs (FFEL has only one program, IBR) and eligibility for Public Service Loan Forgiveness. Most people will benefit from consolidating their FFELs into Direct loans. There are a few exceptions, though. If your FFELs are of a certain vintage, the interest rate may be quite low compared to that of Directs, so you should compare that. Also, if you are close to IBR forgiveness (if you were, you'd probably know), it might not be a good idea.
Once you consolidate, you should be able to take advantage of payment suspension, as well as seeing if you're eligible for a better income-driven repayment plan. Also...if any across-the-board forgiveness does take place, it's not clear if it would apply to privately held FFELs, so while I wouldn't plan my life around it, it's something to consider.
This field is absolutely teeming with scamsters, even some with a respectable veneer. Some state AGs (MA, NY, IL) offer some form of advising, whether that be individualized or just detailed general information. I would start at your state AG's website. Often the information is under "consumer information/frauds." The NCLC's Student Loan Borrower Assistance Project may also be of assistance. I can't recommend any private for-profit assistance. Unfortunately, in the absence of fraud on the part of the school or total disability on your part, the basic mismatch of having borrowed more than you can afford to pay back is not something that can really be fixed on an individual level.
(Student loans are opaque even to people who've been working in the field for years. You shouldn't feel bad about struggling with them.)
posted by praemunire at 12:37 PM on March 9, 2021 [4 favorites]
But not irredeemably so! It is fairly straightforward and free to consolidate your FFELs into the Direct program. Direct loans have expanded income-driven repayment programs (FFEL has only one program, IBR) and eligibility for Public Service Loan Forgiveness. Most people will benefit from consolidating their FFELs into Direct loans. There are a few exceptions, though. If your FFELs are of a certain vintage, the interest rate may be quite low compared to that of Directs, so you should compare that. Also, if you are close to IBR forgiveness (if you were, you'd probably know), it might not be a good idea.
Once you consolidate, you should be able to take advantage of payment suspension, as well as seeing if you're eligible for a better income-driven repayment plan. Also...if any across-the-board forgiveness does take place, it's not clear if it would apply to privately held FFELs, so while I wouldn't plan my life around it, it's something to consider.
This field is absolutely teeming with scamsters, even some with a respectable veneer. Some state AGs (MA, NY, IL) offer some form of advising, whether that be individualized or just detailed general information. I would start at your state AG's website. Often the information is under "consumer information/frauds." The NCLC's Student Loan Borrower Assistance Project may also be of assistance. I can't recommend any private for-profit assistance. Unfortunately, in the absence of fraud on the part of the school or total disability on your part, the basic mismatch of having borrowed more than you can afford to pay back is not something that can really be fixed on an individual level.
(Student loans are opaque even to people who've been working in the field for years. You shouldn't feel bad about struggling with them.)
posted by praemunire at 12:37 PM on March 9, 2021 [4 favorites]
Oh, I just saw you're in IL! Their AG has a free Student Loan Helpline that can answer some of your questions.
posted by praemunire at 1:11 PM on March 9, 2021 [3 favorites]
posted by praemunire at 1:11 PM on March 9, 2021 [3 favorites]
Here’s a calculator that lets you put in numbers and specify various repayment scenarios. I have not used this one, but I used a similar one customized for med school loans. https://studentaid.gov/loan-simulator/
posted by 8603 at 4:41 AM on March 10, 2021 [1 favorite]
posted by 8603 at 4:41 AM on March 10, 2021 [1 favorite]
I've just been through this process of converting a FFEL loan to a Direct loan by consolidation. One interesting aspect is that, while Direct loans are still serviced by private companies such as Navient, you do get the opportunity to choose your servicer. Just something to keep in mind in case you're less than pleased with the service Navient has given you (and you wouldn't be alone in that).
posted by ContinuousWave at 9:47 AM on March 10, 2021 [3 favorites]
posted by ContinuousWave at 9:47 AM on March 10, 2021 [3 favorites]
To ContinuousWave's point, I have had no problem with Great Lakes or Fedloans.
posted by 8603 at 10:40 AM on March 10, 2021 [1 favorite]
posted by 8603 at 10:40 AM on March 10, 2021 [1 favorite]
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posted by augustimagination at 7:49 AM on March 9, 2021 [3 favorites]