You know the term.....

[Frodo]

Worth more dead than alive? I was just adding up the total debt between my wife and I. It's quite staggering. It's somewhere around $566,000. Of that amount, $165,000 is in student loan debt that we, in all reality, will never be able to pay back.

Too bad I don't have a rich uncle.

[BassBoy]

I have moved this thread from the General Talk as the General Talk Section is non-related to BK.

So Frodo, what are looking at? Do you need BK? Which Chapter? What I can tell you now is that your student loans may not be dischargeable.

We will need more information if you need our help. If your comfortable with providing information such as what is owed on all your debts (i.e. house, cars, and unsecured debt's) and/or your incomes. Addtionally, are you behind with any payments? This may help us understand your situation a littel better and make some suggestions.

[Frodo]

Hello BassBoy.

Unfortunately, I am well aware that the student loans will be with us until the day we die.

I can say without hesitation that my wife and I have ruined our entire lives with student loans. There isn't a day I will be breathing that I won't be reminded that I will struggle to pay them off. I can see us in our 60's still making student loan payments. I realize it's our bed and we shall lie in it, but it sure does suck the life out of you thinking about it.

Are all student loans lumped into the same "untouchable" category for bankruptcy? We have a private student loan that's not federal, which makes me wonder if it too holds the same exemptions from bankruptcy filings.

I am pretty sure we want to file bk bute I have not taken the next step to even speak to a bk lawyer.

I have gathered that if I were to file it would probably be a CH13 and not a CH7 solely based on income level.

Here is a quick summary.

- Not behind on any payments.

- Combined income ($103,000 annually)
$6,100 take home per month

- Debt
[payment][balance][description]
$1,675 - $229,000 - 1st mortgage (fixed)
$868 - $99,000 - 2nd mortgage (fixed)
$360 - $11,000 - car payment (fixed)
$0 - $0 - 2nd car
$250 - $12,500 - AMEX Blue CC
$60 - $5000 - Rooms 2 Go
$450 - $13,000 - MBNA CC
$250 - $10,100 - BofA CC
$160 - $7,800 - Chase CC
$300 - $33,000 - SallieMae Private Consolidated Student Loan
$700 - $91,000 - SallieMae Federal Loan (in forbearance)
$400 - $48,000 - Nelnet Federal Loan (in forbearance)

[wrinkleigh]

With that much Student Loan debt -- I am assuming you have a degree.
Depending on what field it is in , some employers will work with you and pay your debt for you. There may even be some goverment programs that could cancel some of it out, again, depening on what field you work in. Maybe you could shop the job market and see if this is included in any of the benefits packages.

I work in the educational field, and I HATE to see students borrowing so much money. I have seen students graduate with a BA in Education owing $100,000.00. I always think to myself how in the hell are they going to pay that back on what a teacher makes?????? I feel your pain, I see it everday.

One more thing -- keep in mind with a forebearance -- interest still accrues on the loan. Try a hardship deferment, with a deferment -- no interest accrues.

Also, keep in mind that one of the issues Congress is taking up this term is lowering interest rates on student loans. The first place you will see lower, is the US Department of Ed, which offers consolidations through the Direct Loan program. So keep you eye on it and shop the rates arounf if and when it is passes in the next few months.

Good luck to you!

[lrprn]

Wrinkleigh gave you some great suggestions. Also there's a good overview of what's possible to do with student loans during bankruptcy here - http://www.finaid.org/questions/bankruptcy.phtml - scroll down to the Discharge Student Loans through Bankruptcy section . There's also a good review of what you can do when you can't pay your student loans here - http://www.nolo.com/article.cfm/pg/1...3/208/135/ART/ .

Also about your private loan - thanks to the wisdom of Congress in 2005 when they passed the new bankruptcy law, private student loans are now pretty much as hard to get rid of as government student loans. Sorry.

I think it's awful that the student loan lenders don't make it crystal clear just how much debt you are piling up and how long it's going to take you to pay it back. A lot more students would be taking time off to work every semester or two to build up some capital to throw at their tuition. It's horrible to find yourself caught in this trap after the fact .

Hang in there, Frodo. Know that we are here any time you have more bk questions and also for venting on the bad days.

[Frodo]

My wife teaches at a private school, where our children attend. Her salary is about half what it would be teaching at a public school. Even then, salaries for teachers is still a joke. I don't see her income potential increasing that much over time either.

If she were to hand over her entire monthly check to student loan payments, it would take 9 full years to pay it off in full. Since there is no way on Earth we can put her whole check towards her student loans, I calculate it will take 36 years or something starting today.

By then, she will be about 70 years old. Like I said, we have ruined our lives with financial aid.

[BK&Filer]

The student loans do seem like a huge problem that you have to deal with but - The bigger question to me in looking at your details though is what led to the accumulation of about 50k in cc/unsecured debt, and a rather large mortage? You obviously have a rather good income between the both of you - but it loooks like the student loans, combined with the other debt you have taken on, is sinking you. I know this sounds judgemental, but what jumps out at me is that you just may be trying to leave above your current means. That is a staggering amount of student loans though.

[Frodo]

Thanks for the links lrprn.

The upside is that it's alteast minutely possible to discharge student loans through bankruptcy.

The downside is that my wife and I either need to become permanently disabled or die to do that.

[SinkingFast]

I think it's awful that the student loan lenders don't make it crystal clear just how much debt you are piling up and how long it's going to take you to pay it back. A lot more students would be taking time off to work every semester or two to build up some capital to throw at their tuition. It's horrible to find yourself caught in this trap after the fact .

Hang in there, Frodo. Know that we are here any time you have more bk questions and also for venting on the bad days.

Actually, we've done the Stafford Loan process. First for Son for this entire '06-'07 school year. Then for daugher for Spring '07 as she was a midterm High School graduate.

Stafford Loans here do require a pre approval Credit Counseling Session now. There's a series of questions that students HAVE to answer. Depending on the school, you have to have a perfect score or can only miss an allotted number. 1 or 2 at most. The Community College our kids are attending requires a perfect score on the "Test" to get loan approval.

They want the kids to know the difference between Subsidized and Unsubsidized. That interest accrues on Unsubsidized while they are in school. That they can pay the interest that's accruing while they are in school. That Federally backed Student Loans cannot be discharged in BK. Lots of stuff.

So there's an attempt, here at least, to make sure the kids are informed borrowers when they take on Stafford Loans.

[wrinkleigh]

Frodo --

What subject does she teach? I know there are "special" programs for Math, Science, Special Ed, and Counselors. I will TRY and find some more info, and post some "professional" links in a bit.

On a side note -- I truly hope I didnt offend you -- about the teacher salary and payback -- it was just the first thing that came to my mind as an example. I truly didnt mean to offend.

[SinkingFast]

On a side note -- I truly hope I didnt offend you -- about the teacher salary and payback -- it was just the first thing that came to my mind as an example. I truly didnt mean to offend.

I know what you mean, Wrink.

We have a daughter in the Early College Program of her High School. When she graduates High School in May she'll also have 30 credit hours and be a sophomore in college.

But alas, DD does not know what she wants to do. She's always loved to read and write so she's leaning toward an English major. But then she says, "If I don't write for a newspaper or magazine, and I don't want to teach, what is there to do?? Where can I work and make a decent living??"

[lrprn]

So there's an attempt, here at least, to make sure the kids are informed borrowers when they take on Stafford Loans.

This is really good to hear, SF! At least this can help future Stafford borrowers to not get so terribly overextended.

[SinkingFast]

Not to mention the fact that you cannot borrow a minor fortune with the Stafford Loan program. It's only $10K to $15K tops if you use it all 4 years. Something like $2500, or less, as a Freshman, less than 30 hours of Credit. I think by your Senior year, you can get close to $4K for a year.

Stafford offers enough assistance to pay for Community College tuition here. Son has to pay for books out of pocket. He got his Freshman year debt free but nearly killed himself in the process. He had to borrow this year.

Because we filed BK, Stafford is about the only loan our kids can get. (( The only one we know about and we don't wanna know about others. )) We can't co-sign for them or take Parents Plus due to our lack of "credit worthiness". But we see that as a positive for the kids. They won't be butt high in debt when they leave college.

[brainless twit]

Frodo - Don't quote me on this, but I believe if you have paid on your federal student loans for 20 years and still haven't paid them off, you are eligible to have the rest forgiven. I know that probably isn't much consolation, but you might want to look into it. If I can find where I read that, I'll post a link.

[Frodo]

I had heard that also about 20 years, but we aren't currently paying the federal student loans. Assuming that is true, the 20 year clock won't start until we start actually paying them.