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Student Loans

By Terry Savage on September 08, 2020 | College Savings / Student Loans

Hi Terry, I’m 59 and had to go back to school after my divorce in 2012. I did have student loans of $50000. But was unable to pay any because my income basically paid for housing, food, utilities, and insurance. My income now is $47000 a year and I am supporting myself. I have been contacted by a collection agent who now says I owe $72,000. I have recently been contacted by a company called “PAYE” who says they can do a program with forgiveness after 20 years, but the payments are nearly $300 a month. I’m confused as to what to do. I had consolidated my loans prior to my divorce being final and now feel like it was the worse thing I ever did. I have to have an additional $80 per paycheck withheld, just so that I don’t have to pay into the IRS annually. I need help! Should I work through this collection agency at the higher amount, or work through “PAYE” who I have never heard of? I’m barely staying a float now.

Terry Says

Immediately call the National Foundation for Credit Counseling at 800-388-2227. They are experts in dealing with this situation. You can trust them completely and do it over the phone.
Student loan balances are not typically erased by bankruptcy — and eventually they will impact your Social Security payments, but hang in there. The collection agency isn’t offering you any special deal. NFCC knows all the ins and outs of repayment. Please write back and tell me the advice you receive — and let me know the results.

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