Any Older Student Loan Borrowers?

Cancel Student Debt and win #CollegeForAll
#107

Hello, Where is the 50 / 50 slack?
Here’s my 2 cent story. I went back to grad school after the recession to what was supposed to be a growing field - Landscape Architecture (Florida) However, reality was far from their marketing materials. The mis represented the debt amount, there were few jobs, they hired younger and out of country students instead of my A+ resume, and I’m denied a license because they deny employment.

Landscape Architecture is fraud.

The licenser doesn’t even allow much “architecture” and the majority of the RLAs know next to nothing about plants.

Anyone want to join me in Florida about this topic?

#108

65 yo philosopher, working a blue collar job. I’m in IDR at $91/month. At that payment level, I’ll pay the loan off roughly speaking in 2234. Right: 210 years.

At Mr. Musk’s rate of pay, I could pay it off in about 12 minutes.

More fun: MOHELA recently reported my debt to TransUnion…twice. Same account #, same balance. Tanked my credit score a few months b4 I might have been able to buy a decent used car.

No matter which of the main POTUS candidates wins, I predict we’ll see the long knives come out to collect these debts. We’re all going to be a lot thinner soon.

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#109

I am 70. I owe just shy of $100k, borrowed $105K, paid back about $60k. Capitalization of interest got me (and cancers). On the 25 year payment plan.

I just managed to get it cancelled due to the physi. WHYcian letter disability route. This means after 3 years of monitoring it will be formally considered cancelled and the debt will be forgiven. HOWEVER then I will owe federal (and in my case state) taxes on ordinary income of a couple hundred shy of 100K. Why? Because Biden’s freeze on that ends the end of 2025 and mine will be considered cancelled in 2027. So I then will have about a $27000 debt to the IRS and the state. That year all of my social security will be taxable and then I will have IRS debt. If you don’t pay that on time you get charged interest and penalties for each payment.

ALSO BEWARE if your loan is cancelled because your 20 or 25 years is finally up you will be in the same fix with IRS debt. It’s considered income (exceptions are public service and teacher forgiveness).

AND BEWARE IF YOUR ARE 65+ and in default. Some of your social security will be taken as a payment to pay this debt along with any tax refund. If you are in default and younger and have any tax refunds coming they will take your refund too. It’s the law unfortunately.

If you can consolidate under the SAVE program (if you plan to pay) as the payment is 5% of your net income and all the other consolidation programs they take a higher percent of your income.

Welcome to retirement where you could easily be living below the poverty line like I am but then have a huge tax bill with no way to pay that debt. THIS NEEDS TO CHANGE. Our debt was cancelled due to permanent and total disability and now we owe more than we are living on for an entire year in IRS tax? (or in my case will be debt?). How the heck can we pay that?

#110

If this is an undergrad loan and you have been in repayment for 20 years, grad student for 25, your loans should have been cancelled. Originally they didn’t count deferment nor forbearance in those 25 years, during the pandemic they added to the count forbearance months and all months during the pandemic. Go to your repayment processor, log in or create an account, and ask for a history of your payments. You should see corrections in the count for forbearance and the pandemic pause. Or call them. If you change to the SAVE plan it will decrease your payment HOWEVER BE AWARE the amount then written off when you hit the 20 or 25 year mark of payments you that write off will create a new debt - IRS debt as it is considered ordinary income and you will have to pay taxes on it as if you actually got that money in spendable form. In 3 years I will have about $100K added to my “Income”. No idea how I will pay that IRS debt as it will be more than I make in a year. We need to change this.

#111

Is there an Over 50 forum? I joined too late for this zoom meeting.

#112

The conversation in the Debt Collective now happens in the Slack. This link can get you to the Slack: SLACK: https://join.slack.com/t/debtcampaign/shared_invite/zt-1iiiorus7-Q8RHTxnC3k5AV9CfSV06ig

#113

At 58 and after 25 years of making payments, I’ve ended up with 126K (more than double my original debt when I graduated with my master’s). I’ve made mistakes, and I had to file bankruptcy 12 years ago that colored my history, but the criminal banking tyrants have us all trapped by the ridiculous interest compounding.

Had I not had this debt, I would have gone on to get a Ph.D., but even when my debt was 52K, I knew I had to get to earning a debt-entangled living. I daydream of eliminating that debt since I have quickly paid off the original debt.

Thanks for being here and being vocal. It gives me hope I am not isolated and unaware. I hope to see a voting bloc of older debt-holders make an impression on the coming election cycles.

#114

Meant to add the pause on taxation of what is written off ends the end of 2025. Starting in 2026 it is taxable again.

#115

I am 61 years old and took my loan out for 16,000 and now I owe almost 200,000 for a very small loan. I had a very difficult time paying it back because I ended up homeless with a 6-month-old son and was living out the back of a U-Haul truck because the first truck was broken into and stolen with everything I owned. The only thing I had was the clothes on my back It was devastating and scary because I had no clue where my life was going to go at that point. I was with and abusive man and I couldn’t do much around him with a 6-month-old baby. We were barely getting by. Eating peanut butter and jelly sandwiches for
months until went to a church for help and they turned us away. But a custodian heard our story, and he took us all in until we could get back on our feet. It was tough. No jobs, no clothes, no money, no food etc… To make a long story short I have been working off and on and I finally got myself together. But paying that large amount of money back is pretty tough especially when you are only making 40,000 a year and you have living expense, and you loan payments are 2400 a month which I cannot pay. I barely make that in a month working. How does someone supposed to live like this. Having the burden of a federal loan over your head and afraid that your money will be taken away to pay it and you will eventually be back on the streets. It’s so scary.

#116

If these are federal loans get on the Save program as the percent of your income they take is the lowest out there. If you are in default look at the Fresh Start program. You can sign up for that through Sept. Starting in Oct the federal government will start garnishing wages and social security.

#117

Smartlady With federal loans you can sign up for the SAVE consolidation program and you won’t be paying anywhere near that amount. That is the program that takes the smallest percent of your income. Also if you find a job at a government or non-profit you can, while on the save payback program, count your 10 years of working for either and then the rest of what you owe will be written off and you won’t owe taxes on it.

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#118

The right wing conservatives filed suit tonight against the SAVE program. I think the approach where Biden cancels and asks questions later was/is the way to go. What do you think?

https://www.washingtonpost.com/education/2024/03/28/student-loan-lawsuit-save-repayment-plan/

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#119

The catch is the SAVE program and any other pay X years and the rest will be forgiven (also a problem with disability discharge except VA disability determination) is all forgiven debt is considered taxable income after the pause ends (end of 2025). As a result you are trading one kind of debt for you can’t rid of it in bankruptcy debt (eg IRS debt and in 10 states state tax debt) because you get a 1099-C. THIS NEEDS TO CHANGE. Below is why (this is a copy/paste from my comment on that WP article). As far as I can tell the Dept of Ed isn’t dealing with this with their Negotiated Rules for Student Debt Relief efforts (committee meetings finished the end of Feb, there will be 30 days of comments in the federal registry but I can’t find it to comment on it).

Copy/Paste:
One big catch never mentioned with canceled student debt (and that includes that which is canceled for disability (except VA determined disability)) is that prior to the covid caused pause and now after it when that bill expires, is that canceled student debt is considered ordinary income (starting in 2026 it will be considered ordinary income again). This means you pay IRS taxes on it. It is counted as income for living in HUD and your rent (if enough is forgiven you will be tossed out of HUD when your income is too high). It is considered income for SNAP eligibility, TANF, ACA health insurance premiums (but not medicaid eligibility), if on medicare your medicare B and D premiums…

This creates a huge financial catastrophe for many. As interest used to be capitalized until recently, often people owe far more than they borrowed if their income is low, if they have had unemployment or hardship forbearance, if they were early in the repayment process and most of their money goes to interest and not principle (that last problem has been resolved as of this year interest is no longer capitalized).

When the pause on this ends the end of 2025 students will have a huge tax debt that they can only get out of if insolvent however to be considered insolvent could be difficult as literally the clothes on your back are considered assets and if you have any money in retirement saved you will need to empty out your retirement savings to pay. 10 states also tax this money as ordinary income and in most of those states insolvency can’t solve that problem.

THIS NEEDS TO CHANGE! If you are disabled and can’t earn money how do you pay a huge tax debt? If you are low income and have been paying all these years how do you pay a huge tax debt? The IRS charges a monthly penalty and interest on a payment plan. If you can’t pay that much a month they garnish your wages and social security… This is a problem no one is talking about.

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#120

Hi! Graduate of San Diego State University in 1994. In 1995 the bill I got was around $13,000, now it’s over $92,000. When I first got the bill I was shocked, I had no idea what I had gotten myself into, just signed the “Financial Aid Package” and got down to my education. The debt has influenced my life greatly, from always working as a freelancer after the ‘Education Department’ started garnering my wages, to not getting officially married because who’d want to tie someone they love to your debt? The burden of the monster debt is palpable. Why would I ever try paying a debt so far removed from the original size? There’s been no one to turn to, to plead my case, over these thirty years. The companies that have handled my debt over the years love to just kick my debt down the road with more interest. Cancel all student debt now. Pretty please. https://www.youtube.com/watch?v=CAsqf5ofoVA Link is to a video I made telling my story with the documents to prove it.

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#121

Hi, Yes. I’m 50, a solo mom of a 9yo, and owe at least $130k. I’m an Adjunct professor so I don’t qualify for PSLF, and have been trying to figure out what options that I do have. I also made the decision to work minimally (one class per semester) during the pandemic to keep connected to my school and build my career, so I built up a lot of debt just trying to pay rent, food, cloths for my growing daughter. I now realize that I would have been a lot better off financially if I had just gotten unemployment and not tried to pay all of my rent and incur credit card debt.

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#122

This is a Big Question. It’s connected to the “American Rescue Plan Act of 2021” and whether it is renewed or whether other action is taken. You should keep updated as to its status. For the moment, any forgiven debt will NOT be counted as taxable income until the beginning of 2026. * “Whether Congress or the president through administrative action forgives student loans… if it’s between 2021 and 2025, it will not be taxable income for federal purposes,” Jared Walczak, vice president of Tax Foundation, told Axios. Also see Tax-Free Student Loan Forgiveness: What it Means for Borrowers with Large Balances - Student Loan Planner

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#123

How many here have applied for the student loan payment count adjustment? Seven Things to Know About the Student Loan Payment Count Adjustment - ED.gov Blog

It goes a long way to addressing those with loans whose capitalised high interest student loans –initially 20k+, now balooned beyond 200k. Even if one diligently has been making payments over the years, this happens.

Also, please remember to vote!

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#124

I am 43 years old and it has taken me 15 years to finally be eligible to apply for my LCSW exam to become a social worker. I was also a student with disabilities enrolled in disability services at CSULA. In the US, students receiving disability services who are enrolled in public universities may have their tuition paid for by the US dept of rehabilitation services (DOR). I did not find out about this program until my last year of graduate school once my tuition was already paid for through the student loan process. I am now in over $100,000 in debt. Upon enrollment students who are enrolled in disability services their tuition should automatically be reduced to $0. There is no tool for debt cancelation based on this issue, however I am sure there are millions of us that were entitled to this program and never made aware either purposefully or negligently by our universities in order to cash in on the in-debt-ness of disabled students.

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#125

I hear you. I’m 69, retired nurse, barely making ends meet. I’m working part time, and sometimes more just for unexpected expenses.
No pension, 401 just SS.
The only thing I can say if that if you’re on the income plan, if you work less, the payment will be less.
Although, depends on what you bring in also, otherwise.
My ss is only 1,800. I made 9,000 last year, my payments are 0. They’ll keep increasing until I die I guess.
I borrowed 75K. It’s now at 325K .

#126

Let me follow up here to say that today I received an email that said “Congratulations! The Biden-Harris Administration has forgiven your federal student loan(s) listed below with Nelnet in full.”

I am still re-reading this to see if I missed anything.

Oh, yes, this:

“Here are some important points on this IDR forgiveness:
Due to the American Rescue Plan Act of 2021 the balance of your loans that were forgiven is not considered taxable income for federal income tax purposes. Since state and local tax implications will vary, we recommend you contact a tax advisor for more information.”

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