The greatly exaggerated tales of forgiveness and more

Contrary to popular belief, student loan forgiveness is extremely rare.  First, these loans are not discharged in bankruptcy, the conditions to do so are close to impossible.

Secondly, while the Public Service Loan Forgiveness program was started ten years ago, it was only this month that the first people on it became eligible to apply for forgiveness.   And that is only to apply, there is no guarantee they will get have their loans forgiven.  The criteria are so limited that only a tiny percentage of the people who have these loans can even apply for forgiveness under this program.

The odds of completing ten years of qualifying payments on the Public Service Loan Forgiveness program are very small.  First you must obtain a public service job that is included in the program.  Then you must stay on an income based repayment plan for ten years.  These plans must be reapplied for annually.  If your income goes up, or your number of dependents goes down, you can be kicked off the program.  And there goes any chance of loan forgiveness.

Many people have already paid back what they borrowed, yet still owe thousands of dollars.  The way the interest is compounded on these loans makes the amount owed grow at an incredible pace.

It is these higher amounts that are usually quoted when the possible amounts to be forgiven are mentioned.  Some say “These people borrowed the money, they should pay it back.”  Many have already paid back what they borrowed and more, yet are expected to keep paying and paying for years.

The Department of Education said in a letter, a person’s age or whether they are “experiencing financial hardship” are not taken into account when deliberating loan forgiveness.  Common sense and conscience should dictate that if the individual is already a senior citizen, with no possibility of getting a better job, or a job at all, this should certainly be considered!

Also, currently if a student is under 24 years old and wants a federal student loan, at least one parent is required to cosign.  Then if the young person can’t pay, the lender can go after their parents.

There is no guarantee that a college degree will result in a better job.  But these days, unless the student can get a full scholarship, or has wealthy relatives, college will result in thousands of dollars of debt.  This can take decades to pay off, if it is even possible.  Some senior citizens are dying, still owing on student loans.  The system is overdue some real change.  People who can’t afford to pay, and whose situation is unlikely to change, need real loan forgiveness.  Many simply don’t have the money to ever pay off these mountains of debt.  They should not have to go to their graves with student loans still hanging over their heads.

Second student loan story

I received this some time ago and just now have time to share some of this senior’s story.  I’ll call this lady Louise, though that is not her name. Shortly after receiving her degree she became ill with a permanent condition, that while not life threatening, definitely affects her quality of life and ability to work.

Life has not been kind to her since then.  Not many years after graduating, she was widowed.  She has had more than one heart attack.  She has also been involved in an auto accident, which left her with lingering health issues.   Louise is now in her 70’s and because of her multiple health problems will never be returning to work. She is trying to get by with only Social Security coming in.  Louise is on an income based student loan repayment plan.  But even with the lower payments she is having trouble making ends meet.  Her family has no idea that she owes thousands of dollars in student loans, and she doesn’t want them to know.   She is under a lot of stress from her student loan debt and has no hope of ever paying it off.  She describes it as a never-ending nightmare.  If you are reading this and think you don’t know anybody affected by these loans, think again.  Louise’s family probably thinks the student loan system doesn’t affect anybody they care about.

This is just the kind of person who desperately needs loan forgiveness, which isn’t available to her.  People like Louise who have no way to pay off the debt should be able to get out from under it.  The laws need to change!




Student loans and marriage

I posted on Facebook that I would hesitate to get married because my spouse’s income would be assumed to be available to pay student loans.  Somebody commented that a spouse’s income goes to all kinds of bills.  So I explained.  When you get married, your credit card payments don’t go up.  Your rent or mortgage payment doesn’t go up, and neither does your car payment.  Student loans are the only type of loan where you are expected to reapply for your payment plan each year.  I hear this can vary, but it is up to the loan servicer how often you reapply.  With the type of payment plan I have, I have to send in an application form each year, along with a copy of my tax return.  One area on the student loan payment plan application is about your spouse and their income.  The spouse doesn’t have to be a co-signer on the loan, if you’re married, you must fill in the part about your spouse’s income.  This is then taken into account In figuring your payment and deciding whether or not you qualify for that plan.  An attorney told me that the lender can’t use your spouse’s income to figure the payment if you file taxes separately.  But there is no place on the payment plan application to check “married filing separately” and then to skip putting in your spouse’s income.  A young woman told me that after she got married, her student loan payment doubled!  She exclaimed, “I didn’t even know my husband when I went to school!”  But that doesn’t matter to the student loan lenders, whose only concern seems to be to get as much money out of people as they can.

I went to the Department of Education’s student loan payment estimator and filled in my income and loan amount.  I put down that I was single.  I then noticed the payment amounts that came up for the different plans.  I then filled in the same information, but put that I was married.  I put zero for my spouse’s income.  Some of the payment amounts nearly doubled.  This is not right.

I’ve suspected that student loans are a factor in so many young couples raising families without getting married.  I personally know of several families with unmarried parents raising kids.  Sure enough, I read in an article that a couple with children had not married because they couldn’t afford an increase in their student loan payments.  The pro-marriage groups should be all over this issue, lobbying so that only the person who actually took out the loans should have their income considered.  And yes, this affects seniors too.  They may not be raising kids.  But they should be able to get married without worrying that it will increase their student loan payments by hundreds of dollars a month.  Many seniors are barely getting by, and struggle to make these payments anyway.  To greatly increase the payment amounts could make a difference in being able to keep a roof over their heads or becoming homeless.  We don’t hear enough about the hardships student loans are causing for many people, especially for seniors.  We’re not going to be getting better jobs if we are strong enough to work at all.  I read recently online that one woman had written, that unless she won the lottery, she would never get out from under her student loans.  There needs to be real forgiveness for people who can’t afford to pay.

Not quite good bye

I posted earlier saying I was going to stop blogging, but have reconsidered.  I will keep blogging, just not as frequently as I started out doing.  I will blog when something comes up that I want to weigh in on.  I’ve spent many hours writing posts about why the system needs to change.  Little has improved, and it can get discouraging.  The blog hasn’t attracted the wide attention from readers that I was hoping for.  But perhaps readership will increase with time.  I’m a senior citizen with a full time job and a busy life.  I have to make choices about what to put my energy into.  So I won’t be blogging weekly or more often, as I was at first.  I encourage you to go back and read past posts.  You are welcome to share them, just please cite me as the source.

I will continue to advocate for change in the student loan laws.  If you want to keep up with what I’m doing, you can friend me on Facebook.  I’m on there under the name Keep Jessica Afloat.   And if what I’ve said has resonated with you, here are some things you can do.  Write or call your elected representatives.  Once helps, repeatedly is even better.  Write your newspaper.  And check out Student Loan Justice at  They are also on Facebook.  Thank you for reading.

News stories about “Student loan forgiveness”

Recently a variety of sources have run stories about how “student loan forgiveness” is going to cost so much more than previously thought.  They imply that student loans are being forgiven left and right.  Nothing could be farther from the truth.  With current laws, allowing paychecks and Social Security to be garnished without a court order, it isn’t easy to walk away from a student loan.  And bankruptcy isn’t an option.  Theoretically it could work rarely, but I’ve never heard of an actual case of someone getting a bankruptcy discharge of student loans since consumer protections were removed from these loans in 2005.

Some of the articles say things like “The payments are so low, they don’t cover the interest.”  This is partially true.  Many payment plans don’t cover the interest.  But that is not because the payments are so low, it’s because the interest charges are so high!  At one point my payment was set at $153 a month.  As a single parent,  I was dipping into savings each month to make that payment, plus pay rent and buy food.  But the interest was over  $300 a month!  So the debt kept growing, even though I was making payments.  Luckily my family was able to move in with a friend, and didn’t become homeless, which was a real possibility.  But not everyone has the option to share housing.

The powers that be seem to assume that no matter how old, or hard up financially someone is, they are still able to pay on their student loans.  Don’t be fooled by these articles hinting that people who have these nightmare loans are easily able to obtain loan forgiveness.  It’s just not true.  For example, the Public Service Loan Forgiveness program is often mentioned as a way to get out of student loan debt.  But the conditions that the payments must be made under are very limited.  You either have to be on an income based repayment plan while making ten years of qualifying payments, or be on the 10 year standard repayment plan.  When you’re on the 10 year plan, which has high payments, your loans would be paid off in 10 years.  You wouldn’t need forgiveness!  And the chances of staying on one of those income based plans a full ten years are small.  If your income goes up, you get married, a child leaves home, etc. you can be taken off the plan.  And there is no guarantee that the Public Service Loan Forgiveness Program will still be around long enough to make ten years of payments.  Here is a link and statement from the Department of Education website forgiveness page under Common Questions:

5.Can I be certain that the PSLF Program will exist by the time I have made my 120 qualifying payments?

“We cannot make any guarantees about the future availability of PSLF. The PSLF Program was created by Congress, and Congress could change or end the PSLF Program.”

So even if you manage to stay on an income based repayment plan for 10 years (Student Loan Justice estimates 85% of borrowers won’t be able to do so), there is no guarantee the plan will still be there when you have completed ten years of payments.  And there is no guarantee of forgiveness, you have to apply and see what they say.

So there is not lots of “student loan forgiveness” out there.  It does get forgiven after you die, assuming you don’t have a co-signer, who would still be stuck for the loan. Forgiveness upon death isn’t much comfort for those of us who need relief now, while we’re alive!  And it sure isn’t right to expect taxpayers to take on these huge interest payments.  My larger loan account was originally $29,000.  Assuming I make the standard payments for 25 years, which I can’t afford to do, I would pay over $70,000!  The writers of these articles seem to think that if I managed to get forgiveness (I’ve already paid thousands, putting my retirement well being at risk) that the taxpayers would need to pay back the huge amount of interest.  That isn’t right.  There needs to be real student loan forgiveness for those who can’t afford to pay.

First Senior Student Loan Story

The first story sent in by a reader has some similarities to my own.  I’ll call her Joyce,  not her real name.  Joyce is in her 50’s. Like me she had no trouble paying off her first degree, an associate’s, obtained in the 90’s.  Then in the early 2000’s, she went back to school.  The field she chose seemed to be a practical one for finding a job in the future.  Joyce said lots of extra money was offered on top of what was needed for the actual cost of school.  She described it as not easy to refuse or give back.  She discussed it with her husband who agreed they could use the extra for health insurance (not offered by his job) and basic living expenses.  After obtaining a bachelor’s degree, she decided to go back for a master’s.

Joyce found a part-time job teaching in her career area, but the job didn’t pay very much.  Her student loans became due six months after graduation.  She was mortified to find the total of her student loan payments was nearly as high as their mortgage payment!  Joyce reports she spend a weekend crying her eyes out and wondering what to do.  Then a possible solution came to mind.  Lots of foreclosures were happening.  She decided to withdraw her retirement savings and buy some houses to rent out, using the income to make the student loan payments.  Her husband liked the idea and also put in some money, less than a third of what Joyce contributed.

Sounds like it worked for a brief time.  She was able to make her payments.  Then she found out her husband was having an affair.  The marriage fell apart.  They fought over the rentals, and spent thousands on attorneys’ fees.  Joyce tried to get her husband to split paying back the extra amount borrowed that had gone to health insurance and other living costs.  The judge turned it down since she’d received the degree.  She looked into the repayment plans, and said she realized quickly that they were scams.  The payments would never touch the principal, only go toward interest.

She lost her retirement savings, and most of the rental properties.  Joyce had found another, full time job, but still wasn’t making enough to make a dent in the student loans.  She’d borrowed about $75,000 for the two degrees and paid back about $3,000 before her marriage ended.  As if her situation wasn’t bad enough,  Joyce found that a loan from the 90’s had been handwritten into a consolidation loan requested much later.  She estimates she now owes over $90,000 and doesn’t feel too hopeful about the future.

Over 50 and want to tell your student loan story?  You can send it to me at or by U.S. mail at Jessica Hopkins, PO Box 2745, Salem OR 97308.

Student Loan Forgiveness – Not Much

Frequently you’ll see articles with “Student Loan Forgiveness” in the title.  I believe the student loan power players keep putting out this information in the hope that most people will not realize how terrible the system really is.  They want to lull the public into thinking “Things can’t be that bad.  Look at all the student loan forgiveness out there.”

Nearly always, these pieces are promoting a very limited type of forgiveness that has been available for years.  Let’s look at some circumstances under which loans may be forgiven.  These are from the Department of Education website,  Check it out if you want more details.  Here are some situations where student loans may be forgiven:

  1. Death  (this is the only one that always works, at least for the person who died.  Not for any cosigners.)
  2. Becoming totally and permanently disabled to the point where you can’t work.  (Even this one has many qualifications)
  3. If the school falsely certified the loan (only under very specific circumstances)
  4. If the school closed before you graduated (only under very specific circumstances)
  5. If the loans was falsely signed for, due to identity theft

There is a program called Public Service Loan Forgiveness, which sounds good, at first.  But after reading further, here is how it works.  The person must be working in specific types of jobs, the full ten years.  They must make ten years of full payments, only on certain types of loans, and only on certain payment plans.  Then they can apply for loan forgiveness.  This may or may not be approved.  The Department of Education has also come out and said that they make no guarantee that the program will still be in existence after the borrower completes ten years of payments!  Not much hope of relief there.

There is more, but you get the idea.  Having the loans discharged when you die is certainly no help to the people who need relief while they are alive.  The other conditions only pertain to a very small percentage of these loans.  The website specifically says: “Note that a Department loan cannot be canceled because a borrower is experiencing financial hardship and can’t afford his or her loan payments.”  Apparently in the Department of Education’s world, financial hardship is always temporary.  If only it were true.  And “experiencing financial hardship” sounds so much milder than “struggling to keep a roof over their heads.”  Which is exactly the situation that many with these loans find themselves in.  Especially seniors.

There is no meaningful help for seniors who can’t afford to pay their loans, yet are forced to pay anyway.  This is wrong.

Things need to change

I’ve been searching the Internet for articles on seniors and student loans.  There are a lot of stories of hardship out there.  What is so frustrating is that these news items have been running for years.  Yet there has  been no meaningful change in the laws that are ruining lives.  So many seniors whose loans have increased by tens of thousands of dollars because of interest and penalties…  There are people who have paid back what they borrowed, and interest on top of that.  Yet they still owe as much as the original debt, or more.  This is not right.  People should not be struggling to keep food on the table because they went back to college years ago.  I recently spoke with a woman whose father had just died in his 90’s.  At the time of his death, he was making payments on his daughter’s student loan, which he had co-signed.  He’d been paying on it for years, and apparently, could afford to do so.  When he died, the servicer immediately demanded payment in full from the daughter!  She didn’t have it.  Fortunately the total owed was less than $3000 by then.  A relative was able to loan her the money to pay off the debt.  But what about the many older Americans who can’t afford to pay and don’t have a relative who is willing and able to help?  They have no way out of a desperate situation.

I’ve called my representatives repeatedly pleading for some relief from these terrible loans.  They’ve told me “It’s the law.” They say it as if that should be the end of it.  Sadly, some people probably take that statement as the final word and hang up.  The members of Congress and the Senate passed those laws.  The ones that don’t provide real relief, even if the senior is forced into poverty by the student loan payments.  Congress and the Senate could change the laws to help people who are suffering, but so far, they haven’t.  It’s highly unlikely that seniors who are struggling financially are suddenly going to get a high paying job or experience some other big increase in their income.  There needs to be loan forgiveness for seniors who can’t afford to pay.  Real change in the laws is overdue.

Impossible situation

Some people seem to wonder why people who have these loans don’t just shut up and pay them already?  For thousands, if not millions of seniors, it is because paying them is impossible.  The government keeps bringing out new payment plans and claiming this solves everything.  It doesn’t.  Many can’t afford the payments, and have no way of increasing their income to do so.  Even for those who can make the payments, those payments frequently don’t even cover the interest.  Imagine how discouraging it is to pay thousands of dollars a year, only to see the debt keep growing!

This results in some seniors suffering severe stress, sleepless nights, and stress-related health conditions.  These can and do lead to premature death.

Businesses are being impacted as seniors spend more than they can afford on student loans.  Money that would have otherwise gone to consumer goods or basic living expenses is being sucked up by these loans.  See my related blog post, dated February 29, 2016.

One terrible aspect of the current laws is that when consumer protections were removed from student loans in 2005, it was made retroactive.  So people who borrowed money in the 70’s and were unable to pay it back, suddenly find themselves owing many times the original debt.  Before 2005, student loans were covered under states’ statute of limitations laws.  Loans taken out in the 1970’s had long since been cancelled under the statute of limitations.  Yet with the current draconian laws, these ancient debts were resurrected and vigorously pursued.  This is wrong.  Debts that were covered by statute of limitations laws when they were taken out, should not be subject to collection decades later.

If a senior who has these loans gets married, the spouse’s income will be counted on a income based payment plan.  Relationships suffer.  Some seniors don’t marry, knowing that their budget can’t take the pressure of even higher payments.  It is sad that they are denied being able to marry the person they love.  Others marry, not knowing how bad the laws are, and get a shock when their loan payment suddenly increases.

Student loans are a constant shadow over the lives of people who should be living out their final years in peace and tranquility.  The laws need to be changed.  The lender/loan servicer and/or harsh laws should not be the authority deciding what a senior can afford to pay.  They will squeeze the last cent possible out of the senior citizen, with no regard to quality of life.  There needs to be realistic consideration of what the person can afford to pay and still have a decent standard of living.  This is not even close to the current state of affairs.