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please read if considering IBR
December 4, 2017
4:18 am

I paid off my federal student loans after 29 years of consciously letting those loans define me as a loser in my mind, plus letting them fuel my anger against my father for him not helping me with paying them back like he promised he would do (he paid for my sister’s $240,000 loan in full), plus also taking low wage jobs so that I could stay on IBR and re-certify every year.

Here’s my story: I started my student loan nightmare 29 years ago, when I was 20 years old. I stupidly went to a private law school and also stupidly didn’t ask the loan “advisors” for any help or guidance (nor did they offer any). And by far my stupidest mistake? I believed the hype that I would be making 6 figures out of the gate after passing the CA Bar Exam (it didn’t happen. I did pass the bar, but never got a job paying more than $56,000).

I borrowed $65,000 and ended up paying $165,141. Let that sink in for a moment. How did the amount get so high? Well, I took advantage of every means to delay paying it back – forbearance, deferment, and then the worst idea ever: IBR. But I also defaulted at one point and the cost of curing that default was crazy high. By the time I rehabbed my loans, my principal was up to $95,000. I was approved for IBR when the program first became available, and I thought I was hot *fudge* *crap* *country music star* *female dog*: for some years, my monthly payments were $0! Even when I was making $56,000, my payments only went as high as $289/month, which = Negative Amortization in a HUGE way. My payments obviously failed to cover even the interest due, and my payoff balance shot up to $165,141.

And then my father passed away. I was to receive about $170,000 in life insurance proceeds. I thought I could call up my loan service company and make a deal with them—offer to pay them the principal balance of $95,000 right now,  if they would eat the interest. No dice. I had no idea that they would have zero incentive to make a deal… the representative told me that they would just as soon have me stay on IBR for the remaining 20 or so years that I had left on the program (provided I could continue to qualify).
I almost threw up once I realized the decision that I had to make—the first adult decision I had made regarding my student loans. I instructed the life insurance company to pay off the $165,141 as a payment without the money ever hitting my bank account. I paid off my student loan. You would think that I would feel an immediate sense of relief, wouldn’t you? Well, I have to say that a year and a half post payment, I am only now starting to feel relief. I had let the loan define me in so many horrible ways and I feared for my future and forever put off kids (I am 50 now) and let my depression break up my first marriage, that I am pretty used to feeling like an angry victim, even though I can breathe much easier now. The constant worry about the future of IBR and student loan forgiveness and how the IRS will look at that forgiveness in terms of taxes, has been ever constant in my mind, and in turn, has made it hard for me not to still obsess. But today I am making this pledge: I will STOP reading student loan horror stories and stop feeling scared and hopeless, but I will also try in every way I can to hopefully stop someone else to allow his/her life to be marginalized by student loan debt. Please learn from my pig-headed mistakes and face your loans early on. It will save you years and years of heartache (and interest)!

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