Paying Off Debt_2 - Students Coping With The Crisis
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Paying off debt_2 of the students is quite an undertaking these days, what with the present grim job picture or the lack thereof. I have been trying to look around for alternatives specially from the Obama Stimulus Plan if it is covered there. Oh please, say it is so!
What I have been hoping is to find some help for the paying off debt_2 scenario. At least there should be some kind of abatement or forgiveness. To make it partly or wholly dischargeable in bankruptcy will be welcome news although this will be a last resort. Here are some of the things I found that will ease the paying off debt_2 somehow:
You can have the student loan deferred. This is really not easy to swallow as it will increase the debt. And the interest will continue to add up as before. This is not advisable because the payment will go up after the period of deferment is over. The only thing that this is good for is that it will give you some break on making payment now.
The next option is IBR or Income-Based Repayment. As the name implies, the payment is based on income and the size of the family. The payment cap is set at less than 10% of the total income. It is even lower for those on the lower income bracket. And after twenty five years of payment, IBR could forgive the loan. That is only one more over a payment period of two years. This may give you more information: http://www.finaid.org/calculators/ibr.phtml (if by chance, they changed the site, try to copy and paste that address onto your browser.)
Joining Peace Corps or Americorps may altogether wipe out your debt. This may be a desperate option to take but not really. You'll get to travel and meet some wonderful and some not so wonderful people. And you will be able to help those who are less fortunate than you.
Some federal programs will forgive part of the student loan in exchange for hours of community service. This may provide some valuable information: http://www.finaid.org/beyond/volunteering.phtml (click that or just copy and paste that address onto your browser.)
Teaching in some areas or becoming a civilian worker for the government could make your student loan totally forgiven. This may give you more information: http://www.finaid.org/educators/2008-03-10studentloancreditcrisis.pdf (click that or just copy and paste that address onto your browser.)
There is an Act enacted in 2007 that established a program that forgives loan after working ten years in the public service. The requirement to qualify for this benefit is for the borrower to have made 120 payments starting October 1, 2007 or after. This website may give you more information. http://www.finaid.org/loans/publicservice.phtml (click that or just copy and paste that address onto your browser.)
I have heard of some who went to Iraq and Afghanistan on civilian assignments (but please don't go) had their student debt totally paid off.
I hope this has eased your mind somewhat on paying off debt_2, that is, your student loan. One question I have been asked is whether to pay the minimum suggested amount or pay a little higher. There is no one answer to this question. But if I were the one, I'd pay it off as soon as I can.
What I would do is pick up a date when I want to be debt-free. Then fill in the blanks at http://cgi.money.cnn.com/tools/debtplanner/debtplanner.jsp (click that or just copy and paste that address onto your browser.) Then you can input your debt and how long you want to be debt free and you'll see how much monthly payment you'll have to make so you can finish paying off debt_2.
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