Loans

sid
Posts: 1392
Joined: Sat Dec 02, 2006 11:44 am

Re: Loans

Post by sid »

There is a huge difference between a specific unethical school which systematically lied to applicants about its stats for employment and potential income, and some random guy who just doesn't want to pay back loans.
There are some lawsuits working their way through the system to tackle the first problem. Generally about law schools and trade schools. So far the schools are winning, but I have sympathy for the defrauded students.

But if you went to education school, it's pretty hard to believe that you expected an abundant salary and tons of job offers. And if you washed out of your other profession, that doesn't mean you were defrauded.
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

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Post by PsyGuy »

@mamava

Theres no need to stay out of the US forever, you can stop paying on your loans while out of the country and then when you return X years later resume paying on them when your actually earning forgiveness. Even then its not exile, you can still come back to the states, on holiday, etc..
Student loans can be discharged in bankruptcy, its a myth that they cant.
In the worst scenario, even if your wages are garnished the limit is 10%-15% (sometimes 20%) of net income minus minimum wage, regardless of how long you havent made payments.

@sid

Very few DTs go to a "normal" college, specifically for education, a large majority of secondary DTs do a second major or 5th year late in their degree program when they realize that they need to monetize their education someway.

Its not a few colleges/universities its a wide spread misrepresentation of the value of a college degree in the vast number of majors to very young people who have grown up to believe that they need a degree to be successful.
sid
Posts: 1392
Joined: Sat Dec 02, 2006 11:44 am

Re: Loans

Post by sid »

You say the funniest things.
It's like trying to argue with jello. Hardly worth my time.
Reminds me of a Monty Python skit. https://m.youtube.com/watch?v=kQFKtI6gn9Y
Britgirl
Posts: 4
Joined: Fri May 29, 2015 6:26 am

Re: Loans

Post by Britgirl »

From what I understand Psy didn't say anything about defaulting. If you have the income-based repayment plan, you fill out an annual form. The form asks about your "taxable" income. Income earned abroad isn't "taxable" and therefore counts as zero. You don't have any income, they don't calculate a monthly amount. You pay what you can, or are willing to, or not. But, as long as your paperwork is current you are not in default, and the clock toward the 25 years of forgiveness is ticking. The main problem at the moment with that sort of plan is that that interest accrues, and any forgiven money is taxed at the end. But, then, who knows what will happen in the future.

-Brit
coughingfurballs
Posts: 24
Joined: Sun Mar 08, 2015 3:41 am

Re: Loans

Post by coughingfurballs »

No, PsyGuy, my advice is not based on "scary campfire stories". I have a family member who works in financial planning, and he has worked with multiple people who, like you, thought that they could really walk away from loans, or didn't understand what it meant to default, or that default would happen whether they ignored the loans or not. I also know someone who works for American Student Assistance, and they have a lot to say about the stupidity of people who try to run away from loans: it will mess up your life.

There are a lot of ITs who are going to have a nasty surprise when their student loan situation catches up to them. I still think this is a good topic for the blog, moderators. It might also benefit people who have run away from their loans, but not yet defaulted, to learn how they can fix things, or people who HAVE defaulted who might be too scared to try to face and repair the situation (to the extent to which it is possible).
koda
Posts: 66
Joined: Thu Nov 25, 2010 10:31 pm

Re: Loans

Post by koda »

Wilcoman-
Just a note, the IBR uses your tax return to decide on your monthly payment for that year. Living overseas, your income is tax-free in most places, making your taxable gross income 0, thus making your payments considerably lower for those next 7 years. ....Just something to think about.

wilcoman wrote:
> Psyguy is correct. I've paid for 3 years and still have 7 to go to have it
> forgiven. May just defer payments if I end up overseas and then when I get
> back will finish the 6 or 7 ....
>
> I don't know for certain, but according to some of the packages I have read
> about here and cost of living, I would make more money overseas. I work in
> North Carolina(one of the lowest paying states) and live in the most
> expensive city in North Carolina. So, financially it seems on the surface
> to be better. However, it's difficult to factor in the amount that I'd be
> putting into retirement working in the states and wouldn't be able to have
> a retirement fund overseas unless I end up in Europe. That's unlikely.
>
> Anyway, thanks for taking the time to comment. I have some thinking to do
> about future plans. May try the Search Boston/Cambridge next year and see
> what happens.
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

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Post by PsyGuy »

@britgirl

I really was talking about outright defaulting. Its not the hard decision you really have to make now, you can effectively and easily have an IBR of $0 and not have a lot of risks. My lender uses an online application.

@coughingfurballs

Yeah scary camp fire stories, the data simply doesnt support your stories of woe and despair.

Yeah American Student Assistance has a lot to say because they make their coin off of getting people to pay.
Overhere
Posts: 497
Joined: Wed Dec 05, 2007 3:29 am

Re: Loans

Post by Overhere »

If you're going to borrow money with no intention of repaying your loan why not save yourself the paperwork hassle and simply rob a bank or a 7-11?
Jay_Jay

Re:Vanguard

Post by Jay_Jay »

Would the tax man be able to touch your Vanguard account if you were on an Income-Based Repayment plan?
wntriscoming
Posts: 114
Joined: Mon Oct 01, 2012 3:44 am

Re: Loans

Post by wntriscoming »

One reason we moved overseas is to pay off our student loans more quickly. We had over $80,000 in loans. We paid them off in less than 4 years, as opposed to the 30-year loan we signed for. Even while paying our school loans off in large sums each month, we always had plenty left over for great vacations, 20% to retirement, and a comfortable life both overseas and summers at home.

Go ahead and head overseas now, not when things are paid off. You'll find yourself able to pay off your loans much more quickly, save more for retirement, and start your IT career. Good luck!
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

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Post by PsyGuy »

@Jay_Jay

No not if your in repayment. To do so they would have to file suite, and they arent going to do that if your not in default.
Greer41
Posts: 2
Joined: Tue Feb 18, 2014 3:34 am

Re: Loans

Post by Greer41 »

PsyGuy -
I know firsthand that student loans CANNOT be discharged via bankruptcy. Running from CC debt is one thing (stop paying CC bills and after 7-8 years its a non issue), but student loan debt is a whole other animal and something one shouldn't mess with.
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

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Post by PsyGuy »

@Greer41

I know that student loans absolutely can be discharged in bankruptcy. Having dodged my student loans for over a decade in IE, there were no negative consequences.
Walter
Posts: 325
Joined: Tue Feb 07, 2012 10:39 am
Location: UK
Contact:

Re: Loans

Post by Walter »

Oh David, David, the expression "Man of Honor" might have been invented for you:
Take out a loan - why should I pay it back?
Have a criminal record? Lie about it.
Dodgy college record? Invent a few qualifications.
Not too sure what your referees will say about you? Create a few imaginary ones.
Got fired from your last job? Take it off your resume.
To continue Sid's Monty Python reference, You're not the Messiah, Dave, you're a very naughty boy!

By the way, what you wrote about the value of a college degree is drivel:

"Its not a few colleges/universities its a wide spread misrepresentation of the value of a college degree in the vast number of majors to very young people who have grown up to believe that they need a degree to be successful."

In the UK, a female graduate can expect to earn three times more than another female without a degree; a male graduate will earn double what a male without a degree will earn. In the US, of the 2.9 million "real" jobs (that excludes Saturday jobs flipping burgers or pumping gas) that have have been created since the 2008 recession, 2.8 million went to people with degrees. A huge unemployable underclass is growing up, and they are the ones being cheated by society.
shadowjack
Posts: 2138
Joined: Sat Oct 06, 2012 9:49 am

Re: Loans

Post by shadowjack »

@PG

They changed the law on that one about ten years ago. No more discharge of student loans.
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