I borrowed ,000 in student loans 10 years ago – now I owe twice as much

I borrowed $50,000 in student loans 10 years ago – now I owe twice as much

I borrowed ,000 in student loans 10 years ago – now I owe twice as much

  • Lisa Sass, 31, took out $50,000 in private student loans to pay for college.
  • After 10 years, Sass owes almost twice as much as he borrowed and cannot pay the tuition.
  • She wants private student loans to be included in Biden’s student loan debt relief program.

This essay is based on a conversation with Lisa Sass, a 31-year-old senior account executive from the Greater Phoenix, Arizona area, about her student loan debt. It has been edited for length and clarity.

At 31, I never thought I’d be nearly $100,000 in debt — and that’s just for student loans. I dropped out of Northern Arizona University over a decade ago before I was able to officially graduate in 2013. Since then, my student loan debt has more than doubled.

I currently work full-time as a senior account executive at a brand marketing and public relations firm where I make $70,000 a year. Since I couldn’t afford the original monthly payment of $1,000, I pay $500 a month towards my loans. Paying half allows me to pay living expenses and other bills, but my student loan payments only cover the interest.

As a high school student, I didn’t understand the impact these loans would have on me and my family for the rest of my life.

I was the first person in my family to go to college, and despite receiving a small NAU scholarship, I still needed to find a way to pay for school, especially as an out-of-state student. So my parents and I took some classes to better understand Federal Student Aid Loans (FAFSA) in 2009.

We participated in two workshops that took place at night. We went to my high school library with about 15 other students and their families and went through the application process. It didn’t really impact me, especially when I was 17 and wanted to move out of my hometown. I didn’t really understand the implications or seriousness of the loans, but I think my parents found them informative.

Midway through college, I ended up losing my scholarship — I was put on probation — and I needed to find another way to pay the shortfall. In addition to federal loans (which are now paid off, thanks to my parents), I turned to private options.

I still didn’t know how loans worked, but I was desperate to reach my goal and make my family proud. I asked my father and grandfather to guarantee the loans, assuring them that I would work hard to find a high-paying job after graduation.

They reluctantly agreed and I took out my first private loan in August 2011 for $26,000 with a variable interest rate of 13%. The following year, I borrowed $27,500 at a fixed interest rate of 12% with my grandfather as guarantor.

After my fourth year at NAU, I accepted two unpaid summer internships and worked part-time as a restaurant waiter to save money

The two internships were the last 10 credits I needed to officially graduate. At the time, I was living in Hacienda Heights, a suburb of Los Angeles. I didn’t pay rent, living with my grandparents, but I drove to internships every day. My work was less than five miles from my home, but my internships were 25 or 30 miles away.

I would spend nearly $100 a week on gas and be stuck in traffic every day. Also, I was getting calls daily asking for my $1000 monthly payments. Just like today, no matter how much I paid, it wasn’t hurting my original loan.

When my internships came to an end, I got a full-time offer at a PR agency in LA, so I left NAU without officially graduating. I was eager to get a full-time job, but with a starting salary I couldn’t afford the minimum monthly payments, which at the time were $800.

Car payments along with other debts kept my wallet tight. In 2016, I received a student loan forbearance, which stopped payments but not interest. This helped for a few years, but my payments started again in 2018. This time it was $500 a month.

In April 2019, I ended up moving to Flagstaff, Arizona, hoping for a more affordable cost of living.

I freelanced remotely for an agency in LA and another in Phoenix while working as a server and driver for Postmates evenings and weekends. I was doing great and even enrolled in a summer semester at Mesa Community College in Phoenix since I needed 10 more elective units to officially graduate. I took three online courses in five weeks and finished with a 4.0 GPA, then transferred those credits to NAU. I received my diploma in the mail a few months later.

I paid out of pocket to go back to school, and it was significantly cheaper than my NAU tuition—just $85 per credit hour. This helped me to defer my loans for another year, but the interest continued to rise. With private loans, you can only defer your payments when you’re in school—specifically, if you’re going back to college, pursuing graduate school, or participating in an internship, secretarial, fellowship, or residency.

When my loans were delayed, I decided to just focus on my job and save money. As the cost of living in Arizona has increased dramatically – almost to California levels – during the COVID-19 pandemic, I’m back to where I was financially a few years ago.

I feel like there’s no end in sight

My minimum monthly loan payments are currently set at $980, but I can still only afford $500. I am currently “behind” about $2,600 in payments. I still owe $95,576 in loans, and it’s a shame that private loans were left out of President Joe Biden’s forgiveness program.

I go back and forth on this topic as I see both sides. I think loans need to be paid off, but I don’t think interest rates should be as high as they are. It’s the interest rates that are screwing everyone up.

I also don’t think school should cost that much. But despite what I think, I’m stuck in this situation.

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