Student Loan Debt Assistance

<p>I am trying to help a young man who is a friend of the family, who has no family support. He is working 3/4 time as a teacher in CA and his student loan payments are overwhelming and more than he can afford to pay. He has some Fed Loans but the problem loans are the private student loans, with banks, who will not negotiate with him. He cannot cover rent, food, gas, etc and the loan payments. I sent him to Consumer Credit Counseling looking for debt consolidation and they won't touch student loans. Anyone have any knowledge/experience with this? I'm trying to figure out where to send him next.</p>

<p>since they are private loans, I believe he can declare bankruptcy and walk away from them. Not an appealing option, but since he is young it wont hurt his credit history for too long.</p>

<p>I worked week-end nights at an up scale restaurant for two years in addition to a full time job to pay off my loans. A teacher working 3/4 time could find part time work.</p>

<p>If he currently lives alone, he can make a meaningful change in monthly budget by moving in with roommates. The monthly difference might equal what he can't summon up today to satisfy his loan payments.</p>

<p>Contact the federal student loan agencies to see if it can be capped. Sometimes they'll evaluate and if the monthly loan payments are more than a certain percentage of his monthly income, they'll give him a break for poverty. They don't cancel it; they defer repayment until income improves.</p>

<p>See if he's eligible for food stamps, although with a 3/4 teachers' salary, I'm guessing not. A single person/head-of-household in CA is eligible for food stamps when monthly gross income is below $1180.</p>

<p>Go to the principal or guidance counselor in his school and ask how to become known to parents as a private tutor for afterschool, either in the building or in individual students' homes. If he's in a high school, they sometimes have school-based positions as coach or club director that offer some extra money for teachers. Elsewhere in the district there might be some afterschool working in remedial teaching, even at another grade level or school building than his main-time teaching day. It's a lot better to pick up more work elsewhere in his district than to chase off to work on another employer's schedule (restaurants and such). If that's impossible, then a Saturday night or Sunday daytime job at a restaurant is compatible with a teacher's work schedule. </p>

<p>It sounds like he needs to fill in that last 25% of work that his district isn't giving him for work and salary. He needs to hustle up more work, basically.</p>

<p>menloparkmom...Seriously? Encouraging anyone, especially a young man out of college, trying to make his own way, to file bankruptcy is COMPLETELY irresponsible and an example of what is wrong with so many facing financial problems today. I agree with the others that say, find more work and to cover the debt. Do not encourage him to make his debt someone elses, please.</p>

<p>Scince he is working as a teacher 3/4 of the time... Can he do some private tutoring? SAT or other test prep to supplement his income? Find a part-time weekend job?</p>

<p>Time for a second job. </p>

<p>What about getting a roommate and splitting the rent and expenses? What about getting a second job during the evenings and weekends? What about working full time during the summers to help supplement the rest of the year's expenses? What about getting rid of cable and eliminating his land line telephone? </p>

<p>When he signed the loan papers, he knew that the day would come for him to pay back the money.</p>

<p>It really isn't news that teachers have second jobs on the weekends and/or in the evenings. When I was a kid, my dad and all of his school teacher colleagues held down some kind of second job (in some cases third jobs as well). Common choices were home improvement construction, encyclopedia sales person, and military reserve officer. Teachers in my local school district often tutor students from other schools in the district, and some work retail on the weekends. One has a thriving business setting up those street-side signs that advertise apartment complexes - he sets them out on Friday night or Saturday Morning, and collects them late on Sunday evening. A teacher's aide I know, doubles as an after-school care supervisor at her elementary school.</p>

<p>Yes, it's hard to get a second job in this economy, but surely some place is hiring for seasonal help. That would almost be guaranteed to be evening and/or weekend work. If he doesn't need to reserve every spare minute out of class for writing lesson plans (which could be true if this is his first year in the classroom), then a season retail job might be a place to start.</p>

<p>Wishing him all the best!</p>

<p>Is he paying on his federal loans? He may be able to put them into forbearance as long as he's current (or can rehabilitate them) and direct more of his income toward the private loans. Has he consulted an attorney yet? It seems to be very difficult to discharge private loans through bankruptcy since the laws were changed but he may be able to do a Chapter 13 reorganization which would basically require the lenders to accept the payment plan set forth. </p>

<p>Meanwhile, I agree with the suggestions to take on an additional part-time job and to be extremely frugal until things improve. I was speaking to someone the other day about holiday jobs for young people, particularly how it's difficult to work for minimum wage at the busiest and most stressful time of the year, and he told me that he used to advertise a "home visit from Santa" business. He noticed that people were spending a lot of time (and money) for those photo with Santa and figured people might be willing to pay for Santa to come to them. Rented a good suit for the season and stayed very busy from Tgiving to Christmas...he charged $35 for a 15 minute home visit and tripled his rate for Christmas Eve visits. Just throwing that out there as an example of how one can generate income even in a bad economy...</p>