I took out ,000 in student loans 10 years ago, now I owe twice as much

I took out $50,000 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 double what she borrowed and is unable to pay the monthly payments.
  • She wants private student loans to be included in Biden’s student loan debt relief program.

This essay as stated is based on a conversation with Lisa Sass, a 31-year-old senior account executive from the Phoenix metropolitan area in Arizona, 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 from student loans. I left 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, earning $70,000 a year. Since I couldn’t afford the original $1,000 monthly payment, I pay $500 a month toward my loans. Paying half allows me to pay living expenses and other bills, but my student loan payments only cover interest.

As a high school student, I did not 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 scholarship from NAU, 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 Free Application for Federal Student Aid (FAFSA) loans in 2009.

We attended two workshops that took place in the evening. We went to my high school library with 15 other students and their families and they walked us through the application process. It didn’t really have an impact on me, especially when I was 17 and just wanted to get out of my hometown. I didn’t really understand the implications or severity of the loans, but I think my parents found them informative.

Halfway through college, I ended up losing my scholarship (put on academic probation) and 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 achieve my goal and make my family proud. I asked my dad and grandfather to cosign the loans and assured them that I would work hard so that I could find a good paying job after I graduated.

Reluctantly they 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 2 unpaid summer internships and part-time job as a waiter in a restaurant to save money

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

I would spend almost $100 a week on gas and sit in stopped traffic every day. Also, I was getting calls every day asking about my monthly payment of $1,000. Just like today, no matter how much I paid, I wasn’t putting a dent in my original borrowed amount.

When my internship came to an end, I was offered a full-time position at a public relations agency in Los Angeles, so I left NAU without officially graduating. He was eager to get a full-time job, but with an entry-level salary he 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 got a student loan forbearance, which stopped payments but not interest. This helped for a couple of years, but my payments restarted 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 worked remotely for an agency in Los Angeles and another in Phoenix while working as a Postmates server and driver at night and on weekends. I was doing very well 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 tuition at NAU: just $85 per credit hour. This helped me defer my loans for another year, but the interest kept growing. With private loans, you can only defer your payments when you’re in school—specifically, if you’re going back to college, attending graduate school, or participating in an internship, internship, fellowship, or residency.

When my loans were deferred, I decided to focus only on my work and save money. Since the cost of living in Arizona rose dramatically, almost to California levels, during the COVID-19 pandemic, I am back to where I was financially a few years ago.

I feel like there’s no end in sight

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

I go back and forth on this issue as I see both sides. I think the loans should be repaid, but I don’t think interest rates should be as high as they are. It is the interest rates that are screwing the whole world.

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

Leave a Reply

Your email address will not be published. Required fields are marked *