With $1.2 trillion in student loan debt outstanding in the U.S., almost anyone you meet walking down the street has a strong opinion about education costs...
Hey guys, it’s Miss Money Michelle here with Debt.com. Did you know that there’s $1.2 trillion of student loan debt in the United States today? That’s crazy! So, we’re hitting the streets of sunny Fort Lauderdale to ask what their take is on the current student loan debt crisis.
What do you think about the current student loan situation in the United States?
I don’t think too much about it; I try not to think about it, but I’m trying to get rid of it as fast as I can.
I mean, I always advise people not to take it if you don’t have to.
Student loans are unfair and they suck.
That’s a really loaded question. I ditch my student loans and eventually I will die.
That’s my theory on student loans.
She went totally rogue.
How do you think President Trump is going to help people with student loan debt?
That’s a great question, but I have no idea.
I think he should probably put some of his personal money forth to help students pay off their loans.
I can tell you what I hope he does, and I hope that he works on cutting interest rates and some student debt forgiveness.
All kidding aside, the student loan debt crisis in the U.S. is becoming more and more pervasive. It affects everyone from millennials just starting out to seniors living on a fixed income. So, we dug into our Education Center archives to give more details about some of the responses we received. Here’s what you need to know:
Can you just hide from your lenders until you die?
This might sound like a good idea, but in practice it’s impossible. Hiding from federal student loan repayment isn’t like hiding from a debt collector for something like credit card debt. The federal government knows you. They know your Social Security number. They know your employer anytime you file a W-2 or 1099. Trying to dodge student loan repayment is a bit like trying to dodge the IRS on tax debt. It’s possible in theory, but nearly impossible in practice.
First, you would have to avoid any job that files taxes on you. That means no W-2 employment or even 1099 freelance work. You would have to be paid completely under the table to avoid wage and tax garnishment. This is even more problematic when you consider federal student loans have no statute of limitations. They can pursue you forever.
Considering most jobs where you get paid under the table won’t put that degree you earned to good use, this probably isn’t the best solution.
How does President Trump plan to help borrowers?
So far, President Trump and his administration have not directly tackled student loan debt. President Trump has been critical of programs put in place by his predecessor, such as the Public Service Loan Forgiveness Program. Experts now estimate that PSLF will cost the federal government up to $108 billion in the coming years. However, although he’s been critical of the cost, President Trump also suggested that loans should be forgiven after 15 years.
When the new administration does make a decision on student loan debt, it will come from the Department of Education. That means Betsy DeVos will spearhead any efforts for relief. And if you’re like our political finance writer Brandon Ballenger, her leadership doesn’t exactly leave you with warm fuzzy feelings.
What you can do now
Waiting for a decision by the administration may take a while, considering issues like healthcare and tax reform come first. If you have student loan debt to eliminate now, it’s best to take advantage of the programs already in place. This is especially true for something like Public Service Loan Forgiveness that may be eventually stopped.
Anytime the federal government offers a relief program that they stop, anyone already enrolled is not kicked off. For instance, a mortgage relief program called HAMP (Home Affordable Modification Program) ended in January 2017. Homeowners can no longer apply. However, even if you only submitted the first round of paperwork before January 1, 2017 you can still qualify and take advantage.
With that in mind, if you work in a public service sector — as a nurse, teacher, firefighter, police officer, or some other public service field — then you want to get into PSLF now. Otherwise, the option may be off the table if President Trump’s administration decides to cancel it. Even if you don’t work in public service, don’t wait to consider relief programs. Federal repayment plans such as income-based repayment may be up for revision or elimination, too.
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Article last modified on May 18, 2017. Published by Debt.com, LLC . Mobile users may also access the AMP Version: Man on the Street: What’s Your Take on the Student Loan Debt Crisis? - AMP.