As American students now cumulatively owe about $1 trillion in student loan debt, Yahoo is publishing first-person accounts from those who are still paying and those who have lessons to share. Here’s one story.
FIRST PERSON | I am a survivor of student loan debt.
The rest of my life will no longer be identified with student loan debt. Having had this student loan debt will affect my normal daily living activities for the rest of my life. My decision to help my children attend higher education to improve their ability to be gainfully employed was a honorable one. It is too bad that Congress does not hold these debt factories to the same standards as the taxpayers.
Due to the hidden costs of this Congress approved federal funded program to encourage the disabled, the low-income, the military veterans, the high school seniors, the older workers training to current market skills, the higher education debt factories profit from start to finish, using taxpayer funds to gouge the population it is supposed to help. The shell companies switch loans, adding fees, service charges, and increasing capitalizing interest to continue the profit for the higher education debt factories.
When I signed the first set of parent plus loans, I was working full-time. When the student graduated much later than the original contract set up, I discovered that we were charged double for the same school term. Hurricane Ivan managed to turn our lives upside down, inside out, and after dealing with insurance, contractors, and putting our lives back together again, I didn’t have any energy left to fight with the company of Sallie Mae and Department of Education.
The second set of parent plus loans came when I was on unemployment benefits searching for a full-time gainful employment situation. I signed, keeping track of the contract dates (having learned from the first set of parent plus loans), and learning after graduation that the student was double charged for the last two terms. I argued the case with the company of Sallie Mae and the situation was not resolved, it still is not resolved.
As a person with a disability, I have had to advocate for reasonable accommodation for my disability in the workplace. I continued to search for full-time employment. Only after the long-term unemployment benefits ran out, did I request a deferment for long-term unemployment. Three times, I was sent paperwork for economical hardship which is not the same as unemployment. The paperwork was finally approved, however, in the meantime, I had had to completely wipe out two 401k accounts with the additional penalties for withdrawing the funds early.
When the diagnosis was determined that my disability would be permanent and total, my disability assessment put me into eligible status for social security disability. The direction of zero income to $500 a month is a definite improvement. However, the direction of $1800.00 income to $500.00 income with no relief for any bills with any creditors has created a vacuum of struggling to make ends meet.
After the approval of my social security disability was completed, I then started the process to meet the discharge requirement of the Department of Education for total and permanent disability. The doctor who reviewed my disability assessment had to submit, in layman terms, in a tiny line at the bottom of the form, to every single lender, signature included, of my disability being total and permanent. I had to have several evaluations to meet the lenders’ requirements, submit to pages of “confidential, personal, and private” information revealing my disability in terms that leave no doubt of the medical conditions effect on my normal daily living activities.
Along comes the IRS with the form 1099 C to collect the tax on the cancelled student loan debt. Form 982 insolvency questions meant a three hour consultation with taxpayer advocate, a congressional inquiry, and mailing in tax return because Form 982 is not a normal form. The choice is simple because it means the difference between a tax refund or having to pay $9,700.00 taxes on the student loan debt that was cancelled due to my total and permanent disability.
Neither student is gainfully employed in the field they graduated from, either.