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I Can’t Afford to Pay My Student Loans…What Can I Do?

By The Golden Law Group

Most people know that the total amount consumers owe in student loan debt is now more than 1 Trillion dollars. Yes, that is $1,000,000,000,000! Student loan debt now exceeds credit card debt in this country. But unlike credit card debt, it is very difficult to discharge student loan debt in bankruptcy. Notice I said difficult, but not impossible. However, this article is not about discharging student loan debt in bankruptcy. I will save that for another post. Today I want to focus on how you can deal with your student loans outside of bankruptcy.

The repayment options available to someone struggling with their student loan payments depends on the type of student loan they have. Some loans are either issued or guaranteed by the government and one set of rules and options apply for those. Other types of loans are private loans and they are a whole other ballgame!

First, let’s talk about government loans. The standard repayment term for a government student loan is 10 years. However, if you can’t afford the standard 10-year repayment plan, there are many repayment options available to help you afford to pay your federal student loans. There are extended payment plans, graduated payment plans, extended graduated payment plans, pay as you earn payment plans, income-based repayment plans, and income-contingent repayment plans. Confused? Which of these payment plans would be best for you? To better understand all of your student loan repayment options, I recommend you speak to a student loan lawyer. There are several of us around who are up to speed on all of the different repayment options and can provide you with an analysis of your situation and make a recommendation to you.

Ok, now let’s look at private loans. Private loans are issued by banks or other financial companies such as SallieMae. However, just because you make your payments to SallieMae doesn’t mean that your loan is a private loan. SallieMae not only issues loans to consumers, they also service loans owed to the government. If you are unsure if your loan is a private or government loan, you should contact a student loan lawyer to help you figure it out. So, you have now determined that you have a private loan and you can’t afford the monthly payment they are demanding, what can you do? Not much! This is one reason why private student loans should be avoided. The payment options listed above for government loans are not available for private loans. Private loan companies do not have to work with you regarding your monthly payments.

So, as you can see, if you have a federal student loan there are many repayment options and one of them should be able to be affordable to you. However, if you have a private loan, your only options are to pay or not to pay. If you take only one thing away from this article, let it be this…avoid private student loans if at all possible.


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