Slowly, reality slips in.
No one is helping students consolidate loans anymore. Not Sallie Mae, not Next Student, not Bank of America, not Student Loan Xpress. After many calls, I ask an agent who is helping me over the phone, “Why is it that all the loan agencies have stopped accepting applications for consolidation of federal student loans?”
A pause. “Because it’s uneconomical,” the agent says. “The only place left doing it that I’ve heard of is the Department of Education.”
I say thank you, hang up, and dial the number for the DoE. Even though it seems strange to borrow money from the federal government and then turn to that same government for a better deal through consolidation, it’s my only option. If I stay with my current loan agency, I’ll be stuck paying $447 per month for the next ten years—an unfathomable number for by my accounting. That’s more than half my monthly income…and that doesn’t even include my undergrad loans, which, as of this month, are now in repayment.
The application process through the DoE is easy. I try the sample loan calculator and discover that even if I took 30 years to payback my $38,000 in grad loans (How did it get so high? I only missed two interest payments!), the payment would be $250 per month. Much more palatable than $447. But it’s likely my payments will be significantly less because I’ve applied for the type of consolidation that takes into account my annual income.
Have I mentioned that since George W. Bush has been in office:
a) Students can no longer consolidate their loans annually, meaning that they must earn their degree before consolidation, allowing interest to accrue at higher rates for as many years as they are enrolled in school.
b) Students are paying, in some cases (mine included), up to three times what they paid in interested as undgrads. Compare my Whitman loans at 2.3% to my current loans at a blasphemous 6.8%.
c) The funds available for SUBSIDIZED federal Stafford loans have diminished substantially—hence my last interest payment bill, which arrived in the mail shortly before my graduation. Interest alone? $1,300. Also, hence earning a degree that cost under $30,000 but graduation with loans nearing $38,000 because of interest, total lack of subsidies, and additional cost of living loans taken out to cover – you guessed it – $600 plane tickets twice a year.
Ok. I’m done. Except I also want to say I have $27 in my checking account.
And also, I want to say that the house I live in is being shown on Thursday. A potential buyer.
A year ago, this is what I put out there to the universe: I just want o graduate without having to move again. I got my wish. And I have to say, in full honesty, that I would leave this house in an instant without a trace of betrayal or bitterness if it sold. My time here has been a gift of immeasurable influence. I’ll stay as long as I can, and when I must go, so be it.
And the last thing I want to say is: I still feel lucky and grateful and I’m still writing. Those are intangible things and I refuse to let them be disrupted by issues of money (borrowed and earned), moving, or otherwise.
Katey, thanks for this post. I’ve also been struggling to keep up with my loans and am currently paying something like $600 a month, which is hugely unsustainable for me. I will call DoE today! Hooray!