<p>Hi everyone- first time here.</p>
<p>I have a question that I may already know the answer to, but I'm hoping for someone to help me think outside of the box. </p>
<p>About 5 years ago, my student loans got sidetracked because of losing my job and being smothered in medical bills and funeral expenses for my mother. Because of everything going on, I had no idea the loans were in default. I had no idea, that is, until I was in the middle of a divorce and had to seek bankruptcy counseling. </p>
<p>The lawyers told me that while student loans would not be covered in the bankruptcy, they would automatically go into a deferred status. This, unfortunately, was a lie. </p>
<p>I've enrolled for online classes at a local university and just found out that I'm ineligible for any financial aid because my student loans are in default. When I contacted the clearinghouse that is responsible for my loans, they told me I would have to pay 6 consecutive months of my loans to get out of default...which is absolutely un-doable at the present time. </p>
<p>Unfortunately, paying out of pocket for the six hours I want to take is also financially out of the question. </p>
<p>I'm not even really sure what I'm asking for here...maybe advice, or guidance, or something. Going back to school was my last ray of hope in a series of really bad situations, and now I'm just sick about the prospect of not being able to go.</p>
<p>It sounds like you have been in default for 5 years (?) and “unaware” of your loan status of being in default. This is just simply something that needs to be cleaned up however you can, even if it means delaying going back to school. </p>
<p>I would have you focus on the idea that if you can not afford to make 6 months of on time payments for your old loans that you really are not in any position to be thinking about taking on even more student loans! </p>
<p>While the idea of getting your college degree is likely tied to future job prospects, realize that in most fields these days a degree does NOT equal a job guarantee. And even if you get a job because of the degree, it does NOT mean it will pay well enough to cover the amount of outstanding loans.</p>
<p>Concentrate on the good news you do have - you have gotten out of denial about your prior student loan debt and are ready to tackle it now. Maybe it will take 1 or 2 years to get to a place that you can make those 6 months of payments… but that will be time well spent and money well earned and debts (partially) well paid off. It is a step toward financial freedom, though maybe not as fun or exciting initially as jumping back into college.</p>
<p>I am very sorry for the loss of your mother. </p>
<p>Is it possible to take one class at a time (paying cash) while you work to make your current student loan repayments? That would be my advice.</p>
<p>Best of luck.</p>
<p>PS - If you would like more targeted advice, I would suggest you share more details. Specifically: what is your major/career objectives? what state are you living in? what is your current student loan debt (with penalties)? what do you need in terms of future loans? a list of alternative living/working/schooling situations that you are contemplating already. That way people can try and help you craft a realistic “path” toward your goal.</p>
<p>Wasn’t thinking about taking more in student loans, actually. I’m more frustrated that I am not eligible for any grants or things like that. Believe me, along the lines of loans, you’re not telling me anything I don’t already know.</p>
<p>Ah, grants! Well, I think you are stuck in terms of getting out of default anyway possible before you can qualify for grants. Best of luck.</p>
<p>The student loan industry has amazing power-you can’t walk away from these loans. They can go after your income for life. So you need a plan. You won’t get grants or any kind of aid until you are on a repayment plan. Negotiate with your lenders and you can get back on track for school in 6 months.</p>
<p>my financial aid office told me that if I can take 6 hours, my loans will automatically go into a deferred status-but I haven’t been able to verify that.</p>
<p>I don’t believe you got correct information from the FA office - remember they are a bunch of desk jockeys who know the basics but often still mess up basic information. I have seen this time and time again (getting bad information from college counselors about financial aid, loans, college policies, transfer details, and more).</p>
<p>From URL [Repaying</a> Student Loans Held by the U.S. Department of Education](<a href=“http://www2.ed.gov/offices/OSFAP/DCS/repaying.html]Repaying”>http://www2.ed.gov/offices/OSFAP/DCS/repaying.html)</p>
<p>“If you default on your student loan, the maturity date of each promissory note is accelerated making payment in full immediately due, and you are no longer eligible for any type of deferment or forbearance.”</p>
<p>Since you are already seriously in default, the option of going back to school part time in order to qualify for deferrment is no longer available until you get back into a good status with them, such as the 6-months of on time payments.</p>
<p>These loans are sticky - and amass great penalties if in default. You are way past any easy solution such as taking 6 credits to defer payments. I would work out a payment plan and see what you can whittle it down to in terms of a monthly payment. </p>
<p>Paying this off may mean even more radical lifestyle changes that you haven’t even imagined yet - like moving in with a grandparent or other low/no-rent situations. A new town. A second or third job. Etc.</p>