Student Loans and how they effect you can have a different outcome based on millions of different factors involved. The interest rates are usually very high and unless you have great credit or something worth more than the loans, you can't get another loan at a smaller rate to pay them off. The best way to skip the interest that they tack on is to just pay the loan off in a lump sum. For those of us that haven't won the lottery or inherited a Trust Fund it's not so easy.
I'll be the first to say this. I am a blue collar person, always have been and always will be. I'll also freely say that going to school was a huge waste of time and money for me. Why did I go to school then? Easy enough. I was refused a Warehouse Manager job because I didn't have a degree. I was told that I had the experience, the knowledge and the abilities but since I didn't have a degree the company didn't want me. So I asked my interviewer what kind of a degree a person needed to tell their employees how to organize and run a warehouse.
Their reply was, "Any kind." Turns out, some companies just want to know that you have a degree to show that you actually stuck something out for the long run. Seriously, some employers require a certain number of college credits. They can be anything and the classes that you take don't even have to reflect on the job your applying for.
That's when I decided to go for one of the easiest degrees I could think of. Multimedia and Web Design at the Illinois Institute of Art in Chicago. I basically decided on this since a close friend at the time had taken the same course. I had helped her with many of the assignments and it seemed easy enough.
I went to the school and had all my paperwork ready and talked with an admissions adviser. We went through the financial aide and it was told to me that I would be completely covered for the entire 3 year length of the course by financial aide. This was important at the time since I was already working a full time day job just to keep up with rent and bills.
Half way through the course my financial aide was declined. I was told that it had ran out. This didn't make any sense to me since it was already told to me that I would be fully covered for the entire course. At this time I was carrying a 3.2 grade point average and working 2 full time jobs.
So I decided to cancel the classes I had and just drop the course. I went to the counselors and talked to them about dropping the classes I had scheduled. They said to me that it was past the drop or add time period and even though I was dropping the classes and not attending them I would still have to pay for them. This made no sense to me at all.
So now fast forward to the Summer of 2007. I've now been working between different door jobs and I was very interested in becoming a Police Officer here in Chicago. One of the requirements is that you must have 60 college credits. Once again, the college credits could be from anything and not necessarily classes focused on Criminal Justice.
This I believe I do have based on the Illinois Institute of Art and a previous community college that I had went to. But alas, I can't get my transcripts since I owe ILIA money for classes I never went to and dropped before the classes actually started.
So. Now that the backdrop has been set.
It's now 2008. Most of my loans have been in forbearance. This means that you get a certain amount of time that you don't pay for the loan. The payments are added to the end of the loan but the interest still accrues as if the loan is just larger. Basically you get charged double interest on the payment. As with one loan I had that was for about $11,000 and has been in forbearance, it is now for about $14,000. These figures aren't exact.
All my loans are through Sallie Mae as I'm sure many students loans are. Sallie Mae has a huge amount of employees and a slow computer center. You can make a payment and still get calls from them for a week or more after the fact asking you to make a payment. It's only when you tell them to check the records that they will notice that you did make the payment a week prior.
A few months ago I had some loans that came out of forbearance. Sallie Mae, being the spokes company for efficiency, never reported that this happened. One would think that a company that is trying to get money back from you would let you know in some manner. Four months after the loans came out of forbearance I started receiving emails and phone calls. They want their money or the loans will default.
I, like some people, have a hard enough time creating credit. I don't need these school loans to default. Not only will it effect me but it will my co-signer as well. So I made a call to Sallie Mae.
Once on the phone with a pleasant southern accented associate I start asking questions. How much are my payments? When are the payments due? How much to break even with all the loans to this date?
The associate gives me a total amount to bring all of my loans current. I stress the word all because according to this associate an amount just short of $500 would bring all my loans current until the month of July. Then I would have a constant payment due for many more years to come. So in order to get everything current and save all the hassles I pay out the amount just short of $500 and get everything cleared away.
I'm now preparing to include these monthly payments into my budget. Thus, the addition of another job once again and the work schedule of 6 - 7 nights a week.
2 or 3 weeks pass. I start to receive phone calls from an unlisted number. I don't answer phone calls from unlisted numbers. Then I start to receive phone calls from a cellular number based out of Los Angeles. Then a cellular number from New York. I receive another call from the same cellular number from Los Angeles and decide to answer. Normally I don't answer numbers I don't know and return the calls if a voice mail is left.
I answer the phone and it's off to the races.
"Hello?"
"Hello sir, is this Derek D?"
"Sure is."
"Hi this is ____ from Sallie Mae services. Our records indicate that you owe $___. How would you like to take care of this today?"
"Excuse me?"
"Sir, this is Sallie Mae Student Loans. We're calling about the student loans..."
"Your calling me from a cellular phone number out of LA. Sallie Mae is located in Indiana."
"Sir, we have many different phone numbers. Now if I can just get your information."
"How bout you tell me my information. If your Sallie Mae then you already know it."
"Sir, we don't give out information over the phone."
"That's funny, I don't give my information to people calling me from a number registered to a cellular phone in LA when they're supposed to be at a company in Indiana." Then I hang up and call Sallie Mae.
I talk to a supervisor at Sallie Mae and report the problem. Turns out that it was them calling. They have different numbers that are not registered to them in order to try and collect debts. I ask why they're calling me since I just became current 2 - 3 weeks prior. To this the supervisor said I was not current and that he would transfer me back to an associate.
Turns out the associate that had helped me prior overlooked the different types of loans I had. There are two different types, private loans and federal loans. She had overlooked the federal loans. So I was close to defaulting on the federal loans. Even after asking her several times, "Now this brings me current on all of my loans correct?" she failed to realize that she had overlooked the federal loans. However, when I asked how much my monthly payments would be she didn't overlook them. She had the monthly payments correct.
After talking with the new associate I was able to put my federal loans into forbearance once again. After making the $500 payment only a few weeks ago I am maxed out on making any more huge pay outs.
I almost wish Sallie Mae was fully automated. Phone to computer, no errors unless there's a glitch in the system. Human error seems to be way too high when it comes to services like these. The people sit in a room with a headset on and read prompts off of a computer screen. No thought needed.
In fact, if you ever receive a phone call from this type of a business ask questions. Ask questions that will involve the person to back track and re-read. You can base the level of intelligence or boredom of the associate on their response time. It's kind of a fun game.
If you really want to have some fun then turn the tables. Ask the associate their Zodiac sign, their date of birth, their favorite ice cream and tell them that these will all be questions used to verify that they're actually living and breathing human bipeds and not quadrupeds from the 3rd moon orbiting Uranus. If they don't laugh and you keep with it claiming that they must be aliens, give yourself a pat on the back if they hang up on you.
Not to worry, they have a toll free number and if you call back odds are you won't get the same associate again.
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