Do you believe this? The U.S. Department of Education reported that 101 individuals owe at least $1 million dollars in student loans. Due to rising tuition costs and easy access to credit, the amount of people that have accrued at least $100,000 in student debt has increased.
Pursuing higher education has become a financially daunting task, especially if you want a graduate degree. Some graduate programs charge tens of thousands per year in tuition. In parts of the country with high costs of living, graduate students are borrowing hundreds of thousands of dollars to make ends meet.
A recent article in The Wall Street Journal discussed how a former graduate student accrued more than $601,506 in student loans for dental school at the University of Southern California. The former student’s debt is roughly the price of three Lamborghini sports cars. Due to interest and fees, his balance grew to more than $1 million.
What If I Have Mortgage-Sized Student Loan Debt?
If you have a large amount of student loan debt, then you may find it difficult to keep your principal balance from increasing. The minimum payments do not cover interest, which builds up over time if the student does not pay more than the minimum payment.
If you have federal student loans in good standing, then you should check your eligibility for enrolling in an income-driven repayment plan. These programs limit monthly payments to a percentage of your discretionary income and allow you to receive forgiveness for your remaining balance after making timely payments for 20 to 25 years. However, the forgiven amount is considered taxable income by the IRS.
Some graduate students with excessive higher education debt are banking on having their loans forgiven through the Department of Education’s Public Service Loan Forgiveness Program (PSLF). However, there are requirements to receive loan forgiveness under this program. There are also no guarantees the program will exist in the near future.
Need Help With Student Loans?
The Sader Law Firm has experience helping student loan borrowers who are struggling with payments. In one case our firm handled, founder Neil Sader helped a woman settle $400,000 in student loans for $150,000.
Do you need help with student loans? You can reach our attorneys by filling out the online contact form on our website or by calling (816) 281-6349.