Question: I have already been paying the minimum payments ($156/month – mostly interest very little principle) on my student line of credit since January. The LOC was for $17,300. In October I will begin repaying my government student loan ($286/month). I’ve done the math and there is no way I will be able to cover basic living expenses and pay back both loans. Is there anyway I can negotiate a lower monthy payment with either agency and how?
Negotiating Payments On Student Loans
Without seeing your student loan documents it is impossible to give you an accurate answer. It would appear that you recently stopped being a student and that your student line of credit is not a government guaranteed loan; you are paying the bank directly. You may be able to talk to them and negotiate lower payments, although that is never easy with a bank. A credit counsellor may be able to help you negotiate on your behalf either directly or through a Debt Management Plan.
As to your government student loan, you can apply for an interest free period, but it is also difficult to make a deal with them. However, it doesn’t hurt to ask, so talking to them directly is a good starting point.
If you have stopped being a student for more than 7 years, you do have other options to settle student loan debt. If this is the case for you, contact a licensed trustee in bankruptcy to talk about how to deal with your student loan debt.