Johanna Daile, a third-year student studying history and psychology at John A. Logan College in Carterville, Illinois, knew they would have trouble concentrating in virtual classes. They decided to quit school during the outbreak to focus on paying back their loans, because they had accumulated $58,000 of debt over three years of college.
The epidemic continued and got worse. Daile relocated to Mississippi in September 2020 to be near her family. They worked the same position at another Dairy Queen location. The young man was employed a few more times before finding their current position at Kay Jewelers.
Daile couldn't get their loans deferred because they didn't graduate, so they couldn't go back to school. Half of their paycheck goes to their payments. Daile said that the risk of taking on more debt severely limits their options. If they are able to return to school by 2025, that's their goal.
40 million Americans have student loan debt. It can keep people out of important things in their lives like buying a home or obtaining a degree.
The student loan interest rates were set at zero as of March 2020 under the CARES Act. President Joe Biden pushed the deadline to resume payments to January 31, 2022.
The president announced on Wednesday that he would extend the pause to May 1, 2022. Biden promised on the campaign trail to forgive $10,000 in student loan debt per borrower, but he has not said if he will do the same.
The difficulties that 40 million borrowers have faced during the Pandemic have been acknowledged by Biden in his announcement of the extension.
While our jobs recovery is one of the strongest ever, with nearly 6 million jobs added this year, the fewest Americans filing for unemployment in more than 50 years, and overall unemployment at 4.2 percent, we know that millions of student loan borrowers are still dealing with the impacts of the Pandemic
The Department of Education would offer support programs in the meantime and help borrowers make payments come May 2022, according to Biden. The extension doesn't solve the crisis of student loan debt, according to many borrowers.
Daile said that she wished it could help those who cannot afford to finish their education and those with private student loans. Lower-middle class to low class people are barely surviving with their payments, even though they are in the upper-middle class.
Student loan debt is not a problem for the younger generation according to Alan Collinge, founder of StudentLoanJustice.org. According to the Department of Education, more than half of borrowers are over 35 years old. Older people owe more than younger people even though they may have borrowed less money in the past.
Members of the Student Loan Justice Facebook group were reached out to by a news organization. Many of them reacted to the extension with personal stories.
One more online class is needed to get a bachelor's degree in nursing from the school. She took out loans when she was studying to become a nurse. She graduated in 2008.
Allen said that she was a single mom in poverty and wanted her children to have a better life. The cycle of poverty stopped because my granddaughter doesn't know what hunger is.
Allen has paid off $90,000 in loans but still owes about $75,000, because her initial loan was less than half that amount. Allen was charged excessive interest and fees on her federal loans when she was in her third year of the bachelor's program. She is subject to a wage garnishment, which means a percentage of her disposable income is being taken away until she pays her loan or is not in default. She said that until the first pause in loan repayment came during the Trump administration, one-quarter of her pretax income had been garnished.
The announcement of a loan repayment extension by Biden came as a relief. Allen believes she will have to drop her dream of a master's degree to focus on paying off her loans once payments restart in the spring.
Is it retirement? A home of our own? Allen said that she has a blood clot disorder and has a related disease. The repayment pause has given her a break from her financial obligations so she can care for her husband, who has end-stage cancer, as well as address her own health issues. Allen said she can't afford to move closer to family and friends in New England because she needs her current work-supplied health insurance to pay for her husband's cancer treatments.
Allen said that he would like to work less and take care of his own health, but he can't because of his loans.
Michael Goolsby, a 56-year-old who works at a Walmart in Fernley, Nevada, said that Biden's new deadline will delay his wage garnishment because he has been withholding 15% of his paycheck to pay off his loans. Goolsby had $25,000 in student loan debt when he finished his master's degree in history from Colorado State University.
He was told that he faced a default. He said that his school wouldn't release his transcripts to potential employers. He took out a $36,000 loan to consolidate his debt after accepting an offer to do so. He said that multiple payment deferments and defaults compounded his debt and led to a wage garnishment. He wants to keep his debts down so he can eventually file for bankruptcy.
He said that his student loan debt is more than $100,000.
I worked in IT for 15 years, worked on an assembly line for six years, worked in a law firm for six years, and drove a cab for 15 years. I am here.
Schanck, a teacher in Georgia, said he owes $80,000 in student loans.
He went to graduate school to improve his life and increase his income, only to add on more loans. The predatory lending system certainly did not help, but Schanck blamed himself for not thinking about the cost of a graduate degree.
He said that not using his hard-earned money to pay off his loans has allowed his family to invest in his community. They put a new roof on their house to stop the leak and have been shopping from local businesses.
The money will be taken away from the local economy once the payments start again.
Yirzely said she feels both relieved and stressed by the extension. She has over $40,000 in debt from her master's degree in teaching. She said she can pay back what she borrowed if interest is paused.
She said that she was stuck because her loan was 60 percent of her savings. I can either pay off my loan or be in debt indefinitely.
When it comes to taking out loans for a home or a car, she feels like the deck is already stacked against her. I'm scared once I hit pay, my student loans will be canceled.
She wondered why borrowers weren't allowed to just pay back their loans without interest.
She said that she was stuck in a horror movie waiting for the interest monster to get her.
The extension is not enough for a 31 year old in Portland, Oregon. The extension is not enough for millions of borrowers, according to the man.
She said she owes a lot of money to Lock Haven University of Pennsylvania. She said she struggles to get by because of her loans and her salary as a journalist. She said it has been difficult to talk to the government and her loan servicer on the phone.
When you ask the servicer for specific information, they point to the school. The schools don't have to keep records for more than 5 years according to my institution. I wanted to see how my loans were used. I don't know if I'll get an answer. It would have been nice to know that the records would be destroyed.
State schools are supposed to be more affordable, but it wasn't for her. I want to be able to buy a home.
Amy is a former teacher in Louisiana, who asked that the news only use her first name for privacy. She said she paid off her loans after nearly two decades, but still owes $30,800.
She said she thought President Biden would help Americans like herself who have been taken advantage of by predatory loan systems. It looks like I was wrong.
Even after 20 years of payments, I owe almost as much as I borrowed. Amy told a news organization. I have resigned to the fact that I will never be able to pay them off. I will bury them in my grave.
Amy has applied for forgiveness programs before but has always been denied. She said she thought President Biden would help Americans like herself who have been taken advantage of by predatory loan systems. It looks like I was wrong.