That's because when it comes to repaying an education loan, no one - except maybe Mom or Dad - is more lenient than your Uncle Sam.
Can't find a job? Or, the one you have barely pays the bills? Maybe you have decided to go back to school to wait out the recession. Whatever the situation, the government has options to provide relief - sometimes for years - from federal loan payments while you get your finances in order. You might even have your loans forgiven over time.
"If students are conscientious about it and they explore their options, there shouldn't be any reason they would be in default, even if they don't have a job," says Mark Lindenmeyer, director of financial aid at Loyola University Maryland.
You run into trouble, though, if you blow off repaying the taxpayers who put you through school. The government comes down hard. Real hard. It might garnishee your wages, apply future tax refunds to the debt, prevent you from renewing a professional license, hit you with interest, late fees and collection costs, and even ding your Social Security benefits in retirement.
The poor job market is blamed for the rising defaults in federal loans. For those in their early 20s - with or without a college degree - the unemployment rate is significantly higher than for their older counterparts. The Bureau of Labor Statistics reports the unemployment rate grew to 16 percent for those age 20 to 24 in November, while the overall unemployment rate dipped slightly to 10 percent.
No comments:
Post a Comment