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JerseySmarts.com

Hope For My Student Loan Debt…Maybe

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Yesterday, I found out that the rules and regulations for the College Cost Reduction and Access Act of 2007 (CCRAA) were finalized. These regulations included something called the Public Service Loan Forgiveness Program. In short, this program allows those working for nonprofit organizations to have the balance of their federal student loans forgiven after ten years of payments (with the clocking beginning in October 2007). The payments do not need to be consecutive, they just need to be comprised of 120 monthly payments (paying twice in one month does not count as two payments). I had to find out more about this program, so I contacted the program administrator in Washington, DC to get the facts. Here is our conversation starting with my e-mail to the program administrator:

My name is Joe and I am contacting you about the Public Service Loan Forgiveness Program created by the College Cost Reduction and Access Act of 2007. I have been working, full-time, for nonprofit organizations since May 2005. I have approximately $56,000 in federal student loans (a Direct Loans consolidation loan) and $48,000 in private student loans.

I understand that the private student loans do not qualify for the new provisions, however, I want to confirm that my Direct Loans consolidation loan does qualify. Also, I’ve read that the new regulations apply to payments made from October 2007 forward. Since I make my payments each month, does this mean that I can count my last 14 payments towards the 120 required for the balance of the loan to be forgiven? Is there anyway to count the previous monthly payments that I’ve made since I began repayment in July 2006?

Please let me know if you need any additional information. This is exciting news!

And here is the response from the program administrator in Washington, DC.

Good Morning Joe,

Your Direct loan consolidation loan will qualify for the forgiveness, and will count payments beginning on October 2007 forward. So, all payments made from the Oct. date on will count towards the 120 payments. Sorry, none of the payments made before that date can or will count towards the 120 payments. I’m glad that the public service forgiveness program will be a great benefit for you. If there is anything else I can do to help, please let me know.

A very friendly response from the feds – I like it! I thought that I should return the favor with a comment or two of my own and another question or so.

Thank you so much for the information! A final question or two.

First, do the 120 payments need to correspond to 120 months? Or if I make two payments in one month does that count as 2 payments towards the 120?

And finally, is there anything that I need to sign up for in order to be a part of this program? Or do I just track the payments on my own and when I hit 120 payments I contact Direct Loans?

And, within a matter of minutes, the program administrator replied as such…

One payment per month is what counts towards the 120 payments and direct loans will track the payments for you, we are also in the process of developing a form to have your employer sign as a public service position to tie the job with the payments.

This was perhaps the most pleasant experience that I’ve ever had dealing with my student loans. The representative, Ms. Nikki Harris, was professional and courteous and showed the utmost in professionalism in her prompt responses to my questions. And on top of that, I might be looking at getting some of my student loans forgiven after another 106 payments!

I have to figure out what I’d like to do with this, actually. I’ve been making excess payments on both my private NJHESAA loan and my Direct Loans consolidation loan. However, since I am being charged more on my NJHESAA loan and there is a possibility to have the Direct Loan forgiven at some point, it might make sense to begin adding more to my monthly payments to NJHESAA and then see where I’m at in a few years with the Direct Loans. The problem that I have with NJHESAA, though, is that you can’t make online payments – it’s so archaic.

Anyway, I take this information about the Public Service Loan Forgiveness Program as a good sign. This is a good way to begin the new year!

“Significant” Progress on My Student Loans

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Regular readers of this blog will know that I am in some major student loan debt. As detailed in my front page USA Today article from June 2006, I graduated from Rutgers University with a Master of the Arts in Public Policy…and over $116,000 in student loan debt. For a young guy (I was 25 at the time that I graduated), this was almost like being handed a financial death sentence just as I was getting access into new doors of opportunity by virtue of my degree. Well, I’m here to report some type of “significant” progress on paying back my student loans.

When I graduated, I had some $49,000+ in NJHESAA loans (a private organization), $59,000+ in Direct Loans (loans from the US Department of Education), and more than $8,000 in a private student loan from CitiBank. Since graduation, I’ve completely paid back the CitiBank student loan and I’ve lowered my total outstanding loan balance to slightly more than $107,000. I’m not sure if someone would call this “significant” progress on paying back the student loans, but I think bringing down my overall balance by about $10,000 in two and a half years isn’t so bad! If I didn’t have to pay any of my other expenses, I could have had more than half of the loans paid off by now, but I’m satisfied with my progress.

My short-term goal is to break below $100,000 by March or April of 2009. I think this is completely doable so long as I continue to not have major automobile problems. If I have to buy a new car, then my goal will be to break $100,000 by the end of 2009. Getting below the six figure range will be a great mental victory in paying back these loans and I’m looking forward to it!

In any event, though, there’s a progress report on my student loan repayments. I’m doing a pretty good job of putting all of my available extra cash into paying down my student loan and not squandering it on unnecessary expenses. I win!

Stay Away from NJHESAA!

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For all of you high school seniors in New Jersey and current undergraduate students – this one is for you.

When looking to find a way to finance your education, stay AWAY from the New Jersey Higher Education Student Assistance Authority! They are, by far, the most rotten folks that I’ve come across in my time as a college student. To begin with – they are NOT a public organization! That’s right, they may be called the NEW JERSEY HESAA, but they are not a public group. What does that mean? That means that they use higher interest rates and give little to no wiggle room when it comes to flexibility on repayment options. This is a private company, yet when you submit your Free Application for Federal Student Aid (FAFSA), some schools will list the NJHESAA as a source of funding. STAY AWAY!

And if you want to know what it’s like to deal with them once you graduate and it comes time to repay, it’s even worse. In short, their customer service motto might as well be summed up as “The customer is always wrong…and is a moron, too.”

Not once have I hung up the phone and not been aggravated after talking to these people. That is if you can get them on the phone! As I type this I am on minute 18 of being on hold since I called to ask them about a payment. That’s right, for 18 minutes of my life I’ve heard nothing but a mellow tune and some completely rude “for shorter wait times, use our automated system” messages.

Back to their “customer service” people. For those of you that don’t know, you can have your NJHESAA payments deferred if you are still in school. Well, after I graduated from my undergraduate school, I went right for my Master’s Degree. I went to school both during the school year and during the summers – which Rutgers has documented very well for me. Yet still, last summer these asses at the NJHESAA randomly listed me as not being at least a part-time student for the month of June (which was false) and then in August, they reported me to the credit bureaus for not paying my monthly payment.

Bear in mind, I had no monthly payment and after they realized their mistake in June, they immediately put me back as “deferred” in July. Yet still, they wanted that mysterious, random payment from June 2005 (which they never got because it was completely uncalled for). After battling with them and telling them that they were wrong for putting me into the credit agencies, they still claim that they are 100% right about their mistake. Rutgers told them that they were wrong and I told them that they were wrong, yet they still believe in themselves as being right. Morons. By the way, minute 24 on hold.

Thankfully, I have Triple Advantage Credit Reporting from Experian and when I told the Experian people about the complete disaster that the NJHESAA is and how they goofed on their records and proved themselves incorrect by reinstating my part-time status in July 2005, they removed the “missed payment” from my record. I like Experian, they do a good job of protecting regular consumers like me from bastard assholes like NJHESAA.

As a side note, you should know that I have never missed a payment on anything that I’ve ever had to make a payment on. When I was $25K in credit card debt, I still made every monthly payment. When I owed $15K for my new used car, I made every monthly payment. I’ve never missed a cell phone payment or a water bill payment. When I had a landline phone, I paid the scam artists at Verizon every month on time. My credit record indicates this and that is what I believe led Experian to remove the stupid claim that NJHESAA made on my account.

OH! How could I forget the worst part about an NJHESAA loan? You cannot consolidate it anywhere but with them! That’s right. It’s a private loan and they will only allow you to consolidate it with them. Don’t look for this statement on their website or look for it in any of the promotional materials that you are sent (unless you love reading the fine “fuck you” print at the bottom of the page). They won’t tell you that!

I can only imagine what would happen if the public-at-large held NJHESAA responsible to its namesake. How dare they go around claiming that they help make college affordable? What a sorry crock of bullshit these assholes are. I’m going to end this post now after a full 30 minutes after being on hold.

Scumbags. STAY AWAY!