What happens if I don’t pay my student loans?
This is getting to be a very hot topic. Did you know that Student loan debt just surpassed credit card debt and unlike credit card debt you typically can’t just file for bankruptcy and have student loans erased? For profit schools combined with the federal government backstop for student loans has been the main reason why tuition have been skyrocketing way faster than inflation. Here are the highlights from a very interesting article you should take a look at before you choose to rack up a ton of student loan debt.
Please read this article and think very hard about your “exit strategy” regarding your student loans. Meaning – How are you going to pay back those student loans?
Here is a recap of the bad things that can happen if you fail to pay back your student loans:
1. If you still have federal student loan debt at social security retirement age the government can take up to 15% of your benefits
2. Wages can be garnished
3. Tax returns can be taken from you
4. $104,000 student loan turned into $1,750,000
5. If you a professional with any kind of state license ie. Doctor, Lawyer, Accountant etc. if you default on a federal loan you can have your professional licenses revoked effectively stealing your job away from you.
6. If you are in health care and you default on a federal student loan you will be excluded from Medicare and Medicaid payments.
7. If you go into default you may be unable to apply for any forgiveness programs
8. Interest rates and payments can skyrocket
For more information on how we got here and other horror stories to really get you thinking hard about that “exit strategy” click here.