Student Loan Question
#31
Gets Weekends Off
Joined APC: Feb 2007
Posts: 440
The borrower is slave to the lender.
Last edited by Led Zep; 01-09-2008 at 11:51 AM.
#32
Gets Weekends Off
Joined APC: Apr 2007
Position: E170 FO
Posts: 686
Agree completely. My problem is that we are not doing a very good job educating young people of what they are getting themselves into. The high school guidance counselor mantra is just "get financial aid" or in plain-speak, take out a loan. We are pushing more and more people to go to college who probably don't need to go to college. They take out massive loans and get relatively worthless degrees just for the sake of having them. There are other ways to get to where you are going, they just might take a little while longer. You might not be able to start at the regional airline at 21, you just might have to wait a few more years.
#33
Gets Weekends Off
Joined APC: Feb 2007
Posts: 440
I even asked Collections to define "something". Unfortunately, $100/mo is nowhere near $650/mo and I got my first wake-up call right after Xmas. They tapped my checking account for the remaining $330 that was in there making it nearly impossible to cover my rent check for December. When I called them on it, they referenced my Promissary Note which says that they can do that. I called some other people "in the know" and they informed me that the next play in the Collection's playbook is to either tap my wife's account (currently live in WI) OR begin garnishing my wages.
My advice to you is this: close your existing accounts and open new ones. Do not give your bank account information to anyone calling you looking for money. As you have seen, they will rob you blind if they are given the opportunity to do so. If they keep calling, then unplug the phone.
If I funnel the money through my wife's account......they'll find it eventually. I've already switched bank accounts....but, they'll find that in time.
why on earth did I think that borrowing nearly $76k ($23k/federal, $53k/private) was a good investment at making $23k/yr?
FIRST: put a written budget on paper. Analyze what is coming in, what is going out, and where is it going. Once you have the basics (food, clothing, and shelter) covered, cut out EVERYTHING that is non-essential from your budget. That may include internet, cable t.v., entertainment, etc.. This may sound drastic, but drastic times call for drastic measures.
SECOND: increase your positive cash flow through extra income. Discuss these questions with your spouse: can either/both of you take on extra work? Can you take a part-time job in your time off? Can you sell some things that may bring you extra income? If you have two cars, can you survive with one? Also, and this might be hard to hear and apply, but do you have any friends or family you can stay with for free or practically free? It would free up some or all of the money you are paying for rent and would allow you to throw it at your debt.
THIRD: for the short-term look at reducing the monthly payments. For the long-term, however, look at paying this monster off in LESS than 15 years.
You borrowed $76K. You stated your minimum monthly payments are $650.00/month for 15 years. 15 years equates to 180 months. $650/mo over 180 months (15 years) will cost you $117K - $41K more than your principal.
Here is what you have going for you. Your career, through CBA's, will allow you an increase in pay each year. You will also get a pay raise once you upgrade, so you won't be at $23K/yr forever. It's going to be tight for a while, but your pay does increase.
Remember this also. Broke is a condition and poor is a state of mind. Make up your mind right now that you are going to pull out all the stops and erase this debt once and for all. Turn the land inside out looking for every penny you can get your hands on - and then throw every penny you can toward this debt.
It can be done. It's going to require some serious sacrifice, but it is an attainable goal. It's been done before and your situation shouldn't have to be any different.
#34
Gets Weekends Off
Joined APC: Feb 2007
Posts: 440
Agree completely. My problem is that we are not doing a very good job educating young people of what they are getting themselves into. The high school guidance counselor mantra is just "get financial aid" or in plain-speak, take out a loan. We are pushing more and more people to go to college who probably don't need to go to college. They take out massive loans and get relatively worthless degrees just for the sake of having them. There are other ways to get to where you are going, they just might take a little while longer. You might not be able to start at the regional airline at 21, you just might have to wait a few more years.
You might not be able to start at the regional airline at 21, you just might have to wait a few more years.
#35
Gets Weekends Off
Joined APC: Dec 2007
Position: CFI, MEI
Posts: 105
i see led zep that you are a dave ramsey listener as well. We just paid off my wife's student loans and I am paying cash for my private. I have, up to this point, been thinking about taking about 45K(I will have 10K saved) loan for ATP and then going back to my desk job and flight instructing on the side until most of the loan is paid off. I don't know if it is a good idea or maybe I should get off my butt and get a second job until we can pay cash. Thing is my wife and I can easily live off of her income and have plenty to spare. I was also thinking I would quit my job all together, use whatever I made cfi'ing and something else and pay it off that way. I don't know if it is a good plan or not. I just paid off 20K worth of debt in 7 months working an extra job, and my wife's income. I know I could pay this off but the kicker is whether to do it before or after the school or maybe go to school gradually. I'm weary of that because my wife wants to have kids fairly soon. Decisions decisions.
#36
I consider anything uner 1,000K in payments fortunate. I have just over 150K in student loans out. my monthly payments are around 1500 a month. I will make just enough, first year fo, to pay student loans and nothing else. I moved back in with my parents, ask for lunch money, and drive their cars so I dont have to pay for gas. It sucks, just find yourself a sugar momma and youll be alright
#37
Gets Weekends Off
Joined APC: Feb 2007
Posts: 440
i see led zep that you are a dave ramsey listener as well. We just paid off my wife's student loans and I am paying cash for my private. I have, up to this point, been thinking about taking about 45K(I will have 10K saved) loan for ATP and then going back to my desk job and flight instructing on the side until most of the loan is paid off. I don't know if it is a good idea or maybe I should get off my butt and get a second job until we can pay cash. Thing is my wife and I can easily live off of her income and have plenty to spare. I was also thinking I would quit my job all together, use whatever I made cfi'ing and something else and pay it off that way. I don't know if it is a good plan or not. I just paid off 20K worth of debt in 7 months working an extra job, and my wife's income. I know I could pay this off but the kicker is whether to do it before or after the school or maybe go to school gradually. I'm weary of that because my wife wants to have kids fairly soon. Decisions decisions.
Yes, big listener of Dave Ramsey and a big believer in his advice. First, congrats on paying off the debt, $20K in 7 months is a huge accomplishment!
I don't know if it is a good idea or maybe I should get off my butt and get a second job until we can pay cash.
Good question though. Right off the bat, I would advise to save the money first and pay cash. The money you will save by not paying interest will afford you nice lunches between flights.
Let's look at the numbers. $45K to go to ATP. You and your wife (congrats again, btw) paid off $20K in 7 months. If you were able to pay off $20K in 7 months, you could certainly save $20K in 7 months. What I would do is to continue to save until you have the cash. I would also look into two other things as well.
First, I would look into (if you haven't looked already) saving money into an account that pays a much higher interest rate than that of a traditional savings account. Second, would it be more affordable to train with another school? I would make the first mandatory and the second up to your discretion.
Thing is my wife and I can easily live off of her income and have plenty to spare. I was also thinking I would quit my job all together, use whatever I made cfi'ing and something else and pay it off that way.
#38
Gets Weekends Off
Joined APC: Feb 2007
Posts: 440
There are raging debates on here about the merits of racking up big loan debts to become an airline pilot. The job doesn't pay enough to pay them back, and it takes years to get to the point where you can pay effectively if you even want to.
I would consider staying out of any such job that cannot pay down your student debts by performing it. There are lots of jobs out there that pay more than entry level piloting. They are not fun but they are there. Go into flying when you can afford it, for what its worth.
I would consider staying out of any such job that cannot pay down your student debts by performing it. There are lots of jobs out there that pay more than entry level piloting. They are not fun but they are there. Go into flying when you can afford it, for what its worth.
#39
Gets Weekends Off
Joined APC: Nov 2006
Position: 737 Left
Posts: 828
#40
Gets Weekends Off
Joined APC: Feb 2007
Position: e190
Posts: 929
i just thought of something as well. did you like flight instructing? If you did then you might want to look into becoming a teacher. In many parts of the country they are desperate for teachers and it is easier to get into then you think. In new jersey they have a program for teachers thats labeled "alternate route." It is only in areas where they are desperate for teachers. you basically teach for a year and pay for someone to mentor you (1000 bucks), you get full benefits, have to take two college courses in your free time and the pay is about 44 grand your first yr in new jersey. After two years of teaching (i think its 2 might be 3) they wipe off your student loan debts. Might be an option. Its not flying but it pays the bills and beats worrying about money. Just an idea
Thread
Thread Starter
Forum
Replies
Last Post