Hopefully my post about this isn't removed like it was in the past - Robert doesn't seem to want people to know about legal options that will actually help them....
First of all, I would like to introduce myself; my name is Mark Sadowski. I have a bachelors in Architecture from SUNY Buffalo (2006), a Masters in Construction Management from NYU (2011) and a Masters Certificate in Real Estate from NYU (2012). I finished undergrad with about $28k in student debt, and have now tallied another $72k at NYU, even whilst working full time during my studies. $100k total for people who are too tired to do math after a long day trying to fathom their student loan debt calculations. (-:
Just consolidated (all federal loans....You have to do what is smartest. More protection on fed loans) and chose IBR which I barely qualify for, but due to having a son, business expense deductions and max allowable IRA contributions, my determining AGI is below the cutoff. Fine.
I have a steady, good job which provides me enough income to make my IBR (~$700/month) payment or extended (~$790/month) payment for 25 yrs. I also started a consulting business which I intend to gain business from (www.mStudiosArchitecture.com). I live in NYC, so I know these numbers all seem high, but it is all relative, I assure you - I came from a poor family in Buffalo, NY looking at $28k as a daunting amount of debt. Now, $100k doesn't even phase me.
The problem, as we all know, is that by paying this sum of money to the DofEd each month, it does not allow me (us) to save for anything - referring to real property. This inherently deters growth, hence, controlled inflation, and ultimately, the real estate market. The last thing people with student debt will do is try to buy a house, yet alone, start saving for a house - especially those indentured to a 25-year plan.
So if the government isn't going to help ease the burden, we should come about a more intuitive way to ease the burden on ourselves. Obviously under IBR, your balance is forgiven after 25 yrs, but 25 yrs is a lifetime, and will be detrimental to this economy. That lengthy term will only add to the growing income/wealth gaps with age and class.
The other method, working for a "public service agency, such as a state, federal or
local entity," OR working for a "certified tax-exempt 501(c)(3) organization," will allow the federal loan borrower to achieve forgiveness in just 10 years!
Now I know you are saying; "501(c)(3) organizations pay nothing" or "how would I even begin to find a job at a 501(c)(3) organization." Well, it is easier than you think...
YOU SET UP THE ORGANIZATION YOURSELF OR UNDER SOMEONE ELSE's NAME AND FILE FOR 501(c)(3) status through the IRS. @RobertApplebaum just filed for (c)(4) status - if he wanted to create a way out, he should have filed as a (c)(3).
How does this work? Well, let me tell you that after sitting on the phone with the Dept. Of Education, Great Lakes Student Loans Borrower Services, Direct Loan Consolidation and the office for the Secretary of Education, there are NO stipulations within the Dept of Ed that do not allow you to do this!!!! I had every single person on the phone baffled over my inquiry. They were all speechless.
Details: I am already filing a new Corporation as a (c)(3) sometime in the next month or so, after which I will start paying myself minimum wage at the required 30 hrs/week mandate that is outlined in the forgiveness clause. I will be an "educational/charitable"entity dedicated to (here's the best part) educating and making students or grads aware of the student loan lending world, repayment plans, as well as a link to other great/helpful sites such as Robert's. More details to come, but I will have a website set up soon.
How and why will this work? The D of Ed doesn't set the 501(c)(3) standards, the IRS does. D of Ed doesn't determine which (c)(3) organizations qualify, because if you achieve that status, they all do. Done.
Math: In my example, by paying myself minimum wage ($7.25/hour) at 30 hrs/ week x 52 wks a yr = $11,310/year (yes, this is additional taxable income, but you can "donate" these funds back to your (c)(3) each yr to avoid tax). Now, under IBR, that additional $11,310 above and beyond my other (normal) income will have a sum taken out for the IBR payment. ($11,310 x .15 = $1,697/12 months = $141/month additional payment for 10 yrs).
So, $141 x 12 months x 10 years = $16,920 extra payment over 10 yrs WITH FORGIVENESS DUE TO PROOF OF EMPLOYMENT FOR A 501(c)(3)
Beats the hell out of the original option: additional/remaining 15 years under IBR NOT working for a (c)(3) = $700 x 12 months x 15 years = $126,000
$126,000 - $16,920 = $109,080 savings
Yes, I would rather save $110,000 And according to the way the loan terms, repayment terms, promissory note and D of Ed mandate is written, it is the current, legal law.
I would also like to say that I am by no means "complaining" about my student debt; I would do it all over again if I had the chance. I am just trying to come up with legal ways of "paying off" the debt, and/or utilizing the current systems in place to get some of the debt thrown out.
Hopefully Robert Applebaum doesn't delete this post like he did the last one - it seems like he is trying to hide something from his followers by NOT allowing this post to show up on the blog, even though it is a LEGAL route and HELPFUL for many.
Links to many of your questions below:
1) Loan Forgiveness Fact Sheet
2) Dear Borrower Letter
3) Instructions for Employment Certification
4) Employment Certification Form
5) Q & A's (PAY ATTENTION TO Q53 - YOU CAN CERTIFY YOUR OWN TIME)
I've been getting a 6 month battle with direct loans and also have talked to numerous managers but nonetheless have no assist concerning the following scenario.
Essentially, the scenario is as follows. About 8 months ago I began a brand new non profit occupation. I took this occupation due to the direct loan public interest forgiveness plan(i wouldnt have otherwise). When i began the occupation, I signed up for IBR and setup my account to create little payments below the automated payment method. My loans had been fairly higher and i wasnt needed to create any month-to-month payments but i paid anyways to be able to begin tolling the 120 payments.
A month or so later on, direct loans switched to their new web site and kicked me off the automated payments that i was creating. They stated that below the new web site “zero dollar” payments would count in the direction of the 120 payments for loan forgiveness and that I'd no longer be permitted to create little month-to-month payments. I've asked them numerous occasions to send me a letter displaying me this extremely reality as well as displaying me how numerous “zero” dollar payments(so i wont get harm in ten many years) I've produced because my begin of employment with this particular non profit. They maintain telling me they'll do that but dont. I'm extremely worried that each one of these previous months won't count and there's absolutely nothing i can do to create genuine payments below the new method.
Registering businesses in the UK and Company incorporation preparing taxes for both individuals and businesses. We are also involve in web development and internet marketing activities.
As Debtfreedude mentions, I cannot (either) make out most of your uncomprehensive post, but what I gather is that Direct Loan is not "requiring" payments through IBR because you are below the threshold for requiring someone to pay 15% of their non-disposable income above 150% of the poverty line guidelines. Therefore, you "$0" payments DO IN FACT count towards your 120 required payments towards forgiveness. If you visit my post about 501(c)(3) organizations just a few days ago, you will see a link to a "QandA" fact sheet produced by the Dept. of Ed.
You should really document everything yourself, do the employment certification forms each year, and you should be well on your way to public student loan forgiveness. Just do some reading, research into the federal mandates and bylaws, and I'm sorry to say, but try and be a little more coherent in the future on here so we can properly respond to your comments.
And yes, you can ALWAYS pay more than the minimum required payment through IBR. That is expressed everywhere. In your Promissory Note (which you seem not to have read), on the IBR Info website, on the Dept of Ed website, and on the Direct Loan and Direct Loan Consolidation website. The reason they won't "automatically" withraw a payment every month because one is technically not due under the IBR program.
Are you sure you have a college education? Is English your first language? I'll give you the benefit of the doubt, but your writing is nearly incomprehensible.
What did you major in? Are you mobile? The key to finding a job in this economy is mobility. Forget mom and pops and Aunt Jean down the road that you love to spend time with..........move to where the opportunity is.
Well stated argument/story. Most of us will pay and/or will attempt to pay back the system for our education (that WE chose to attain), but it is not our fault when the system spits in our face or shits us back out in the deep end.
I feel lucky to have the job I need/require with my level of debt ($100k) to be able to supplement myt student loan payments, because I have many more colleagues from Yale, Columbia, Harvard and other great schools that still cannot find work that they hedged their bets to find, and really have no options right now. One of my friends received his JD from Harvard in Fall 2011 and still cannot find work with a starting salary that he assumed he would receive - which is what people were receiving for example in the NYC market between 2001-2008. That is not his fault. There is no reason interest should be accruing on loans as such. But I do feel we should have to pay back the debt, or at least pay a standard or IBR payment for 10 years, then maybe qualify for forgiveness.
Because what happens if you or I work for 5 or 10 years, making all the required payments, then run into a roadblock (physical injury/emergency, another disastrous job market, etc...), then we will have to suspend our payments, go into deferment and/or forbearance, and interest will just begin piling up again. By the time we start repaying again, if we happen to land a lucrative enough job, the debt pile has grown back to where it started in most cases. That is what I don't like.
This country places emphasis on "higher ed," and "promotes college education to all American citizens for the beterment of the country and its advancement," but the government in turn does nothing to help subsidize or really make it affordable. Interest rates on graduate fed loans are 6.8% and 7.9% respectively. In my scenario, this was the only way to get a high paying job, and get ahead of the 8-ball, as I'm sure you can relate to. But 6.8 - 7.9% ???? Are you kidding me? The government obviously doesn't want to make college affordable when they are pulling a premium on it. That's why they honestly don't care about rising education costs. They just keep on spewing out more loans, and higher lending limits. That is what is ridiculous.
My education (loan consolidation) is costing me an interest rate of 7.125%. My auto loan lease is 1.9%. WHY???? I could go buy a $50k diamond from a jeweler for 0% APR for anywhere between 6 months and 5 years, yet the government chooses to charge 6.8% or more for graduate education? Doesn't make sense.
Hang in there. Check out my 501(c)(3)post. (-: