Warning: The Debt Rant

[NickiLaughs, ADN, BSN, RN]

Hi!

It was suggested upon a recent post I made, that I share this information here as well, as a warning to those who are thinking of taking out private loans for excessively expensive programs for nursing school or not even that, just to live on while in school. There are a few things I wish I had known when I was originally financing my education. Had I thought things through more, I wouldn't currently be paying 74,000$ in student loans, and very concerned about my family's future and mine due to the approx 1,000 a month payments.

Please keep in mind, many will say "this won't happen to me" but I've noticed a trend of nurses on here, whether recent graduates, or graduates of several years ago, this is them, and it happens to someone, me included.

#1 How Private loans versus Federal loans ARE different. Private loans suck, because the interest rates tend to be higher, and the payment plans is often flexible but always with a ton of interest. When I was accepted to an accelerated LVN to RN program, I had previously done business with Sallie Mae. They USED to be a government entity, I thought they still were. They no longer are, and now I'm stuck with a 7.25% variable Student loan. This loan cannot be combined with federal loans, cannot be consolidated with them and it cannot be reimbursed by the government through their loan repayment programs or most other entities.

False belief: "I'll just get a job that offers a loan repayment program" I thought that was going to be my solution, well, doesn't technically work. Most loan repayment programs are only done with FEDERAL student loans, private loans, such as Sallie Mae Signature are not going to be covered or eligible for these programs.

#2 How Private loans versus Federal loans ARE the same: filing bankruptcy because things just got too much? I have, guess what? The private loans are still protected by the government, even though they really aren't any better than a credit card, you don't ever get a break, and they will come after you and garnish your wages should you default. So you get none of the benefits of the federal loans, but all of the negatives with private.

#3 If you have to finance your education, another poster said, "never accrue more debt that you can reasonably make in a year" They are more than correct. You really shouldn't even accrue half of that, because life HAPPENS and things take a turn. My plan upon graduating was gain some experience and then I was going to be a travel nurse. I had a husband that got very ill. Instead of being responsible, and putting off my BSN, I dived right back in and acquired a ton of debt for a degree I wanted, but truly did not need at the time. I tried to predict the future, I assumed my husband would stay healthy, I assumed we'd always have his paycheck, or at least until we were financially ready for him to go back to school, now we don't have that option.

False belief: "I will just work a lot of overtime, and pay off all those loans with that"

The belief that your going to make enough money to pay off debt, or be able to work overtime or a per diem job as extra and pay off debt isn't a guarantee. No job is required to give you overtime. I currently live in California, and I can tell you, everyone is scrapping for work out here. Experienced nurses are unemployed. I actually had to leave my last facility because we were getting called off so often and I wasn't working. There is no extra shifts, there is no overtime. If there is you are fighting a lot of other nurses for it. I think I've managed about 3 hours of overtime at my current position, and I've been there 5 months.

Currently all the things I planned to do to pay off the debt have fallen through. I live in a tiny (900 sq ft) 2 bedroom apartment. My husband hasn't worked since 2008. And I currently have the biggest stress of my life. While I hopefully have something coming up to help me out, it is not a guarantee.

How did I acquire all this debt? I didn't have patience. I see so many students on here who are thinking of going to an expensive program because they don't have patience.

I got my LVN at 21, granted, I was in a hurry to support myself as my parents were giving me a year prior to having to move out on my own, so that was a necessary student loan: 17,000. Minimum wage as a grocery clerk doesn't support that, and we were on strike anyway.

Paid about half: 9,000 left

Was in a generic LVN to BSN state school, actually had my tuition paid because of my State job at the school, but was taking out loans every pay period to pay my mortgage because my husband got ill: 10,000

Dropped out of that program because I got accepted to a private 9 month LVN to RN program, and I was probably going to lose my state job because of the budget cuts: 36,000 (there's the private loan!)

Went BACK to the BSN program because the economy was taking a turn for the worse, and wanted to remain competitive in this market: another approx 19,000

So there's my 74,000 bucks.

I don't have a nice car, I have just a used economical car, no car payments. I don't have cable TV, I have netflix. I don't have a nice Iphone with a verizon plan. I've got a crap phone with metro pcs. I can't go out to a nice dinner with my husband, because we can't afford it. I haven't bought new clothes or scrubs in the last 6 months, even though I really need some of both, because we can't afford it. My son needs new shoes, and I've been having to put it off. And I make approx 78,000 at my current job.

So those who think they are going to make all this money, and can afford this debt, keep in mind, most people have a car payment, most people have other big expenses, and saddled with loan payments that equal their rent will come close to breaking them, both mentally and financially.

I'm not here looking for suggestions or ridicule, I'm just showing my desperate situation, hoping to prevent someone else from making the same mistake.

[tiffjh2]

I have always paid off loans by paying nothing but the interest off first so it don't build and cost me twice as much as it would've.

[HouTx, BSN, MSN, EdD]

OP, Thank you for sharing your story. That took a lot of courage.

In addition to the other cautionary messages that you have provided, I would like to remind everyone that many states, including mine, do not permit professioal re-licensure if a person is in default on student loans... so in addition to not being able to meet financial obligations, the individual cannot work in their chosen profession.

The student loan debacle has been predicted to become an economic disaster that will be at least as bad as the sub-prime mortgage/housing collapse. It is being fed by the dramatic increase in commercial (investor owned) "schools" that are preying off unsuspecting students. Although there has been some congressional debate about this issue, it will undoubtedly be tabled while they are embroiled in presidential carnival season. Sad, very sad.