Meet a recent college grad with $143,000 in student debt: 'There have been times when I didn't eat' to afford the payments
Private student loans are not included in the federal student debt relief talks.
Insider spoke to Karla, a recent graduate with $ 143,000 in student debt - $ 91,000 of that private.
She's defaulting on her payments and wants her student loan to help.
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Karla graduated from Sam Houston State University in May 2020 and keeps pushing herself to call her student loan company Sallie Mae because it's connected to her.
She has a student debt of $ 143,000, including $ 91,000 in private loans whose payments were not suspended during the pandemic. She falls behind.
"It is really my private loans that are slowly killing me," said the 26-year-old and asked that her last name be withheld because she feared legal consequences.
Campus housing was expensive and on-campus jobs only allowed part-time work at the minimum wage, so Karla turned to Sallie Mae to help fund her education and additional expenses on top of the federal aid she had already received. But once she took out these personal loans, her debts quickly piled up thanks to the high interest rates. Despite keeping up with her monthly payments, she hasn't even touched the amount she originally requested.
President Joe Biden extended the pandemic hiatus in student loan payments until the end of January, but most private student loans were not included, meaning people like Karla continued to pay off student debts in a time of extreme financial uncertainty.
"There were times when I didn't eat and I was very stressed to make my payments," Karla said. "It literally felt like I was working to pay off loans. I didn't work to live or to have a life - I worked to pay the loans."
"You have to pull your teeth and nails to get help"
Insider previously reported on the difficulty both government and private student loan borrowers are having in getting help from the companies that are collecting their debts, and the situation was no different for Karla. She said that while she was in college, she tried to educate herself as best she could about how to repay her loans, but since graduating during a pandemic, her financial situation has changed and she didn't have the money to Sallie Mae requested the payments to make the payments.
"They originally asked me to pay $ 1,000 a month after I graduate," Karla said, which she couldn't afford. “So I called and they said I can pay $ 900 a month instead.
Given that she had other obligations besides her loans, such as paying for groceries and gasoline, Karla has fallen behind on her debt burden and said she wished the private student loan portfolio received the same attention as federal student loans so that she would have more options to pay off her debts and apply for loan relief. Personal loans account for 7.89% of total student loans outstanding.
"It's perfectly fine to give you a credit card, but you will have to pull your teeth and nails to get help repaying the loans," Karla said.
Covering the origins of Sallie Mae in his book The Debt Trap, Josh Mitchell of the Wall Street Journal said that Sallie Mae was founded by Congress in 1973 to give people an education, but the company grew to "tremendous" Prioritize profits "from lending to borrowers," which borrowers often let down ".
Sallie Mae did not respond to Insider's request for comment.
Although private student loans make up the bulk of Karla's debt, she still has $ 52,000 in government student loans and said that "every amount counts" when it comes to loan origination.
Biden campaigned for a $ 10,000 cancellation of student debt per borrower, and Democrats are pushing for that amount to be increased to $ 50,000, and Karla hopes Biden and Congress will see the grant Credit is something "that has to happen". But the president has not yet commented on a timetable for whether or when this forgiveness will come.
"It's about helping people live their lives better, and if that means canceling their student loan debt, do it," Karla said. "I'm hopeful, but I'll believe it when I see it."
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