Student Loan Fiasco

Posted by Joshua C. Snable | Apr 05, 2018 | 0 Comments

So, what do I do with these student loans?

That's a question I hear often. So, what is the answer? Well, that is a little more complex.  First and foremost, there is a massive crisis in America involving student loans, more namely the delinquency rate of these student loans coupled with the sheer amount of the loans that is due & payable. Somewhere, along the line, WE, as Americans, thought that it was "every American's RIGHT" to incur massive amounts of debt in order to go to college. Read that last sentence carefully....does that remind you of anything? Just like it was every American's right to live in a house that they could not afford...right?!?! Well, we've dealt with the former, so now it's on to the latter, the student loan crisis.

Let me be clear -- it is every American's right to his/her life, liberty and pursuit of happiness, and most often for our young people that entails achieving a college education. However, incurring debt, enormous amounts of debt at that, should be no one's burden at an otherwise joyous graduation. Just like it wasn't every American's right to own a huge house that they couldn't afford. At some point, we, as a nation, have to stop with the mentality that "I deserve X," and replace that with the Original American Dream (henceforth referred to as OAD), that says "I can have X and anything else, as long as I'm willing to work for it." I could speak on this line of thinking for many more blog posts, but I'll save the preaching for another day.

Now, let's look at what someone can do with their student loan. There's a great site out there, Student Loan Borrower Assistance, which is run by the National Consumer Law Center, which contains some very useful information on one's options in dealing with a student loan. We'll cover just the basics here, though, including:

  • Don't let your loan(s) get delinquent. That means, that upon graduation (preferably, if not sooner), establish a plan on how to attack and pay these loan amounts. Speak with your specific lender and get a game plan together.
  • Be wary of these third-party companies that offer assistance. The original lender/servicer has a vested interest in seeing that you pay these loans in a timely fashion.
  • If, upon graduation and after your initial forbearance period, you still do not have gainful employment, or are grossly underpaid for your dream job (let me be the first to say "welcome to the club, buddy!"), then remain in contact with the lender for further options. There are many repayment plans available, and various hardship programs (e.g. income based repayment plans, additional forbearance, etc.) that may be available to you. However, you MUST remain in contact with the lender.  
If you do not remain in contact with the lender, they will presume that the debt is either noncollectable, or that you are unable to pay, and your loan will be bundled and sold to a third party servicer. This servicer does not have the options available that the original servicer may have had at that time in the past. Thus, you will likely not receive favorable treatment.  Recent study from Brookings Institute states that nearly 40% of student loans may be in default by 2023. That's alarming, if true. 
If you feel that you have exhausted all available avenues and still have the tremendous burden of these loan bearing down on you, you may need to seek legal counsel. There are likely legal options of recourse that you have not considered. 
I wish you all health, wealth and happiness. We, as God's greatest creation, were made to lend and not borrow (Deut. 28:12), and have life abundantly (John 10:10). 

About the Author

Joshua C. Snable

Joshua is a life-long resident of Birmingham, AL. He is a 2004 graduate of Mississippi College School of Law, and is founder and partner of Snable Law, LLC. Joshua is a current member in good standing with the Alabama State Bar and the Birmingham Bar Association, where he participates in the...


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