In Their Own Words: Student Debt Stories from Minnesotans
This is part of an ongoing series by Higher Ed, Not Debt highlighting student debt issues and personal stories across several states.
The student debt crisis in the United States continues to grow, and the impact of the crisis is being felt across the lives of 44 million people across the country. Totaling at $1.5 trillion nationwide, student debt has a significantly debilitating effect on the lives of students and families. It presents a fundamental issue that majorities of the public want to see addressed.
Collectively, Minnesota borrowers owe more than $26 billion in federal and private student loan debt. While data on the total number of federal and private student loan borrowers is limited, we at least know that the total number of federal student loan borrowers in Minnesota is above 762,000, according to the office of Federal Student Aid. Including people who only took out private loans, the total number of borrowers is expected to be higher.
In 2017, 68% of BA graduates in the state incurred student debt from an ever-increasing price of higher education – their financial futures foreclosed upon due to this debt. On average, Minnesotans who graduated from public or private 4-year colleges owe more than $31,700 in student loans: the 9th highest average in the country.
However, this debt doesn’t just come from college tuition and fees alone. In addition to the holistic costs of the college experience (housing, food, transportation, materials, etc), students may find themselves deeper in debt because of predatory practices by student loan servicers. Hundreds of thousands of borrowers are subject to the exploitative practices of student loan companies that increase borrowers’ debt burdens through sloppy servicing and deceptive counseling practices.
Others are victims of for-profit college scams. After the uncovering of widespread fraud and abuse among some of the largest for-profit college chains, defrauded borrowers are still left holding the bag.
To best show the real affects of the student debt crisis, we want to go beyond data alone. We want to share some the stories that Minnesotans submitted to us that illustrate the many ways that student debt is impacting their lives, and their calls to fix this crisis.
The debilitating impacts of student debt:
“I am a co-signer, parent. I am making payments on the private loans and my daughter is making payments on the federal loans. The debt is preventing her from moving forward in her life and preventing me from putting aside [money] for retirement.”
~ Valerie B.
“I’m getting close to paying off my debt (another 7 years or so) but my husband is going to be paying his off forever! He’s been paying for over 10 years and only paid off $1000 of the principal. The government (or whoever has our loan) is making a TON of money off us in interest. My husband will still be paying this off in his 80s – though I doubt we’ll be able to afford the payments at that time. So the little SS money we might get would be garnished to pay this ridiculous debt? If the government wasn’t charging us tons of interest on this loan, we could have already had a huge chunk of it paid off. Shame on them.”
~ Aimee M.
“Interest rates have added so much to my original loans, I’ll never be able to pay off despite my willingness to. Also, spent two plus decades post undergrad and graduate school in non-profits organizations serving disadvantaged populations, but did not fall under program timelines that provided loan forgiveness for this—which would have had me stay committed to that career track but could not afford it with loans.”
~ Cynthia D.
“I went back to school after my divorce to make myself more marketable and have better options for supporting me kids. I have money in a retirement account I want to use to pay off my loans but I would take a 20% penalty for early withdrawal, which makes this impossible, so the gov’t has me over a barrel–either I get killed on student loan interest or in a 20% hit on my retirement. I just want to pay off my loans and then repay my retirement — but I am set up to stay in debt ( or my kids will be because they will inherit my debt if something happens to me).”
Problems with student loan companies:
“A for- profit student loan collection agency did not serve my best interests by covering up how they were applying my monthly payments to my Stafford loans. I am not happy with the agency that they sold my loan to but at least they are up front about interest charges! There needs to be more accountability by loan servicers who handle loans originally made by the Federal government to prevent them from taking advantages of cash-strapped borrowers!”
~ Katherine N.
“I am 67 years old. I paid on my student loan for years but have since defaulted. 15% of my social security is taken out every month along with my rent credit in August amounting to nearly $2,400 a year for seven plus years. I have been hounded by collection agencies, had three calls yesterday and one at seven thirty this morning. I have been lied to, threatened, laughed at, never given a straight answer, never taken seriously. My children have been called, businesses in the building where I live. Many of these collection agencies have been relieved of their duties because of fraudulent tactics…I know I’ve defaulted with no way out…but this has become the focal point of my life; not grandchildren or volunteering or gardening.”
~ Kathryn C.
“They should protect students because there’s almost a consumer law for anything that’s purchased. Why should this be any different? Especially for colleges that partook in illegal and misleading recruitment practices. I was a victim of these schemes with the for profit school I attended.”
~ Justin K.
Victims of predatory for-profit colleges:
“I went to Brown College in Mendota Heights in Minnesota. The degree I got is not worth the paper it is written. We found out that school was not accredited the way they said they were. If we wanted to transfer to another school we would have lost most of our credits. The only graduate program we qualified for were all online schools.”
“I went to the [Everest College] Egan Minnesota Campus . I all a’s and b’s (except one mod when they changed my teacher and it was a little hard for me to adjust) graduated and when it was time for me to get a job, they did very little to help me. I had employers tell me that they wouldn’t hire me because i went to Everest. I graduated in 2008 and I still haven’t gotten a full time job. Yet I’m $14,000 in debt for loans I didn’t even take out…”
~ Uniquica A.
“I went to Everest institute. I graduated 2007 with diploma with GPA [of] 3.85. I have not be able to find a job, but I am still paying my loan. Which is not fair after they promise me they help me find s job. They didn’t do anything for me except taking my money. I deserve to get full refund…”
~ Hiwot W.
These people could be your neighbors, your co-workers, they could even be you or members of your family. Their stories are relatable, and therein lies the problem: too many people are suffering under student debt, and more will if we don’t tackle college costs and crack-down on predatory practices by industry. We must solve this student debt crisis for Minnesotans and for the rest of the country.
Posted on 17 September 2018