Just to scare us all further Forum

[AtticusFinch]

Her first mistake was going into family practice. The low pay can make it difficult to repay $250,000. in loans. Probably a lesson that can translate into parts of the law profession. Sitting down with a loan calculator can be a sobering experience, if you've never tried it I would highly recommend it.

I'm pretty sure there are programs that will pay for people to go into family practice (pay for most, if not all of their med school) if they give up like 3 years of their life to work in an underprivlidge area (maybe more than 3 years?)

If there are such programs obviously she didn't take advantage of them.

[existenz]

She's a fool. If she cut her living expenses dramatically (you can live just fine for $30,000 per year) and took the highest paying medical job she could find, she could have her debt covered in a few years.

Time for her to buy Suze Orman's book.

[nycparalegal]

Well did a little bit more research on the woman and found a post WSJ article interview with her:

1. Are you surprised at how popular the story from the WSJ has become?

Yes. I knew it would grab people’s attention because of the number, but I’m surprised at how many people picked it up. Rush Limbaugh, Ron Paul and Michael Moore picked it up. Radio commentary and on-line as well. Rush Limbaugh blamed the govt. for the high fees that I was charged. At the time, I thought that he didn’t know what he was talking about, but I’ve learned some things [which I will get into later]. On Michael Moore’s website, one of the most popular articles is one featuring my story. They are on opposite ends of the spectrum, but they both used the article to make their points. It was very strange. Those are the just the ones that I got to. It was nauseating at first to see how popular the article was; I’m a private person and to see my name all over was very embarrassing. But people need to know what’s going on. What’s happening to students is criminal. In regards to the government’s involvement, I thought that Sallie Mae owns Financial Management Systems (FMS), my lender, but FMS is basically a government agency. 80% of its revenues come from the government. It contracts with the Dept. of Education and Dept. of Treasury. It’s basically a government agency. So, it’s the U.S. govt. that charged me that $53K penalty for default. FMS collects on student loans, Medicaid, and Medicare for the government.

2. Why did you decide to give your story to the WSJ? Two reasons. First, I wanted people to know about these crazy fees that you are charged if you default on your student loans. It’s outrageous and criminal and legalized loan sharking. Second, I want parents and their kids to know what they’re getting into when they get a loan. What does it mean for interest to accrue, what does it mean to defer, what happens if I default? These are the tough questions that kids need to ask if they decide to sign on for a student loan.

3. If you could do it again, would you? What would you do instead? I don’t know. There are not too many things that I love to do and medicine is one of them. I used to be a personal trainer. Both professions go hand in hand, really.

4. Why did you decide to leave being a Personal Trainer? That was a side job. I did it while I was going to school. I didn’t think it would be satisfying. I wanted to go to law school, but I found out that Columbus has the most attorneys anywhere per capita. So I decided that isn’t a good idea. At the time, I foresaw taking out 70K in loans, and not finding a job as an attorney. So I went back and did pre-med requirements in two years after college and went to medical school.

5. What is your current monthly payment? My loan is partially in collection. $550-600 and the other one, $990, with only $100 going to the principal. They are trying to charge me another $32K penalty fee, so that the loan can be sold to another student loan company. They are asking that I sign on and agree to that penalty. I am meeting with attorneys and trying to figure out what I can do to avoid this. I’m trying to enter the Income Based Repayment program but I’m not sure what portions of the loan will qualify and what won’t. It’s been 2 months since I applied. I know I’ll be paying this back the rest of my life.

6. What caused you to fall behind? I did my residency and Wells Fargo loans came due 2 years into my residency, so I started paying on those loans. I deferred the others while I did my residency and then I did a fellowship in sports medicine. While I was in my fellowship, I defaulted. I was not making enough to survive, so I couldn’t pay it.

7. Did you live extravagantly while in Medical School? Do you live extravagantly now?? Far from it. I drove a used Honda and lived in an apartment. I haven’t been on a vacation in five years. I still own a used Honda accord. I live in a house my boyfriend owns. Like I said, I haven’t been on vacation in 5 years.

8. What is your plan for tackling your student debt? I have applied for IBR and that’s all I can do. You can’t get out of student loans. I can’t not pay them. They garnish wages. I’m getting 100s of emails about stories much worse than mine. At least I don’t have children and I have a job. I’ll be okay and I’ll be able to pay these, but the fees are absolutely criminal. A lot of these people are not going to be okay. It’s horrible what they are doing to people that tried to get an education, better themselves and live the American dream and now they are indentured servants for the rest of their lives.

9. If called to testify before congress about your student loan experience, would you? Yes, I have become the poster child for the student loan crisis. Without a doubt.

10. Do you have any feelings on the student loan scam? Do you think that the system should change? I think there is a scam, evident by some of the actions of the Bush Administration when they created the 2008 budget. I won’t get into that, but there was something seedy in the way that Sallie Mae was dealt with. But this take over by the U.S. Government of student loans is a good thing, to take out the middleman. But it’s the government is the one that charged me these unreasonable fees. So, I don’t know what to say about that. But I know that the middleman is making billions of dollars off of us, which is criminal.

11. Any advice to students? I advocate higher education, but doing it smart. Take out as little as you can, if you can live at home and stand your parents, take out low interest loans, and be aware of what would happen if you get out and can't find jobs in your chosen field. Especially now, when so many people can’t find a job in their field. Know what kind of money you will be looking at repaying. You cannot get out of student loans. You have to pay them. People say the two things you can be sure of are death and taxes, but add to that—paying off student loans. They need to know what can happen. Get a major that you can get a job with, like being an engineer. But don’t go to school, just to go. Like getting an art history degree. That won’t work and you’ll probably be waiting tables. I don’t want to keep people from going to college, just know what you’re getting into. I have given some thought to whether we’re better as the uneducated masses or the educated masses. I think it’s better that we’re educated. Because if we’re educated, we can fight this.

http://butidideverythingrightorsoithoug ... helle.html

[gossipgirl]

So she had 500k in loans owed and instead of trying to get the highest paying job after residency, she decided to do a fellowship in sports medicine?

Yeah, I wonder why interest accumulated...

[nycparalegal]

So she had 500k in loans owed and instead of trying to get the highest paying job after residency, she decided to do a fellowship in sports medicine?

Yeah, I wonder why interest accumulated...

It was actually around 230,000. It accumulated into 500k (interest, late fees, and default charges)

[gossipgirl]

So she had 500k in loans owed and instead of trying to get the highest paying job after residency, she decided to do a fellowship in sports medicine?

Yeah, I wonder why interest accumulated...

It was actually around 230,000. It accumulated into 500k (interest, late fees, and default charges)

She took out 230k and I'm sure interest accumulated throughout her residency, if not while she was in school. You're right, it's definitely not 500k but it's substantially more than 230k.

What's interesting is that she didn't just take out loans for medical school; she had also taken them out for her "post-bac" program for 2 years to finish her pre-reqs for medical school. This probably means that interest had been accumulating on private loans for a long while.

My point just is that if you have about 300-350k outstanding in loans after a 2 year mandatory residency period, you can't worry about what you "want" to do (ie: fellowship), but rather how you're going to pay off the loans. Not doing so lands her in the situation she finds herself in.

Private loan companies certainly have some bad practices, but she should not be the face of the opposition, as I can't find sympathy for her situation.

[nycparalegal]

Yea, but learning more about her story. The fees do seem pretty excessive. I guess that being the point so it discourages you from defaulting.

I didn't realize she did a residency then a fellowship until reading her interview.