Student borrowers who will continue to struggle

The Supreme Court has barred the Biden administration from implementing its plan to extinguish up to $20,000 in federal student loan debt, and millions of borrowers will continue to struggle under the weight of their loans.

These are students who are lured into aggressive for-profit institutions, whose lofty promises of higher incomes never materialize. These are borrowers seeking higher degrees that are often needed for low-paying but essential jobs in social work, the classroom, or the courtroom.

These are the women who take time off from the job market to take care of their families and do not get back the salary they had before.

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Here are brief sketches of people in other circumstances like these who have struggled and whose challenges are likely to continue.

No degree, but all the debt

Gina McDavitt, 36, is one of millions of borrowers in debt but without a degree, a group more likely to fall into default.

She tried to go to college in her early twenties while working as a bra fitter at Macy’s and took the more convenient route: She started at the College of San Mateo, a community college, and planned to transfer to San Francisco State University.

But the courses required to complete her associate degree were not always offered, which meant she had to wait for them to be offered. In the meantime, the participation fee rose – but her eligibility for the Pell grant and loan did not increase, and she soon struggled to make ends meet.

“I was effectively overpriced,” said McDavitt, who left school with around $3,000 in loans, which exploded after several postponements. “So I have about $8,500 in student loans for a degree that would be free now,” she added, referring to programs that make community college free for eligible students. “That coupled with, I live alone, I’ve been in the same role for a while and I’m in the Bay Area and it’s very expensive here. I struggle.”

McDavitt, who lives in Vallejo, Calif., and works in customer relationship management for a transportation company, said she was passed over for several promotions because she didn’t have the required degree. She recently trained someone who was promoted before her.

“As it stands, the amount of money I make doesn’t cover my bills,” said McDavitt, whose loans went into default just before the pandemic took hold. “I’m a single person making less than $55,000 a year without a degree. The weight of the world rests on my shoulders.

McDavitt is eager to get back to school but can’t afford it.

When Monica Schmidt, 44, gave birth to her son in 2008, she was finishing up a big job in her hospital room. Five months later, she received her Bachelor of Science in Nursing from the University of Phoenix.

She then pursued a master’s degree, which elevated her to the rank of nurse practitioner and gave her the opportunity to teach. Her husband, a sales manager at a food company, worked during the day while she cared for their children, who were 1 and 4 years old. At night, she worked full-time as a supervisor at a skilled nursing facility while taking classes in Northern Illinois. University.

“We couldn’t afford daycare, so we worked in opposing shifts,” said Schmidt, who lives in Genoa, Ill., and now works as a nurse at a therapeutic day school.

But after three years of starting and re-starting, juggling became more difficult with their young children, and in 2013 she quit her lessons. The debt, however, was his to keep. She now owes $64,000, more than half of it for her higher education.

Once her payments restart, she’ll be paying around $450 a month for the next 25 years, or until she retires. She has made 52 of 120 eligible payments for the Civil Service Loan Forgiveness Scheme, but is expected to pay around $900 a month, an amount her family cannot afford, especially saving for retirement and education. colleges of his two children.

“I don’t want them to be in the same situation as me,” Schmidt said.

Another kind of black tax

Recent college graduates with student debt, including 23-year-old Dorien Rogers, face a constant buzz of questions in their heads: Make additional debt payments or start a savings plan? Can I afford to buy a house in the community where I grew up? (In his case, in Montgomery County, Maryland.) What about money to start a family one day?

As a black man, Rogers is aware that black people are more likely to have to borrow and that black women often struggle the most with student debt.

Asha Anthony, 20, a rising senior at Howard University, will leave college with a bachelor of arts in legal communications and about $30,000 in loans. But she’s considering how she’ll fund her dream of becoming a civil rights lawyer, which usually requires an extra six figures in student debt.

She was helped by her mother – who raised three daughters, with the help of her parents, while single – and who will have accumulated at least $30,000 in parental loans by the time Anthony graduates. . Yet her mother is still paying off her student debt.

“I am determined to attend law school because it is a priority for me, like many young black people, to be able to attend graduate schools and achieve the goals that I have set for myself,” said Anthony, who grew up in Mesa, Arizona. “It’s daunting when you think about the potential costs because my family can’t provide much more than I can.”

Rogers also has big aspirations. He took out additional loans last year and started an online master’s degree in public administration. At the same time, he worked as a substitute teacher and DoorDash driver and served as president of the Maryland Youth and College Division for the NAACP. He wants to get into politics and sees education as a kind of national mandate, especially for people like him.

“Education is a tool to improve our communities, and institutions of higher learning have been essential in moving our nation forward,” he said.

With a bachelor’s degree in political science from the University of Salisbury in Maryland, he can’t help but wonder: if lawmakers chose to help the nation’s banks during the 2008 financial crisis, why don’t don’t they think people like him deserve similar investments?

“If you’re able to cancel the debt, you’re going to see a reinvestment in the economy,” he said. “Home ownership. Build credit. Start more families.

The parent trap

Federal PLUS Loans for Parents is a product tailored for trouble, and there’s no sign that will change anytime soon.

This is because parents can borrow up to the cost of their child’s entire education, no matter how much they earn. Additionally, many schools with high costs but low resources send financial aid notices to students telling them to fill their own gaps with tens of thousands of dollars in these loans.

Now imagine you have three kids, are separated from your spouse, and only make $11.50 an hour after spending years raising them. This was the predicament that Reverend Joanna Leiserson found herself in when she was living in Spokane, Washington, in 2000 and her oldest child was about to start college.

PLUS Loans were the only way to pay for the schools that best met the needs of her children. After years of not being able to make payments — she became an Episcopal priest in 2005 — and having debt in indulgence, she’s finally in an income-driven repayment plan and consolidated her $157,000 debt for him. enable enrolling in the Public Service Loan Forgiveness Program. Her debt would be eliminated if she worked another nine years. Otherwise, it could easily be with her until she dies.

“It weighs on me,” she said. “I’m not sure that’s true, but I feel like society will pay if I don’t.”

But any taxpayer subsidy is established public policy, based on laws that Democrats and Republicans have approved over the years. And then there is the question of any higher power that might have an opinion on the matter.

“I believe that God does not weigh in on the details of our debts, but rather wants us as a community to look at the policies and underlying principles and values ​​of our nation and ask ourselves if they align with God’s values,” Leiserson said. . “Which is a community in which all people can live a sustainable life with dignity and respect.”

circa 2023 The New York Times Society

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