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3 Bumps

Student Loans...?

My husband has over 50k in school debt that originally (before I was around) they had a verbal agreement to split the debt. Hubby says this is the reason he agreed to it, that his dad pushed him into it. It is basically the only bill that keeps us from being able to make it. What I want to know is if anyone knows what the law states about what his dad is legally responsible for as a cosigner. What happens if we don't pay, do they not care and just go after him? He is not cooperating, it's been 3 years of shame from him and hubby and I work our butts off. the CCs (with his names on most of them) that we owe on amount to the same amount per month (roughly). What's a worse default, and which is easier to lessen? We are working on other avenues too, just looking for someone who knows how to deal with this stuff.

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Anonymous

Asked by Anonymous at 2:34 PM on Jun. 27, 2010 in Money & Work

Answers (7)
  • I don't have an answer for you but I just wanted to say that sucks. :-( Debt is not fun to be in and I hope you can get your FIL to own up to his portion of the loan so that things can be easier for you guys.
    cjsjellybean

    Answer by cjsjellybean at 2:38 PM on Jun. 27, 2010

  • This is a touchy subject and it is a lot of debt, but they can be refinanced if you need smaller payments. Either way your hubby needed the money to get his degree and go to school. If his parents don't have it, the loans needed to be taken out. Here is the problem, if you stop making payments, it will destroy your credit even though his father is a cosigner. It would be much better for you to figure out a way to either delay the payments until later when money straightens out for you, or get the payments smaller. This could really cause some irreversible damage in the family if you don't handle this carefully.
    Lifes-A-Dance

    Answer by Lifes-A-Dance at 2:38 PM on Jun. 27, 2010

  • I feel for the two of you. I have student loan debt also, but mine isnt cosigned. Its all under my name. All I know is that student loans are a nightmare... They do not go away... EVER. I wouldnt imagine it would even be possible to just default on it. It would just be soooo bad on your credit. Talk to a financial advisor.
    mercilove

    Answer by mercilove at 2:38 PM on Jun. 27, 2010

  • If his dad is a cosigner the debt will be referred to him. Your dh will of course have the mark recorded on his credit. Student loans cannot be written off by a bankruptcy. Try this.

    http://studentaid.ed.gov
    itsmesteph11

    Answer by itsmesteph11 at 2:41 PM on Jun. 27, 2010

  • You might want to consider a credit counselling service as a long term solution. If you just need temporary relief, you might want to consider a hardship deferment or other deferment, but that will last anywhere from 6 months to three years and you are limited on how many times you can defer. Moreover, interest is capitalized during the deferment, so it will increase the amount of your debt. You should call your lender if you want a deferment. In addition, you may be able to consolidate the loans and stretch out the term to decrease the monthly payment. You should find a loan consolidation service if you want more information.

    I would be careful about defaulting. It will affect your credit score and that might be a bad idea, given that credit is tightening. As an aside, I don't know the current bankruptcy laws,but I don't think student loans can be discharged in bankruptcy. (Not sure about that)
    ARgal

    Answer by ARgal at 2:46 PM on Jun. 27, 2010

  • Do not let it default! Ultimately the debt is yours and your husband's. His father's credit will be affected as well, so let him know that! That is why they make you take entrance loan counseling and all that- so you can't say you didn't know later on. NOT saying it is right, at all. I think they make it way too easy for young people to become indebted. My SO is one of them, too.

    Here's what you should do:
    Call Student Loans Office and ask about an Income Contingent Repayment, this will let you pay based on your income at the moment. Also, there is a graduated loan plan that will allow you to pay less now and then they will steadily increase every few years.

    Surprisingly, they are usually willing to work with you. Don't let him default! You don't want to trash his and YOUR credit!
    If there is a dire situation in which you just cannot pay you can also ask them about a temporary deferrment until you get things straight again
    LittleWeloosMom

    Answer by LittleWeloosMom at 2:47 PM on Jun. 27, 2010

  • My husband has a credit counselling company and would be happy to help educated you on your options PM me and I'll give you his information. So you can speak with him personally.
    P.johnson

    Answer by P.johnson at 5:15 PM on Jun. 27, 2010

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