Blogging Away Debt Our Journeys to a Debt-Free Life

by Ashley

I recently had the pleasure misfortune to spend several hours on the phone bouncing back and forth between the Department of Education and my student loan servicer, Mohela. I wish I were being hyperbolic or exaggerating when I say “several hours” but, alas, I am not.

To give some background context, I graduated with my PhD in 2013 with six figures worth of student loan debt. I landed my current job, a full-time job eligible for Public Service Loan Forgiveness (PSLF) in July 2015. However, I did not plan or expect to wait ten years to have my loans forgiven. Instead, I set to work with a vengeance trying to pay them off ASAP.

This proved harder than it sounds. Even with paying over $1,000/month, the interest on my loans (most in the 6.5% range) was so large that my payments didn’t even cover the incurring interest. And so my loan balances continued to grow.

When I first graduated in 2013, my entire household income was about $50,000/year (2 adults and 2 children), so those $1,000+/month payments were the max we could do! We were paying more for my student loans than for our housing!

I eventually landed my job, we got raises across time, and I continued to steadily put money toward these debts. When the pandemic hit and interest accrual on student loans was paused? I doubled down on my payments, knocking out individual loans one-by-one.

I wish I could see how much I’ve paid toward these student loans across the past decade (they do not make it easy to determine). I am absolutely confident when I say that I must have paid back well over the original principal balance plus some hefty interest. Does that mean they’re paid off? Nope. I still owe about $25,000. Twelve years after graduating. And ten years after landing my PSLF-eligible job.

Does that mean my loans are about to be forgiven since I’ve now been with my employer for ten years? Also no. Right now the Federal Loan website says my loans are set to be forgiven in October 2026. Why the delay? I’m not really sure. And apparently no one else is either.

I did have 7 months when I had requested forbearance throughout the past decade: 3 months in 2017, and 4 months in 2018. The kicker is that if I’d had a longer period of forbearance, then it would have been forgiven and counted toward PSLF. But I tried everything in my power NOT to go into forbearance and I only used it when I absolutely could not make the payment. And therefore, these periods have not been forgiven (per Dept of Ed: Forbearance can count toward PSLF if it’s 12 or more consecutive months, or 36 or more cumulative months).

So that explains why my “forgiveness” timeline would be delayed by 7 months. But it’s delayed by 15 months. Where are these extra 8 months of delay coming from?

No clue. I called the Department of Education. Waited on hold for literally an hour before speaking to a human. The person said it was between me and the loan servicer. That was it. I called Mohela. Waited on hold, again, for about an hour. And they said it was something I needed to take up with the Department of Ed. Ooof.

I requested a recalculation of my loan payoff date, making sure my employer certification is up-to-date. I’m awaiting those results.

One thing BOTH of these entities suggested though – I could “buy back” some of the time by paying for the loan payments for the months when I’d been in forbearance. That way, I’d hit my 120-months sooner and have my remaining loans forgiven.

This is, apparently, a new(ish?) program they are offering to borrowers.

But is it worth it?

In my case, I think not. I would LOVE nothing more than to be DONE with these student loans once and for all. Just the psychological aspect of not having this debt hang over me would be amazing and I almost considered it for that reason alone.

But financially, it’s not the best move. They calculate the repayment costs based on the average monthly payment at the time the payment was due. Right now my loan payments are much lower because I’d focused on paying off one loan-at-a-time (versus distributing extra payments across all student loans), so even though my interest rates are still the same, I’m paying toward only a remaining couple of loans so my payments are lower. If I were to make payments that were the “average size” from 2017 and 2018? Those would be more like those monstrous $1,000+/month payments I was making way back then.

I’m still crossing my fingers that a recalculation will be completed and they’ll discover I’m actually eligible for forgiveness before October 2026 (though I’m not going to hold my breath!). But even if the forgiveness date remains the same, I’m just going to wait it out and count down until October 2016. I’m finally (almost) in the last year! In some ways it’s easy to be discouraged. I’d originally projected being fully debt-free by the time my girls turned 10. And then by their 13th birthday. Both of those dates have come and gone and I still have this student loan debt hanging around.

Also, it’s hard not to feel bitter or disenchanted that I’ve more than paid these loans back (plus interest) and am STILL saddled by debt. They make it so hard to dig your way out! Not to mention the fact that I tried my hardest to NOT rely on this forgiveness program. When all my friends stopped paying on their loans in 2020, I paid extra, determined to wipe it out! And yet here I am. Still in debt. The great equalizer. Just waiting out my time, like an inmate counting down their days until a projected release date that feels like it keeps getting pushed back for seemingly no reason.

But when I get discouraged, I try some cognitive reframing. All along, I’ve done the best I could do. I can be proud of that (even when it wasn’t always in my own financial best interest). I’m proud of how far I’ve come and for maybe the first time, I can truly see the light at the end of the tunnel. I am ONE YEAR away from forgiveness (fingers crossed), and I will ride things out until then.

Have you tried to “buy back” any months of your payment history to make them qualifying payments for PSLF? Why or why not? What were factors in your consideration?

Ashley

Hi, I’m Ashley! Arizonan on paper, Texan at heart. Lover of running, blogging, and all things cheeeeese. Early 40s, married mother of two, working in academia. Trying to finally (finally!) pay off that ridiculous 6-digit student loan debt!