A call from my congressman

I received a call from Congressman Peter Welch’s office today in response to an email that I sent a while back concerning my loan situation.  I appreciated the call and I’m going to remain in touch with the office but the long and short of the conversation is that all they could do was give me the customer advocate numbers for my loan servicers.  Being in student debt is probably the easy type of debt to get into and one of the hardest to get out of.  We all need to get in touch with our representatives and get the laws changed.

Here is a link to a directory for congress
www.contactingthecongress.org/

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What to do with all that free time.

Being unemployed sucks.  Not having a steady income and living off of government subsidies does not feel good.  That being said, it does leave you with a surplus of free time and you can either use that time to finally beat super metroid on your emulator; or you can use that time to learn new skills, reinvest in old hobbies, and fill in the gaps in your interests.

I’ve been using my time to shore up some kitchen skills that I don’t want to lose.  Most professional cooks don’t, for some reason, like to bake.  I’ve always been something of an exception to that rule, so I’ve been using my many days off to practice making my own bread, stock, and pasta.  These particular skills are also great money savers;  I haven’t had to buy bread in quite a while, and, as I improve, I can make much better bread than I could possibly buy for the same price.  Making my own stock is a no brainer to me.  Store bought stock is never very good and costs around five times as much as what I can make at home.  Making stock is also something that every good cook should be doing.  It’s remarkably easy to do and everything that you cook with it will be greatly improved.  Check the end of the post for my recipe for basic white bread.

I have also used my time to learn some new skills, not the least of which is blogging, but along with that, I have taken up knitting, which is a skill that I see a lot of opportunity in.  My girlfriend is an avid and skilled knitter and she has been teaching me the basics.  More men should learn this skill;  for one thing, it gives you something productive to do while watching TV on those many days off.  It is also cost effective and money saving.  I can knit a high quality scarf for slightly less than twenty dollars worth of materials that I would easily pay $50 – 100 for in a store.

The most important thing is to capitalize on the skills that you have during your period of unemployment and make the most of it, especially if jobs are scarce.  You can make a contribution to your household or make your self more comfortable.  Also remember that there is an incredible sense of satisfaction that goes along with making things for yourself.

White Sandwich bread

Preheat oven to 425° before baking

  • 225g – water – luke warm
  • 28g – whole milk
  • 21g – sugar
  • 10g – salt
  • 1 pkg – active dry yeast
  • 565g – bread flour
  • 28g – butter – softened to room temperature
  • 1 ea. – egg
  1. In the bowl of a stand mixer or mixing bowl, add water milk, sugar and yeast.
  2. allow to sit for about 15 minutes so the yeast can bloom
  3. Add egg, flour salt and butter.
  4. mix with a dough hook on low speed for 10 minutes
  5. check the dough by feeling it, it should be just tacky, but not sticky to the touch, if you need to, add a bit of flour at this point.
  6. mix again on medium speed for 4 minutes.
  7. move dough to a oiled bowl to proof (rise) in a warm spot for one hour.
  8. punch the dough down and allow to rise again.
  9. Remove from bowl and shape into a loaf or shape and place in  two loaf pans.
  10. Allow to rise until doubled in size
  11. Bake for 10 minutes, rotate and bake for another 10 minutes.
  12. Enjoy.
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A Quick Word on Time Management

I was reading a post from a fellow debt blogger at debtsucksblog.com and he made an excellent point about time management.  Basically, he says that time budgeting was the wrong approach for him and that keeping a list of priorities worked better.

I have to say that, being a former sous-chef, that I agree.  No matter how busy I was going to be when I got to work, I had to take ten minutes and make a detailed list of things that had to get done and that I was responsible for.  I then had to figure out how to prioritize the list.  What did I have to get done, what could wait, and what could be delegated.  Taking this approach helped me to always be ready for service.

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Bankruptcy – What it means to students

Let me start by saying that bankruptcy is something that should never be rushed into. It has serious repercussions for your credit and the record of it stays with you for a long time. That being said, it can provide a way out of serious debt when other paths are closed. Unless that serious debt is student loan debt. Lawyers.com maintains a list of types of debt that can not be discharged through bankruptcy.

Let’s just examine that list.

  • Taxes and tax liens
  • Alimony and Child Support
  • Debts obtained through fraud, false pretenses or false representation
  • Debts you failed to schedule in time to allow creditors to file proofs of claim (unscheduled debts)
  • Debts for fraud while you were acting in a fiduciary capacity, or for embezzlement or larceny
  • Debts for willful and malicious injury
  • Debts for fines or penalties to governmental units
  • Debts for judgments in wrongful death or personal injury lawsuits resulting from motor vehicle, vessel or aircraft accidents while you were intoxicated
  • Condominium or cooperative association fees or assessments

and

  • Student Loans

Wait. What?

So the entire list is comprised of debts that one incurs  through criminal activity, negligence, and paying for college.  Does that make any sense to any one?  Well, if you have a vested interest in making and collecting those loans then, yes, that makes perfect sense.  Check that list again.  You might notice that student loans are the only loans on the list.  No other type of loan is subject to this provision.

This wasn’t always the case.  The Bankruptcy Reform Act of 1978 included a stipulation that disallowed bankruptcy for student loan debt for five years after the first payment was made.  This was later extended to seven years, and, in 1998, the ability to discharge the debt was removed completely.  Up to this point this only applied to federal student loans, this was amended in 2005 to include private student loans.

In short, the federal government equates student loan debt with criminal behavior, but they aren’t completely to blame.  Major lenders, such as Sallie Mae, benefit from this and have lobbied aggressively to make sure that it is so.  The government has the power to collect these debts in ways that private lenders cannot, so they have no incentive to change the system.

There needs to be a ground level campaign to gets these laws changed.  Fortunately, there are organizations, such as The Project On Student Debt, that are fighting the good fight, and they need all of our support.

Posted in Nuts and Bolts | 2 Comments

Dealing with unemployment – federal vs private loans

I have a number of loans that are serviced by various different agencies and, having recently become unemployed, I have needed to put all of my loans into delayed payment.  For some loans, that means deferment, for others that means forbearance; so what is the difference.

Private loans, that is loans that are not guaranteed by the federal government, have to be put into forbearance, which is an agreement on behalf of the lender to not begin foreclosure proceedings, and in the case of student loans, not allow the borrower to go into default during the time that he/she can not make payments.  Because the loans aren’t insured, this usually means jumping through extra hoops (such as a detailed list of revenues and expenses) that have to be completed and returned through the mail or by fax.  If you are already behind on payments and are receiving calls, you should make every effort to get your loan put into forbearance, but you do not have to give out personal information to unsolicited callers if you are uncomfortable doing so.  I deal with this by simply not answering or refusing to verify my identity, and then immediately calling my loan servicer myself and checking on the status of my account/forbearance request.  Even if you have already mailed your request, it can take days to reach your lender and then several more day to be processed. You may continue to receive calls during this time.

Federally backed loans can be put into a period of deferment, which is simply an agreement to temporarily suspend payments, and tends to be much easier to do.  In some cases, your loan servicer can put your loan into deferment over the phone, though the specific procedure depends on who services your loan.  One thing to know about federal loans and deferment is that if your loans are subsidized then the government will pay the interest during the period of deferment, if your loans are unsubsidized, then interest will continue to accrue and be capitalized at the end of the deferment period.  The way to avoid this is make interest payments on your loans during the period of deferment.

the most important thing to remember is that there are options for dealing with student loans during periods of unemployment and you have to do the legwork to avoid damages to your credit.

Here’s the link to the Dept of Education’s article on payment postponement
http://studentaid.ed.gov/PORTALSWebApp/students/english/difficulty.jsp

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An Email from Senator of Bernie Sanders

I have written to numerous organizations and individuals about my story and what I am trying to accomplish.  This is the page to see the responses that I get.

An Email from Bernie Sanders

I sent my story to all three of my national representatives, so far the only response has come from Senator Bernie Sanders, who took the opportunity to let me know what action is and has been taking place on capital hill related to student financial aid issues.

Dear Mr. Link:

Thank you for contacting me about the difficulty you face with paying your student loans.  All across this nation, millions of people are struggling with their finances and student debt only adds to that struggle. As a member of the Senate Committee on Health, Education, Labor, and Pensions, I appreciate the opportunity to address your concerns on this important issue.

In these tough economic times we must not forget those who struggle to pay their student loan debt. I have worked on many initiatives to reduce the cost of student loans during my tenure in the Senate.  For example, I was a strong proponent of the College Cost Reduction and Access Act. That act expanded Pell Grants, lowered the interest rates for college loans and developed a major new debt forgiveness program.  The act will reduce interest rates to 3.4 percent by 2011, a 50 percent reduction of current rates.  Funds of $6.2 billion will go toward reducing interest rates, of which almost $27 million will go to Vermont students.  The act represented the most significant overhaul in decades in higher education funding and helped ease the financial burden of college education for students and their families in Vermont and all across the country.

As you may be aware, the economic stimulus package included $16 billion in discretionary funds for higher education.  These funds will be used to support the Pell Grant program, the Federal Work-Study program and the Teacher Quality Partnership Program.  These funds will increase the maximum Pell Grant award to $5,350 for the 2010-2011, thus lessening the necessity of taking on large amounts of college loans.  Additionally, the President’s Budget calls for a $2,500 tax credit to help pay tuition costs as well as for the creation of a new Perkins Loan program that will be able to offer cheaper loans than the current program.  The new program, by ending subsidies to financial institutions, will result in savings of over $4 billion dollars that can be reinvested in cheaper student loans and grants.

In addition, we must confront the high cost of college education.  The problem is that over the past years college education costs have consistently been rising faster than inflation.  This has made college education prohibitively expensive for many families.  In today’s struggling economy, we must make investment in education a priority in order to make sure we recover from this crisis as a stronger nation.President Obama as proposed many investments in education during his time in office. I fully support the President’s agenda and look forward to continue working with him and my colleagues in the 111th Congress to make sure that we achieve the President’s goal of having the highest percentage of college graduates in the world by 2020.

Again, thank you for contacting me about this important issue.  Feel free to contact me again in the future about this or any other subject of interest to you, or for up-to-date information on what my office is working on please visit http://www.sanders.senate.gov.  While there, I invite you to sign up for my e-newsletter, the Bernie Buzz, at http://sanders.senate.gov/buzz/.  Please be aware that due to security screening procedures, postal mail to my office experiences delays that will lengthen the time it takes me to get back to you.  The fastest way to contact my office is by calling 1-800-339-9834.

Sincerely,

BERNARD SANDERS
United States Senator

 

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Hello World indeed.

Years ago, a young and clever man decided to get the whole world to help him pay for college.  He accomplished this by getting himself onto a local radio program and requesting all listeners to send him a tiny amount of money each.  Money poured in; some people sent pennies, some sent more, but he was successful.

What does this have to do with anything?  Well, I propose to use the far reach of the internet to do the same thing, albeit in reverse.

I, like many others, recently graduated from college and found myself in deep debt.  My case is a little worse than most in fact.  Because I didn’t know what I wanted to do with my life when I started college, I bounced through a couple of schools before deciding to get my BA in Culinary Arts.  I graduated and found myself $150,000 in debt and working in an industry that doesn’t pay well unless you are extremely lucky.

Which brings me o this blog.  I’m going to cast a wide net into the world and ask everyone for help, but I don’t expect everyone to pony up just to help me out.  For every single dollar that I raise to eliminate my own debt, I’m going to give a dollar to help someone else do the same thing.  I’m going to choose another smart talented college graduate and give them half of whatever I raise to help them get out of their own college debt.

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