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Looking to dig myself out... School me!

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  • Looking to dig myself out... School me!

    First time poster. Looking for some advice before I make any further mistakes.

    Quick summary: I was an international student in the United States and my tuition to a state college here was paid for privately in my home country. During my last semester, a change of circumstances basically left me high and dry and with a $15,000 tab for semester tuition. I had essentially no chance of paying this off, as I was not able to legally work, between visas that allowed me to work. I was able to get odd jobs here and there that were able to pay my rent, food, utilities, but it left literally nothing to pay off any of that debt.

    I didnít think I had a chance to do anything positive about it, so I just never responded to the University, and then any collection agencies. Not by mail or phone. This has been going on since 2015. I have been uncertain until 2018 that I could stay in the United States, so I also did not want to contribute any money to a debt that might be essentially irrelevant to me if I had to move back home to the other side of the world forever.

    In 2018 my situation has changed, and I am now able to legally work and remain in the US. I probably will be here for the rest of my life. Right now I will make between $75-100k this year before taxes. I want to clean any debt off my record, as it has plagued my credit score (though this does not seem to have been a hindrance at all in my life), and I fear that one day I will be taken to court over it. Also I want to no longer fear unknown numbers on my phone. A peace of mind.

    Recently the current company that has the debt contacted me by mail saying they have reviewed my case and are asking if I will do a payment plan of $100 a month. This sounds like a pretty good offer to me, and I would probably make substantial payments above that, and it would also stop collection activity according to the letter. Again the debt is about $15,000.

    Bear in mind I have not ever had a single contact with a debt collector over this debt in the three years I have had it. I know there's like a 7 year limit or something right, but itís an education debt from a public university so it wont go away right? Should I take the $100 per month offer? Or is there a better way? Is it realistic I could get sued for this one day? Could I negotiate terms?

    I tried to keep this short and to the point so if there are more details needed please ask. I am a complete novice at this game and any help or guidance will be appreciated. I want to do the right thing, but I want to do it at least somewhat informed.

  • #2
    Regardless of whether or not you have this debt, you should:
    1. Know where all your money goes.
    2. Live below your means. Don't go clubbing, eat so much fast, take-out & junk food, etc.
    3. Make a monthly budget (not oppressive, just a plan).
    4. Follow the budget.
      restaurant, etc, cell phone game stuff, etc.
    5. Build a cash reserve.
    6. Save for the future.


    Once you do this, you see how much money you have left at the end of the month for debts. (Because $15,000 at $100/month would take 12+ years.)

    BTW, what's the interest rate and current balance on that loan?

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    • #3
      Before you do anything find out exactly who is holding this debt. Offer a settlement, say 50 cents on the dollar, and make sure you get everything in writing.
      Brian

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      • #4
        Originally posted by Dr. Ice View Post
        I will make between $75-100k this year
        I think the first thing you need to do is figure out how much you will actually be earning. There is a huge difference between 75K and 100K. And if you base your budget on 75K but actually make 100K, getting rid of 15K in debt should be a snap.

        The next thing to figure out is your monthly budget. How much are you spending? Even at a 75K income, you should be able to clear up 15K in debt faster than $100/month.
        Steve

        * Despite the high cost of living, it remains very popular.
        * Why should I pay for my daughter's education when she already knows everything?
        * There are no shortcuts to anywhere worth going.

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        • #5
          Hey disney steve,

          Thanks for the response and help.

          The problem is my pay is 100% performance based. Commission only. That $75-100k is a conservative estimate based on what I have done, and what is in the pipeline.

          I do not seem to be gaining any interest on this debt. It appears to be at the exact same monetary number is has been for years. The reason I am posting here is I know it has to be dealt with, I just want to do it the smartest possible way.

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          • #6
            Originally posted by bjl584 View Post
            Before you do anything find out exactly who is holding this debt. Offer a settlement, say 50 cents on the dollar, and make sure you get everything in writing.
            Some collection company out of Illinois I believe. Are you saying I should literally offer half the amount owed, in writing, and see what they say?

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            • #7
              Originally posted by Dr. Ice View Post
              Some collection company out of Illinois I believe. Are you saying I should literally offer half the amount owed, in writing, and see what they say?
              Verbally offer it, and if they say "yes", get their confirmation in writing.

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