As soon as Lance Felder wakes up in the spare bedroom of his cousin’s house, he does 100 pushups and 50 situps. The professional football prospect completes the same routine before going to bed at night.
The way he sees it, remaking his body before his first professional football season offers him the best chance to tackle his debt.
Although his eyes are on the field, a $35,000 weight is on the back of his mind. He hasn’t even started repaying his student loans.
Three colleges, one dream
Loan repayment success stories are about happy endings. Half a year after receiving his college diploma, Lance’s not-yet-success story is just beginning.
He started his post-high school academic path at Kingsborough Community College, where his low-income background qualified him for close-to-free tuition. He then attended Bethany College in Kansas to play linebacker for the football team.
“My mother told me I’d have to find a way to pay for school,” he said.
That doesn’t mean she didn’t help, though. Shiretta Felton plastered the front of her Brooklyn, New York, home with posters asking for neighbors to support her son’s trek to college. Dollar raffle entries and donations helped Lance afford books and other school expenses.
Known as the “Gridiron Mom” of Brooklyn’s Bedford-Stuyvesant neighborhood, Felton said she raised $7,000 to help repay friends who’d lent her money for Lance’s expenses.
Felton even negotiated additional scholarship money from one football coach during Lance’s recruitment. Lance eventually landed at Lincoln University in Pennsylvania, where he transitioned from linebacker to tight end.
“The coach kept blowing up my phone, so I told him to talk to her,” Lance remembers. “I was going to training one day, and she said, ‘I got you $3,000!’”
Lance also exhausted every option at each of his college stops. At Lincoln, for example, he earned a $2,000 academic scholarship for maintaining a 3.0 GPA, took out one loan, and received a Pell Grant.
He currently pays $40 per month for a $1,000 school loan. But he hasn’t even begun repaying his estimated $35,000 federal loan debt.
Entering Income-Based Repayment
Lance says he called Great Lakes, his federal loan servicer, to ask about his repayment options. They advised him to switch to Income-Based Repayment (IBR), given his lack of income. He didn’t have a job right out of college and moved twice after a fire destroyed part of his mother’s Brooklyn home.
As with other income-driven repayment plans, Lance’s monthly dues are based on a percentage of his discretionary income. For IBR, it’s 10 to 15 percent.
With little-to-no income to report, however, Lance was told he wouldn’t need to make payments for now. Via a sort of extended grace period, Great Lakes granted him time to focus on increasing his income rather than worry about how to afford minimum monthly payments.
On the downside, Lance realizes IBR is putting off the inevitable and adding interest to the principal balance of his loans. IBR will also keep him in debt longer. It comes with a 25-year repayment term, compared to the standard 10-year term.
If he fails to recertify his income level with his servicer next year, the unpaid interest that grew during this year will capitalize. That would increase the loan’s principal balance well beyond the initial $35,000.
Building income beyond football
Lance says he signed with the Hampton Roads Reapers, a professional indoor football team in Hampton, Virginia. He’s hopeful his current training regimen with one-time Olympic sprinter Julien Dunkley has positioned him to eventually follow in the footsteps of a current NFL player: Cecil Shorts. Shorts is among one of the celebrities that overcame student loan debt.
But Lance also realizes his chances are small. The NCAA estimates that just 1.5 percent of college football players turn pro. His one shot might be impressing scouts at the NFL’s Regional Combine.
To generate an income beyond his day job at his local Dollar Tree, Lance has started working on a side hustle, selling health, beauty, and other products via Amway. The controversial corporation previously led by Betsy DeVos, now the U.S. Secretary of Education, enlists anyone and everyone to independently sell Amway-made products.
Lance says his health services degree gives him a leg up. His online business also fits with his desire to avoid the “nine-to-five, work-until-you-die” life that’s swallowed up those around him.
He’s more optimistic than his girlfriend, who has racked up six figures in student loan debt.
“I’m not stressing about it too much, because [my debt is] not as high as it could have been,” Lance says. “But once the monthly bills start arriving, that might change.”
Anxiously awaiting student loan repayment
Despite his unique professional dream, Lance is not far from the average college graduate. In fact, your typical 2016 college graduate has $37,172 in student loan debt, up 6 percent from the previous year, according to our 2017 student loan statistics.
“Hopefully, by 2019, [I’d like] to be more than halfway done,” he says, when asked about his repayment goals.
Clearly, Lance’s focus is on increasing his income, whether through football or a more traditional career. Although IBR is currently delaying his repayment, he says he looks forward to accelerating repayment. He aspires to be debt free.
How to stay on top of your student debt
If you have student loan debt and are awaiting or just entering repayment, you might count yourself in Lance’s company. Maybe you’re nearing the end of your grace period or deferment.
But it’s time to get serious about how you’ll manage your own student loan repayment.
If you’re not sure where to start, check out our guide to navigating federal repayment programs. The 10-year Standard Repayment Plan you were assigned might or might not be best for you. Explore your options to find out which plan allows you to pay down your debt the fastest while keeping your monthly payments manageable.
Getting that first job after college could be your first step. But no matter the strategy to increase your income, it’s important to keep your student loan situation front of mind as you transition from campus life to the real world. Your happy ending is depending on it.
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1 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Splash Financial loans are available through arrangements with lending partners. Your loan application will be submitted to the lending partner and be evaluated at their sole discretion. For loans where a credit union is the lender, or a purchaser of the loan, in order to refinance your loans, you will need to become a credit union member.
The Splash Student Loan Refinance Program is not offered or endorsed by any college or university. Neither Splash Financial nor the lending partner are affiliated with or endorse any college or university listed on this website.
You should review the benefits of your federal student loan; it may offer specific benefits that a private refinance/consolidation loan may not offer. If you work in the public sector, are in the military or taking advantage of a federal department of relief program, such as income based repayment or public service forgiveness, you may not want to refinance, as these benefits do not transfer to private refinance/consolidation loans.
Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of May 1, 2020.
Fixed APR: Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed Rate options range from 2.88% (without autopay) to 7.27% (without autopay) and will vary based on application terms, level of degree and presence of a co-signer. Rates are subject to change without notice. Fixed rate options without an autopay discount consist of a range from 2.88% per year to 6.21% per year for a 5-year term, 3.40% per year to 6.25% per year for a 7-year term, 3.45% to 5.08% for a 8-year term, 3.89% per year to 6.65% per year for a 10-year term, 4.18% per year to 5.11% per year for a 12-year term, 4.20% per year to 7.05% per year for a 15-year term, or 4.51% per year to 7.27% per year for a 20-year term, with no origination fees. The fixed interest rate will apply until the loan is paid in full (whether before or after default, and whether before or after the scheduled maturity date of the loan).
Variable APR: Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Variable rate options range from 1.99% (with autopay) to 7.10% (without autopay) and will vary based on application terms, level of degree and presence of a co-signer. Our lowest rate option is shown with a 0.25% autopay discount. Our highest rate option does not include an autopay discount. The variable rates are based on the Variable rate index, is based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of April 27, 2020, the one-month LIBOR rate is 0.43763%. The interest rate on a variable rate loan is comprised of an index and margin added together. The margin is a fixed amount (disclosed at the time of your loan application) added each month to the index to determine the next month’s variable rate. Variable rate options without an autopay discount consist of a range from 2.01% per year to 6.30% per year for a 5-year term, 4.00% per year to 6.35% per year for a 7-year term, 2.09% per year to 3.92% per year for a 8-year term, 4.25% per year to 6.40% per year for a 10-year term, 2.67% per year to 4.56% per year for a 12-year term, 3.44% per year to 6.65% per year for a 15-year term, 4.75% per year to 6.93% per year for a 20-year term, or 5.14% per year to 7.10% for a 25-year term, with no origination fees. APR is subject to increase after consummation. Variable interest rates will fluctuate over the term of the borrower’s loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a co-signer. The maximum variable rate may be between 9.00% and 16.00%, depending on loan term. The floor rate may be between 0.54% and 4.21%, depending on loan term. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
All credit products are subject to credit approval.
Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.
As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.
Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.
Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.
Interest Rate: A simple annual rate that is applied to an unpaid balance.
Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of June 23, 2020. Information and rates are subject to change without notice.
3 Important Disclosures for SoFi.
4 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 2.98% APR (with Auto Pay) to 5.79% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.64% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of July 31, 2020, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 7/31/2020. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.
© 2020 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.18% effective July 10, 2020.