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.
Interested in refinancing student loans?Here are the top 8 lenders of 2020!
|Lender||Variable APR||Eligible Degrees|
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1 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 3.20% APR (with Auto Pay) to 6.99% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 6.89% 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 December 13, 2019, 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 12/13/2019. 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@example.com, or call 888-601-2801 for more information on our student loan refinance product.
© 2018 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.
2 Important Disclosures for SoFi.
3 Important Disclosures for Figure.
Figure’s Student Refinance Loan is a private loan. If you refinance federal loans, you forfeit certain flexible repayment options associated with those loans. If you expect to incur financial hardship that would impact your ability to repay, you should consider federal consolidation alternatives.
4 Important Disclosures for College Ave.
College Ave Disclosures
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
1College Ave Refi Education loans are not currently available to residents of Maine.
2All rates shown include autopay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
3$5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees.
4This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
Information advertised valid as of 1/1/2020. Variable interest rates may increase after consummation.
5 Important Disclosures for Laurel Road.
Laurel Road Disclosures
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. Mortgage lending is not offered in Puerto Rico. All loans are provided by KeyBank National Association.
ANNUAL PERCENTAGE RATE (“APR”)
There are no origination fees or prepayment penalties associated with the loan. Lender may assess a late fee if any part of a payment is not received within 15 days of the payment due date. Any late fee assessed shall not exceed 5% of the late payment or $28, whichever is less. A borrower may be charged $20 for any payment (including a check or an electronic payment) that is returned unpaid due to non-sufficient funds (NSF) or a closed account.
For bachelor’s degrees and higher, up to 100% of outstanding private and federal student loans (minimum $5,000) are eligible for refinancing. If you are refinancing greater than $300,000 in student loan debt, Lender may refinance the loans into 2 or more new loans.
ELIGIBILITY & ELIGIBLE LOANS
Borrower, and Co-signer if applicable, must be a U.S. Citizen or Permanent Resident with a valid I-551 card (which must show a minimum of 10 years between “Resident Since” date and “Card Expires” date or has no expiration date); state that they are of at least borrowing age in the state of residence at the time of application; and meet Lender underwriting criteria (including, for example, employment, debt-to-income, disposable income, and credit history requirements).
Graduates may refinance any unsubsidized or subsidized Federal or private student loan that was used exclusively for qualified higher education expenses (as defined in 26 USC Section 221) at an accredited U.S. undergraduate or graduate school. Any federal loans refinanced with Lender are private loans and do not have the same repayment options that federal loan program offers such as Income Based Repayment or Income Contingent Repayment.
All loans must be in grace or repayment status and cannot be in default. Borrower must have graduated or be enrolled in good standing in the final term preceding graduation from an accredited Title IV U.S. school and must be employed, or have an eligible offer of employment. Parents looking to refinance loans taken out on behalf of a child should refer to https://www.laurelroad.com/refinance-student-loans/refinance-parent-plus-loans/ for applicable terms and conditions.
For Associates Degrees: Only associates degrees earned in one of the following are eligible for refinancing: Cardiovascular Technologist (CVT); Dental Hygiene; Diagnostic Medical Sonography; EMT/Paramedics; Nuclear Technician; Nursing; Occupational Therapy Assistant; Pharmacy Technician; Physical Therapy Assistant; Radiation Therapy; Radiologic/MRI Technologist; Respiratory Therapy; or Surgical Technologist. To refinance an Associates degree, a borrower must also either be currently enrolled and in the final term of an associate degree program at a Title IV eligible school with an offer of employment in the same field in which they will receive an eligible associate degree OR have graduated from a school that is Title IV eligible with an eligible associate and have been employed, for a minimum of 12 months, in the same field of study of the associate degree earned.
The interest rate you are offered will depend on your credit profile, income, and total debt payments as well as your choice of fixed or variable and choice of term. For applicants who are currently medical or dental residents, your rate offer may also vary depending on whether you have secured employment for after residency.
The repayment of any refinanced student loan will commence (1) immediately after disbursement by us, or (2) after any grace or in-school deferment period, existing prior to refinancing and/or consolidation with us, has expired.
POSTPONING OR REDUCING PAYMENTS
After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship.
We may agree under certain circumstances to allow a borrower to make $100/month payments for a period of time immediately after loan disbursement if the borrower is employed full-time as an intern, resident, or similar postgraduate trainee at the time of loan disbursement. These payments may not be enough to cover all of the interest that accrues on the loan. Unpaid accrued interest will be added to your loan and monthly payments of principal and interest will begin when the post-graduate training program ends.
We may agree under certain circumstances to allow postponement (deferral) of monthly payments of principal and interest for a period of time immediately following loan disbursement (not to exceed 6 months after the borrower’s graduation with an eligible degree), if the borrower is an eligible student in the borrower’s final term at the time of loan disbursement or graduated less than 6 months before loan disbursement, and has accepted an offer of (or has already begun) full-time employment.
If Lender agrees (in its sole discretion) to postpone or reduce any monthly payment(s) for a period of time, interest on the loan will continue to accrue for each day principal is owed. Although the borrower might not be required to make payments during such a period, the borrower may continue to make payments during such a period. Making payments, or paying some of the interest, will reduce the total amount that will be required to be paid over the life of the loan. Interest not paid during any period when Lender has agreed to postpone or reduce any monthly payment will be added to the principal balance through capitalization (compounding) at the end of such a period, one month before the borrower is required to resume making regular monthly payments.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of November 8, 2019 and is subject to change.
6 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers.
7 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 1.76% effective November 10, 2019.
8 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of 5 years and is reserved for applicants with FICO scores of at least 810.
As of 12/019/2019 student loan refinancing rates range from 1.90% to 8.59% Variable APR with AutoPay and 3.49% to 7.75% Fixed APR with AutoPay.
|1.99% – 6.89%1||Undergrad & Graduate|
|2.31% – 7.36%2||Undergrad & Graduate|
|2.06% – 6.81%3||Undergrad & Graduate|
|2.62% – 6.12%4||Undergrad & Graduate|
|1.99% – 6.65%5||Undergrad & Graduate|
|1.99% – 7.06%6||Undergrad & Graduate|
|1.85% – 6.13%7||Undergrad & Graduate|
|1.90% – 8.59%8||Undergrad & Graduate|