Avoiding Loans at Any Cost

Recently, community college students in a class taught by Classism Exposed contributor L.A. Kurth (see her note at the bottom of the post) responded to an essay in Yes!* magazine about the student loan debt and the feasibility of a debt strike. Their responses illustrate the loss of opportunity and potential we ensure by offering loans instead of grants or work-study to pay for college. Following is one of those responses by a student who wishes to remain anonymous.

I am a business major with the goal of transferring to a four-year university. I am already in debt outside of school. I owe $20,000 on my car and about $3,000 to $4,000 in credit card debt and other small loans.

Thanks to all that money I owe, I am forced to work a full-time job. I don’t want to stop attending college, so I have to work full-time and go to college part-time.

It will take me forever to graduate. However, my only other option would be to ask for student loans and go into more debt like most other students.

A Greater Cost for Some

Education and success come at a greater cost for many of us. It scares me at times. I often ask myself, What if I graduate and it takes me a while to find a good job? How will I be able to afford making payments on my school loans? The reason why I don’t trust school loans and I’m trying to stay away from them is because I currently have a school loan, and I know how hard it is to repay a high-interest loan. When I was 22, I was working a regular full-time job as a delivery driver for an auto parts company. After working for almost a year, I realized I need to go back to school, find a career and make something of myself. I had no idea what I wanted to major in and knew I would only waste my time if I were to enroll in a community college.

I decided to attend a trade school and get certified as an electrician. The program was only 10 months long, so I knew I would be in and out in no time. Everything was looking very good. There was only one problem: The cost for the electrician program was $15,000. I didn’t want to go in debt, but I wanted to do something. So I took the risk and enrolled, and 10 months later, I graduated, The $15,000 loan turned out to be $18,000 after all fees and taxes. I was able to find a job after I graduated, but since I had no experience, the pay rate wasn’t as good as I thought it would be. A year went by, and I wasn’t too happy with my new profession. So I decided to go back to school.

My previous loan from my other school still terrorizes me. I have a really high interest rate as well as a high monthly payment, and it’s impossible for me to refinance because I am still working on building my credit. I will be stuck with this loan for at least another three years, and it’s no more than $15,000. I can only imagine for how long I would be in debt if I were to ask for loans to fund my remaining three years in college.

When Debt Terrorizes the Mind

Debt does terrorize the minds of people, and as [Yes! writer Yessenia] Funes said, it “cripples nations” – or in my case it crippled and terrorized me. I’m faced with endless school loans. I’m terrified to ask for another one even though getting a loan might be my only option.

The majority of people are afraid of debt because being in debt is like being locked up in chains. You are not free to do what you want. You will have to work at your job whether you like it or not. Why? Because you’re in debt and you need to pay up what you owe.

My parents, brother and I have been living in San Jose since I was 14 years old, and until this day we still don’t own a home. My parents are afraid of such a huge debt. They also don’t have credit cards or car loans. They are too afraid to get into debt and later not have the money to repay what they borrowed.

[gdlr_quote align=”right” ]The majority of people are afraid of debt because being in debt is like being locked up in chains.”[/gdlr_quote]

I envy them at times for being debt-free for the most part. The only problem is that since they don’t have credit cards, they almost never treat themselves to something they want but can’t pay for at once. They also struggle with their vehicles. Since the cars are old, they require maintenance more often than a new car would. Debt most definitely troubles the minds of my parents. They have learned the consequences of debt from some of our family members who are in debt and the majority of their money goes to repaying what they borrowed.

A few politicians recognize the gravity of this situation, but many seem clueless about the lives of the poor or appear to believe (as with housing) that loans instead of lower costs are the answer for the poor.

* Note by Kurth: My heart sank when I read the responses. Very likely, I would have made the same choice and lost the chance to get an education, because I was terrified of debt. My parents never were out of debt and never owned a house. As an undergrad, I lived on $1,100 a year in grants and work-study (and thank God, I didn’t get a loan because when I graduated, I could only find part-time work; that entire summer, my income covered rent, phone and food with about $20 left over per month). It sickens me that because of loans and high interest rates, poor students pay more for college than rich students do. Some of my students are paying 20% interest!