Two women are on track to rehabilitate student loan debts that are in default*.
Arlington residents learned about a new** loan rehabilitation program for federal loans during an Extension class in March. Extension offered the class, Student Loan Debt Repayment, to affordable housing residents through our partnership with the Arlington Partnership for Affordable Housing (APAH***).
After attending an Extension class, two woman contacted the Department of Education about rehabilitation plans to exit default. One woman’s payment plan was set at $5 per month. Both woman have made consistent payments each month since March. They are on track to exit default after their October 2015 payment.
“It’s really a relief to be able to get this burden taken care of so I’m really excited about it,” said one of the women.
*Default happens when no payments are made for 270 days. The consequences (https://studentaid.ed.gov/sa/repay-loans/default#consequences) of default aren’t pretty. The entire unpaid balance of the loan and interest is immediately due. Debt collectors take over the loan and starting calling. Debts will increase because of late fees, additional interest, court costs, collection fees, attorney’s fees and any other costs associated with the collection process.
**The Department of Education introduced new rules (http://www.washingtonpost.com/business/2014/07/22/e23ee706-11db-11e4-8936-26932bcfd6ed_story.html) in 2014 that enable a borrower to get out of default by making nine consecutive on-time and in-full monthly payments. Borrowers are offered repayments rates based on their income, family size and state of residence.
***APAH serves individuals and families earning between $20,000 and $60,000 per year.
Teen workers are saving for the three Cs: Cars, Computers and College. Plus building emergency funds for unexpected expenses.
This is according to the teenagers who took the First Time Worker Pledge in our new class Making the Most of Your First Paycheck. The class uses materials from America Saves.
Extension has partnered with three groups to provide savings classes for teen workers this year. More than thirty teens pledged to save part of their paycheck. For example, one teen is saving $200 a month for 60 months to buy a $12,000 car. Another is saving $500 a month for six months for school costs.
Bicycling nonprofit Phoenix Bikes has a community bike shop in Arlington and its Earn-A-Bike program teaches bike repair to youth. Master Financial Education Volunteer Will Mason led four Phoenix Bikes employees through the savings orientation. Thank you to Phoenix Bikes’ Executive Director Meg Rapelye-Goguen for making the event happen.
Boys & Girls Clubs of Greater Washington’s Dunbar Alexandria-Olympic Branch in the City of Alexandria provides youth programs and mentoring. At the Dunbar Alexandria-Olympic Branch, 14 teens pledged to save: 11 young men and three young ladies. Thank you to Dunbar staff Alston Waller and Patrice Hall for recruiting participants. Master Financial Education Volunteers Judith Kom and Katrin Kark gave a well-received presentation.
Arlington County Department of Parks and Recreation’s Teen Entrepreneurial Amusement Management (T.E.A.M.) workers manage amusement rentals, including bouncy castles, cotton candy machines and rock climbing walls. Fourteen T.E.A.M. employees pledged to save: nine young men and five young ladies. Thank you to Parks and Rec staff Desi Jerry and Charlie Eby for help setting up the event. Charlie, who worked for the county when he was a teenager, gave a pep talk at the event. Master Financial Education Volunteers Bill Ross and Star Henderson lead the presentation.
Another crop of T.E.A.M. hires will participate in Making the Most of Your First Paycheck later in July. We expect more than 25 teens to pledge to save at this class.