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Borrowing becomes big college lesson

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South Carolina State University Financial Aid Director C.C. Jackson assists Larell Mackey, a junior communication and broadcast major, with his financial aid options.

Ja’Net Adams found herself in a difficult place when she lost her job.

The 2003 South Carolina State University graduate hadn’t worried much about her student loans before then.

“Sixty percent of our household income went away overnight,” she said. “That’s when we got serious about debt.”

Through sheer discipline and hard work, Adams and her husband paid off their $50,000 debt, half of it education debt, in two-and-a-half years.

Others have also felt the pressure of education debt.

America’s education debt has been increasing rapidly over the past decade, and USA Today and reported late in 2015 that it had reached more than $1.2 trillion. According to USA Today, at least 11.5 percent of the debt is seriously delinquent.

Like Adams and her husband, Chadwick Hawkins is looking at a substantial debt of more than $250,000. After earning his bachelor’s degree at S.C. State, Hawkins went on to earn a master’s degree at Walden University. He continued working on his doctorate and kept getting loan after loan.

He says he didn’t realize how the debt was piling up.

Hawkins’ loan payment has been deferred until the fall of 2017, but it’s never far from his mind.

He’s hoping to get some of the loan forgiven because the government offers that option for teachers, and he’s been teaching for 15 years. Locally, he taught at Nix Alternative School from 2011-13.

Hawkins says the state will forgive some $3,000 in state loans, but that’s just a drop in the bucket.

Hawkins has been looking at options for getting forgiveness for the bulk of his federal loans because he continues to work as a teacher. But they won’t forgive the loans until he’s been teaching 20 or 25 years, he said.

He’s also looking at the option of an income-based payment plan, but the government considers his wife’s income too, Hawkins said.

“I don’t want her to have to pay it for me,” he said. “I would love to have it where I don’t have to pay it all back, but right now I just want to have it where I can breathe.”

Ignorance is not bliss

For years, students taking out education loans weren’t really advised or counseled about their responsibilities and the details of their loans.

Sometimes they have a loan and don’t even realize it, Adams said. Her husband went to college on what he thought was a full basketball scholarship, but he ended up owing $25,000 for his freshman year.

Hawkins didn’t find out how high his loans had gone until two years ago, when he and his wife tried to take out a loan to buy a house.

“I always thought I had good credit,” he said. “But when they ran my credit, the guy told me it was just OK.”

That’s when her husband asked for a listing of his debts and found out just how much he owed, Hawkins said. Fortunately, he’d saved enough money for a substantial down payment, so they got their house.

No one gave him any advice or counseling when he was taking out the loans, except his parents, Hawkins said.

“My mother and father would say, ‘All right. You’ve got to pay this back.’

I wish I knew then what I know now,” he said.

Today, he’d tell kids thinking about borrowing money for college to “work on scholarships,” Hawkins said.

Along with rising student debt and default, the U.S. Department of Education and institutions of higher learning are implementing programs to educate students about the loan process and their own responsibilities in paying back loans.

S.C. State requires students to complete entrance counseling on the DOE website before they sign for loans, Financial Aid Director C.C. Jackson said.

“We tell students ‘make sure you read it. Do not be in a race to finish,’” she said. “If you have questions, let us know so we can walk you through the process of understanding.”

The university has required graduates to go through exit counseling for a number of years, but she’s expanding the way it’s done this year, Jackson said. She’s setting up a computer lab where students come in and meet personally with a financial aid professional who can answer any questions they have.

“Graduating seniors will have to come in for a counseling session before they’ll be cleared for graduation – before they can put on that cap and gown,” she said.

Like S.C. State, Orangeburg-Calhoun Technical College requires new student borrowers to complete the online federal entrance counseling, said Kim Huff, vice president of business affairs. All graduates, as well as students who leave school without graduating, are also required to complete exit counseling.

The session introduces students to repayment obligations and options, and what to do if they run into financial difficulty, he said.

OCtech Financial Aid Director Bichevia Green says the college has started a pilot program aimed at advising students about things like different payment options offered by the government.

Pay debt off early

After Adams lost her job, she and her husband decided to pay their debt as quickly as possible even if it meant doing without things they wanted.

“We drew up a dream plan with long, intermediate and long-term dreams,” she said.

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When tempted to spend money, she’d look at the dream plan and ask herself – “Do I want that (dream plan), or do I want a pair of shoes? Do I want that or do I want to go to the beach?

“We didn’t go on vacation. We didn’t go out to eat,” Adams said.

They even cut out cell phones and cable television, she said. “We didn’t do anything for two and a half years, but it was definitely worth it.”

Most people can do the same thing if they’re determined and discipline themselves, Adams said.

“And you have to say no. It’s a small word, but people don’t want to say no,” she said.

People say that they don’t have this or that and can’t pay their loan, but they go to the beach or host a Super Bowl party, she said. They have a new car with a big debt when they could buy a used car.

Use your talents to make money, Adams said. If you bake great cakes, sell them.

“I taught tennis and my husband taught basketball when we were getting out of debt,” she said.

Defaulting on loans

Many people are nowhere near being able to pay off their loans early and many of them are struggling years after graduation.

Jackson urges her students not to get to the point where default is their only option.

It can have severe effects on careers, including preventing people from getting a state or federal job, she said.

“I had my share of student loans,” she said. “If any of my loans ever go into default, then I lose my credential to administrate federal aid.”

The government offers many options for students who can’t meet their loan payments, she said.

Default is not only harmful to individuals, Huff said. If an institution’s default rate is above 30 percent for three consecutive years, it could put the school’s Title IV programs at risk, including Pell and federal work studies.

Jackson says the best way for people not to go into default or get behind on payments is to be knowledgeable and take charge of their loans.

Solving the problem

The first step students or alumni need to take when they have more debt than income is visit, Jackson said.

“That is what I call the nirvana that we use for our federal student loans,” she said. The site has all the information and tools students need to handle their loans.

It tells what kind of loans the students have and how much they owe, she said. It also gives them the option to consolidate loans and select the kind of payment that best fits each budget.

Jackson always advises students to consolidate their loans. Students can end up with several different providers during their years in school and not realize it.

They can be diligent about making a payment, but the money may not go to all their lenders.

Another good reason for consolidation is that people are likely to get a better interest rate, Jackson said.

The interest rates on loans vary and as students get further along in school, they tend to get higher. She’s seen some rates as high as 6.9 percent, but with consolidation, the agency gives them one that’s balanced between the lower and higher rates, Jackson said.

There are also professionals at the website who are very good at helping people with the process, including finding the payment plan that best fits each individual’s budget, Jackson said. This service is free-of charge.

Types of payment plans include a standard plan and several income-based plans, she said.

If you don’t select a plan, your payment reverts to the standard plan and you can have an “absolutely ridiculous” payment, she said.

Many people are unaware of this, but the government also has a loan forgiveness plan for people who going into service work like police work, health service and teaching, Jackson said.

“I emphasize, emphasize, emphasize this: What we want them to do is start that process early. While they are looking for employment, they can consider some position that will offer loan forgiveness for them,” she said.

The government also offers deferment or forbearance of payments for people who meet certain financial hardship conditions.

Be cautious

There are plenty of groups “preying on your desperation,” Adams said. “They’re getting more sophisticated at it.”

Adams said borrowers risk being charged for something they can get for free.

Consolidations and changes in payment plans can be made through the government without charge to the borrower.

Check out the for information on all payment plans, Adams said. When checking out websites about federal loans, stick with the ones that end in .gov. They’re official government websites, Adams said.

Adams has written a book and travels around the country, talking to people about how to get out of debt. Her website is

Contact the writer: or 803-533-5529.


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