When the payments, interest and tight due dates became too much for Steve's son to handle, the father was forced to take over the student loan payments. He had cosigned and didn't want it to go into default, tanking both their credit ratings.
"I had to rethink my whole financial situation," Steve said.
A whopping two-thirds of undergrads now graduate with student loan debt, a total of $1 trillion currently waiting to be paid back.
But will it be?
For the firt time ever, the student loan default rate now exceeds the credit card delinquency rate.
"The amount of debt each year increases, making it much more difficult for students to be able to afford their student loans," said Mark Kantrowitz with the website finaid.org.
And nowadays, if those loans are private, more often than not there's more than one signature on the bottom line.
"That's up from less than half before the credit crisis," Kantrowitz said.
Experts warn it's a recipe for disaster for students and parents.
"Parents are basing their decision to cosign upon the traditional view that when you went to college, your earning power was exponentially greater than if you didn't go to college, and that rationale no longer holds," attorney Ann Margaret Carrozza said.
So what options do you have if your child defaults and you cosigned?
Carrozza suggests you contact the lender immediately and ask for: an interest rate adjustment; a deferment, which gives you a temporary reprieve from the payments where the interest does not accumulate; or a forbearance, which temporarily suspends payments but still allows interest to accumulate.
No matter what, a default can put a lot of stress on a family.
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