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$150,000 in Debt for Law School. Now What?

Written by Gary North on July 8, 2012

This was posted recently. The economic stupidity of the person is clear, even to the person who posted it.

As I’ve mentioned before, I graduated from law school over $150,000 in debt. As many of you know, I haven’t exactly paid all of that money back. Not making payments that first year was all my fault. I wanted to get married, didn’t have a credit card, and was using money that should have been going to my loans to finance my wedding.

After that first year, things got a little out of hand. My debt was being sold, the monthly payments were outrageous, and I wasn’t really paying a lot of attention to the situation during the few times when I was both awake and not billing hours. Then I quit my law firm job, hilarity ensued, and I woke up one day with a credit rating below 550.

I’ve been paying the minimum balances to various collection agencies since 2007 or so. Whatever. My hopes for paying it off or owning property pretty much rest on my ability to hit the lotto. Most likely, I’ll die still owing money for law school. And that will be the story of me.

Then the writer added a little humor. I think it’s humor. Maybe not.

A reader emailed us, asking how bad non-payment of law school debt can really be. As one who has walked this path for eight years, I can honestly say it’s not that bad. Sure, it’s a completely different lifestyle than my friends lead. I can’t do “normal” things like get a Discover card or answer my unlisted telephone. But once you get used to it, it’s really not that bad. Your creditors will take away everything they can, but living a paycheck-to-paycheck, judgment-proof existence isn’t as bad as people make it look when they are trying to get you to sign up for a “free” credit reporting service….

He recommends paying off the loans to some credit collection agency at less than 50 cents on the dollar. The trouble is, he does not have $50,000 to pay it off in cash. So he cannot get out from under.

No kidding!

Just don’t gloss over the “low credit score” thing because it really, really sucks. Living with no credit actually means you have to become much better in terms of making a budget. You cannot screw up because you don’t really have a margin for error. Emergency purchases (the worst are when people die suddenly and you have to hop on a bereavement fare on a moment’s notice) can totally throw you without a credit card. And forget doing things like renting cars.

Or owning them, unless you can walk into the dealership and pay straight cash, homey. If you are trying to rent an apartment, be prepared to be rejected out of hand by most places, and only have a shot at a few units if you have two, three, maybe even six months of rent up front, in cash, that you can drop on the landlord or management company. You will not have a doorman.

Conclusion: “If you have a plan for your debts that makes sense to you that you think you can live with, don’t be too afraid to follow it. You don’t need my advice, because you are the one who has to live with your choices. I can live with mine; that’s really all I can tell you.”

If you are in this person’s shoes, visit my free site, www.DeliveranceFromDebt.com.

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One thought on “$150,000 in Debt for Law School. Now What?

  1. Texas Chris says:

    Online college, night classes, CLEP, junior college, no-name schools. Do it on the cheap. Don't do it on credit.