Alex Silva barely managed to pay off his student loans.
“My fiancee is a waitress and she made a good salary,” said Silva.
He holds a master’s degree in accounting and owes over $ 100,000 in undergraduate and graduate loans. Between his work as an accountant and that of his fiancée’s waitress, they were getting along with his parents with their almost 1-year-old daughter.
Towards the end of his graduate studies, he still owed tuition fees at Northeastern University. The school agreed to let him complete his graduate studies with a balance owed. He worked out a payment plan of around $ 400 per month for the next four years.
Silva and his fiancee were able to save between $ 50 and $ 100 per month.
Since Governor Charlie Baker ordered restaurants to go to delivery and take out only, they have to rely solely on Silva’s income plus some unemployment benefits that his fiancée receives.
The federal government has reset the interest rate on students ready to zeroand student borrowers can defer their payments until September.
“It helps,” Silva said. “[It] deals with federal student loans. I think it’s great, but I don’t think that’s the crux of the matter. “
The heart of the matter for Silva is that federal loans are only about a third of what he owes in private loans, and the federal stimulus does not provide any relief from those loans.
He is not sure of the solution.
“You can’t just say it’s not debt anymore,” he said. “A lot of people would lose money, but at the same time it’s very difficult for a lot of people my age.”
Tech entrepreneur Ed Nick Ducoff, co-founder of Boston-based company Edmit, which helps parents negotiate greater financial aid from colleges, said the drop in interest rates on federal college loans to zero would mean that it would be cheaper to go to college.
“There is no doubt that the cost of college education will be lower next year than it was this year, for all schools,” Ducoff said.
Since the ability to pay of students and parents will be considerably weaker, Ducoff predicts that this should put a lot of pressure on colleges to lower prices in the form of increased financial aid.
As the dean of financial services at Northeastern University, Rob Reddy said he hadn’t come across any students saying they were afraid to borrow or didn’t want to borrow.
But he said he and his staff have seen a dramatic increase in the number of families asking for more financial assistance. They had a lot of conversations with parents who feared losing their jobs.
“There’s a lot going on about this,” says Reddy. “I haven’t lost my job yet, but I’m worried. Do I want to make this type of investment?”
Reddy said parents are worried about the stock market crash and that they will have to save more for retirement as a result, leaving less for their children’s college education.
“We are looking to increase the budget for scholarships and grants so that we can continue to be such a generous institution,” said Reddy.
Northeastern caters to all student needs, primarily through grants, but also some loans. Reddy said the university is in a strong financial position to help students and is committed to investing $ 300 million in grants and scholarships.
Lauren Jones Forbes tried to reduce her student loan debt when she graduated with a master’s degree in social work from Boston University this spring. She paid some of the interest while she was still in school, but is not sure if she should continue.
“It would be helpful to have any extra money available at this time,” she said. “But then I think about when you delay payments, how it accumulates, and the interest that keeps building up.”
Jones Forbes had two jobs, but lost one when a nonprofit she worked for fired her.
Her other job is as a home health aide. Even though she no longer meets with her client in order to prevent either of them from being exposed to the coronavirus, she still receives a paycheck for this position.
She also wonders how the job market when she graduates will affect her ability to repay her loans.
“It’s a feeling of uncertainty, just not knowing exactly what’s going to happen, which is the scary part,” Jones Forbes said. “I know social workers are always needed.”
But she is worried about the duration of the pandemic and its economic consequences.
She estimates that she will owe $ 40,000 to $ 42,000 in loans by the time she graduates.
Joseli Alonzo is also pursuing a master’s degree in social work at Boston University.
She is a first generation student. She received her bachelor’s degree from UMass Boston with $ 11,000 in loans. His loans for graduate studies are well over $ 40,000.
Alonzo is also worried about the types of jobs she will be able to get when she graduates this spring. She always wanted to work in hospitals.
“Every day is a different emotion,” she says. “Some days are more like, ‘I can handle this’. Some days I’m more angry and just frustrated and don’t even know who or what I’m mad at. And then some days it’s like I’m facing the humor and laughing at the situation. roller coaster of emotions. “
She lives in her family’s apartment at Field’s Corner in Dorchester. Some of her classmates, she said, have nowhere to live.
“Their priority is finding a place to sleep,” she says, so for them even finding a job, let alone paying off loans, is not the top priority.
“This must be suspended, not only for a few months, but for a while, until the real crisis is under control,” she said.
As Executive Director of Financial Aid at Boston University, Julie Wickstrom begins to respond to incoming student requests for more financial aid than offered by the university.
“We’re just starting to hear students talk about how their situation is changing,” she said. “We have more calls than we usually have at this time of year.”
BU had planned to meet all financial needs for the first time with the new freshman class next fall. Wickstrom said the university intends to honor that pledge.
She and her staff are starting to hear from students whose parents have lost their jobs, and she said BU is willing to increase financial aid. But she said BU has yet to hear from students unable to meet their loan obligations to private lenders.
Correction: An earlier version of this story misspelled Joseli Alonzo’s last name. The story has been updated. We regret the error.
