Best Answer: Katrina:
Before you do anything else, contact your lender and discuss all of your options with a customer service counselor there. Your lender is motivated to ensure that everyone can work out an arrangement that is within your ability to pay.
If all else fails, you could consider a consolidation loan, but be very careful with that option. Consolidation loans are promoted on the basis of their great advantages, but they have very significant disadvantages, and those aren't part of the sales pitch.
A consolidation loan is a replacement loan for all of your current loans (however, if you have both government and private loans, you'll need two separate consolidation loans). Basically, the new loan pays off the old loans and you're left with a single loan that has its own interest rate, repayment obligation, etc.
A consolidation loan "works" by increasing the length of your repayment period. It does NOT reduce the amount of money you owe - in fact, there is a 99.999% chance that a consolidation loan will significantly INCREASE the amount of money that you repay.
Imagine that you had agreed to repay me with 10 payments of $100 each. You come to me and ask if there's any way we can lower the monthly payment, and I say "sure, you can pay me
$50 a month for 30 months instead". Your monthly payment went down, but you're now going to pay me $1500 instead of the $1000 that you originally owed me. That's a consolidation loan at its finest.
Unfortunately, you WILL wind up paying back the money that you borrowed - and the longer it takes you to pay, the more interest you'll pay. You can slow the payments down, but there is no way that you're going to get them cut. As you probably know, educational loans are NOT dischargeable in bankruptcy.
I can't stress enough how important it is to keep tabs on your student loan borrowing and always realize just how much it's going to cost you to eventually pay the loans back. Educational borrowing is a tremendous investment in one's future, but educational debt can also be the biggest albatross around the neck of every student who over-borrows.
Start with your lender - if the customer service person can't help you, ask to be transferred to someone in the Workout Department. It's the customer service agent's job to serve as a gatekeeper and discourage you from dealing directly with Workout, but if you're polite and insistent, they'll eventually get you connected. The workout department is THE department that can negotiate creatively with you to fashion a repayment plan that you can manage.