Hi Stanford Community!
I’m considering defaulting on my student debt from Stanford, which is over $200,000.

I’m an alumni from both Stanford undergrad and grad school. I’ve been making payments for years and never defaulted. Yet, my income now is not enough to support continued student debt repayments:

• Not being able to afford rent in the Bay Area is now becoming a possibility for me. It doesn’t seem to make sense to allow student debt to drive me faster into homelessness.
• I’ve already maxed out on Forbearance time allowed.
• My Forbearance requests now to the private banks have been rejected, which seems to be permanent.
• Enrolling in community college classes to get deferment is no longer working for the private bank student debt.
• Stanford Financial Aid Office doesn’t seem to be able to help, since the debt is to private banks. Stanford seems to have no power to inhibit the banks from coming for me and even calling my parents.
• I’m almost certainly headed to student debt default unless I start paying the student debt with credit cards, which doesn’t seem to make sense. Credit cards have an 18% interest rate, while the student debt is about 6% interest rate.

My Questions for You:

• Do you have any advice for me about dealing with student debt default?
• Have you ever defaulted? What are the downsides of defaulting?
• Can defaulting on student debt cause someone to go to jail? If not, why do people bear the burden to actually pay all that back plus interest?
• Is the only reason to actually pay all that student debt back a moral obligation, or are there other reasons I’d need to pay?
• Will my credit score drop because of a student loan default? Does that even matter given that there’s no way I could afford a mortgage or house in the Bay Area?
• What tools and teeth do the private banks have in pressuring me or threatening me when they try to get the student debt money from me?