What happens now that student loan payments have resumed?
BROOKLINE - Our beloved Bay State. It's home to thousands of college students and graduates. They're well educated, compensated and indebted.
"I believe I owe 13 grand."
"I think 27,000 dollars."
"It was over 250,000."
"I don't even know because it's a very scary number."
That's just a random sampling of the feedback we got when we asked around in the Coolidge Corner neighborhood of Brookline. According to the Education Data Initiative, Massachusetts borrowers owe a combined $30.8 billion, at an average of $34,146 per borrower.
After the Supreme Court struck down the Biden administration's loan forgiveness program, those bills are now coming due, every month. The resumption of payments means money that's gone into people's pockets, and the economy, is now going into those payments. The shuffling of personal finances will force some hard choices.
"It's going to keep me from being able to get a house in the timeline that I think my parents were able to do it," said one person we spoke to.
While the individual hardships are already evident, WBZ TV set out to find out if there could be any macrocosmic effects. Could the economy suffer from the billions of dollars now going to those payments?
"I do foresee there will be some impact in terms of spending in the fourth quarter," said Brian Bethune, an economics professor at Boston College. He's optimistic the payments will not do serious damage to the economy. "The economy is picking up some momentum, so if you're going to do this change, in other words, if there's going to be this potential drag, now's not a bad time to do it. There's no ideal time."
That may be little consolation to many but there is help available.
"If you're finding that your payments are unaffordable, we would strongly encourage you to consider an income-driven repayment plan," said Arwen Thoman, the Massachusetts Student Loans Ombudsman. She said income-driven repayment programs are a great way to lower payments. They are based on income and family size and offer the possibility of loan forgiveness after a certain amount of time. For more information on this program, click here.
Thoman also touted the state's free webinars on loan relief.
"We have three of them. One is about accessing debt relief for public service workers, that's for government, nonprofit workers. We have one that's specifically about accessing debt relief for teachers and one for pretty much everyone else," said Thoman. More information on those topics can be found here and here.
Thoman admits she has received many calls from worried borrowers. Her advice: remain calm, get informed, and take action promptly, because some of these programs are time sensitive and have deadlines.
If you have a question you'd like us to look into, please email questioneverything@cbsboston.com.
