FAFSA income-based repayment options with crashed credit score - student loans growing despite paying off debt

I understand your frustration, but there are some things to clarify first. FAFSA is just the application for student aid - your loans are with the Department of Education and serviced by companies like Nelnet, Great Lakes, etc. It sounds like you're on an IDR (Income-Driven Repayment) plan. The new SAVE plan might help you more than your current IDR plan. It caps interest so your balance won't grow even if your payments don't cover all the interest. Have you looked into switching to SAVE? Also, there's Public Service Loan Forgiveness if you work for a government or non-profit employer.

Ugh the same exact thing happened to me!!!! I paid off like $12k in credit card debt but my score keeps dropping because of the student loans. The whole system is RIGGED against us. They want us in debt forever. My cousin just gave up and moved to Europe lol

A few important things to understand: 1) Your credit score drop likely isn't directly from the growing balance, but possibly from missed payments or high utilization ratios. Check your credit report carefully. 2) The SAVE plan (Saving on a Valuable Education) is your best option right now. It's replacing REPAYE and offers better terms, including preventing balance growth from unpaid interest. 3) After 20-25 years of qualifying payments on IDR plans, remaining balances are forgiven (though currently taxable as income). 4) Consider loan consolidation if you have multiple loans to simplify management. You can apply for SAVE at studentaid.gov under the "Loan Repayment" section. Make sure all your income documentation is current.

dont bother with SAVE. its just another gov scam. they PRETEND to help then change rules later. happened with PSLF too where ppl thought loans would be forgiven and then 99% got rejected!!! the whole system is corrupt

I had this same problem last year! What worked for me was getting through to an actual FSA specialist who explained all my options. Regular call center people just read scripts. After MONTHS of trying to call and getting disconnected, I found this service called Claimyr (claimyr.com) that got me connected to a live agent in about 15 minutes instead of waiting on hold for hours. They have a video showing how it works: https://youtu.be/TbC8dZQWYNQ The agent helped me switch to the SAVE plan and explained how to document my income correctly to get the lowest possible payment. My score went up 45 points in the first three months after fixing this!

Something nobody has mentioned yet - check if you qualify for any forgiveness due to school closure, borrower defense to repayment (if your school misled you), or disability discharge. These are separate from the IDR forgiveness programs and could eliminate the debt entirely in specific cases. Also, some employers now offer student loan assistance as a benefit - worth asking your HR about. The SAVE plan also has a special provision for undergraduate loans where payments are only 5% of discretionary income instead of 10%, which could cut your payment in half. Your servicer probably won't volunteer this information unless you specifically ask about it.

I herd Biden canceled all student loans but the supreme court said no. so unfair!!! my friend said they might try again with a different approach but nobody knows when

One more thing to consider - interest rates on federal student loans are fixed for the life of the loan. If you took out loans several years ago when rates were higher, and you now have good income (but not good enough to pay them off quickly), refinancing with a private lender might give you a lower rate. HOWEVER, this is generally not recommended because you permanently lose all federal benefits (forgiveness options, income-driven plans, hardship deferments, etc.). Based on your situation, I'd strongly recommend staying in the federal system and getting on the SAVE plan. Your credit score will recover as you continue making on-time payments and as the loan age increases.