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I was an F-1 student and I graduated with MBA from a top 15 B-school in 2016 and had taken a loan of $85000 (without co-signer). Since my H1B didn't kick in I was forced to quit my job and leave the US. Now I am working for a salary which makes it extremely difficult for me to pay off my student loan (USD/INR exchange rates and international transfer charges).

I feel disappointed with the whole situation, because not getting a visa is not a fault of mine (that damned lottery system). While I had stayed in the US under a valid visa (OPT), I was paying off the loan.

However, now since I don't live and work in the US, I'm finding it impossible to repay. Given the situation, I don't want to go back to the US either. What can happen going forward if I don't repay the loans? Will I be in any kind of trouble?

Thanks.

  • Were you forced into taking a student loan? Could you have gone to work with a bachelors degree? 85K is a massive amount of money, could you have done it for less? There is some personal responsibility you bear in this situation. – Pete B. Aug 14 '17 at 10:24
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    Are the exchange rates and transfer fees so oppressive that you absolutely can't pay back the loan? Or are you making much less money now. With private loans the terms of the loan determine what your options are. There's nothing criminal here so extradition is not a concern but you may not be able to work in the US again without them coming after you (financially). – D Stanley Aug 14 '17 at 13:27
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    I'm surprised as an international student you were able to get that big of a loan. Does your loan have a cosigner who lives in the US? – TTT Aug 14 '17 at 18:34
  • I think it would be very difficult for the lender to enforce anything since you are no longer in the US. Sure, you'll have a bad credit score associated with your US SSN, but any threats from the lender or even an unlikely lawsuit would have no teeth. Unless you still want to live and work in the US, you don't have much downside to not paying it off. Best to check with an expert, though. – Rocky Aug 18 '17 at 21:51
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I would contact your loan servicing company explain the situation and see if you can renegotiate terms. They may be able to drop the interest rate or lengthen the schedule to reduce the payment amount. I wouldn't default on the loan as that would likely hinder coming to/working in the US in the future. Not knowing your financial situation or country, could you attempt to obtain financing in your own country in order to pay off the US based loan? I would at least attempt to make some sort of payment while you attempt renegotiation, refinancing or pursue a job in the US, even if it technically puts or keeps you in default of the loan. Making any payment at least shows the willingness to pay back the loan, and you're not intentionally defaulting on your obligation.

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Its interesting that you are paying back the loan in USD. It is highly unusual for international students to get a loan in US without an American sponsor. I understand it must be very difficult to pay back the american loan without an american salary. Your best bet is to discuss your case with the loan company and they might give you a better deal by waiving off your interest or reducing the principal. However, if you decide not to pay back loan company might file a lawsuit in your absence in US. If you work for a US based company in India they might be able withhold your salary as the company is subject to US laws. Also, it makes sense not to burn all your bridges so to speak.

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I dont know what you decided to do in the end...it would be interesting to know... but I would definetely try to renegotiate leveraging on a possible default position (that will be what Mr Trump would do...). Truth is, there is nothing they can do to you outside of the US and most likely your school, considering your personal situation, would much rather try to renegotiate the loan at much better terms for you (say 15% of your income a month...) rather than selling that debt on 2 cents on the dollar to an international agency that wont probably be able to recover anything, at least on the very near future. This way the school can keep you as an alumn while still making some money of you...with a % of your income, they might hope to still recover the full amount some day if you become somebody...otherwise, they just sold you for pennies today...a horrible write off. Leverage on!

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