Another expat student loan story
Stuff writes about Brad:
This is the situation facing 33-year-old Brad, who did not want to reveal his last name due to the distress it may cause himself and his family.
Brad said he left New Zealand for Melbourne in 2007 due to a lack of employment opportunities, after gaining a Bachelor of Arts with Honours in performing arts.
His loan is now at $108,000, with interest accounting for more than half of the debt.
It’s hard to verify this as we don’t know when he finished studying but if in 2007 you owed $62,000 then in 2016 you would owe around $108,000 if you have made no repayments ever. So only one third would be interest.
Brad said he made an arrears payment of $500 each month, an arrangement made with IRD, but can’t afford the $5000 minimum annual repayment. This means his debt keeps building.
$500 a month exceeds the minimum annual payment so he is complying with IRD and does not need to fear arrest. If he pays $6,000 a year then his interest is $5,724 so his debt should not be building.
The Whanganui-born expat said while he earned $60,000 a year, at least 30 per cent of that went towards living costs.
Which means he has 70% left over. 10% is going on his student loan. He could decide to make that 20% and start reducing the balance.
Brad said his loan had caused him “considerable stress”.
“I have been diagnosed with clinical depression and anxiety; the thought of my crushing student loan debt is constantly on my mind, and there are basically no options I have to remedy the situation.”
Pay back more?
Return to NZ and work here, so you get zero interest on the loan?
While he has been in contact with IRD, constant threats to detain borrowers has made Brad too scared to return to New Zealand most of the time.
“I have returned to New Zealand twice in the last four years and each time I have had to seek anti-anxiety medication from my doctor simply to board my flight, and almost did not return last time, all because of the thought of my loan and being detained at Customs.”
I am sure he is distressed but on the basis of what he is doing (making repayments) he has nothing to worry about.
The borrower said he believed interest should be frozen to help people like him get ahead.
It is – if you live and work in NZ.
“I am supposed to be out here in the world representing New Zealand, promoting it, and instead I feel like I’m being punished for that, and I am deeply resentful of my nationality as a consequence…
No Ambassadors represent NZ. You’re in Australia presumably for reasons of employment of lifestyle. That’s fine, but it means you are not paying tax in NZ or contributing directly to NZ, so you are expected to pay back your student loan.