Student Loan Borrower Owes $300,000: 'The System Is Predatory'

One parent who became a student loan borrower now owes more than $300,000 and says he fully expects to work until his 70s before the debt is cleared from his name.

Texan father Tom Krawczyk, age 62, wanted the best for his children, which is why he took on more than $300,000 in Parent PLUS loans so they could attend college.

Parents of dependent undergraduate students can use federal loans called PLUS loans to help pay for college or career school.

His first child to attend college started in 2011 and the last left school in 2021. Over the span of 10 years, Krawczyk has been adding more and more debt to his name so all could gain an education, and now the $300,000 number weighs on his future retirement plans.

"I have a great job with a good income, yet parent loans have destroyed my retirement and positioned me to need to work into my 70s to live," Krawczyk told Newsweek.

Krawczyk is not alone in his plight.

"The interest rates on these loans can really add up, and the limited options for income-driven repayment plans or forgiveness programs leave families in a tough spot," finance expert Michael Ryan, who runs michaelryanmoney.com, previously told Newsweek.

"I've worked with clients who have put retirement on hold or taken on second jobs to cover PLUS loan payments. It's heartbreaking to see such an intense burden placed on parents who simply wished to see their child achieve their dreams."

Earlier this year, nine Congress members sent a letter to Education Secretary Miguel Cardona demanding parent PLUS borrowers get special student loan forgiveness. The lawmakers included Democratic Sens. Chris Van Hollen and Elizabeth Warren and independent Sen. Bernie Sanders.

"We write to you out of deep concern that Parent PLUS borrowers have been left out of key student loan actions the administration has taken," the group wrote in their letter.

Parent PLUS loans already have some of the highest interest rates of all federal loans, which can be difficult for low-income families or even those just looking ahead to their retirement.

When the Board of Education unveiled its new SAVE income-driven repayment plans, offering lower payments and a shorter period for loan forgiveness, parent PLUS borrowers were left entirely out of the program.

Now Krawczyk is hoping lawmakers can take action to address the growing issue of Parent PLUS loans following parents into retirement.

Krawczyk even wrote a letter to his senator, John Cornyn. "Your thoughts are a start but don't go far enough to fix a broken, predatory system, stacked heavily against the middle class," he said in the letter.

While Krawczyk acknowledges he makes a good income, he says the current Free Application for Federal Student Aid (FAFSA) program doesn't take into account his already burdensome $300,000 in Parent PLUS loans.

"In the eyes of FAFSA, my middle-class income makes me rich," Krawczyk said. "The system is predatory. Very simply, if I do not sign for my parent loans, 'my kid is screwed.' No options unless they try to emancipate themselves from us."

Krawczyk said universities play a major part of the problem, consistently increasing costs each year as he says they are "motivated to only get a kid in, keep him in, and keep the money flowing in."

One of Krawczyk's children racked up three years of college classes and debt only to end up leaving education.

"After a year, it was clear he was struggling," Krawczyk said. "The guidance from the counselors, 'Keep trying, it will come. The first two years are the hardest.' Why did we keep him in one more year? Predatory practices and manipulation."

Krawczyk said he was led astray by others' view that only bad parents wouldn't let their children fight through an education they were struggling to make work.

Another of his children was lied to by his university, Krawczyk said. The school marketed its placement program in his chosen industry, but he soon realized only short-term gig jobs were available.

Now Krawczyk is hoping lawmakers can come together to help student loan borrowers, both the students and parents alike.

"There is a student loan crisis," Krawczyk said. "It affects students and parents. There is a college cost crisis. Many students and parents are priced out of college in this current funding system."

Due to Krawczyk's past experience, he says he will not be signing on any more Parent PLUS loans for any of his three remaining children looking to attend college.

"My retirement is hosed," Krawczyk said. "I hope to be able to stay employed into my 70s."

Krawczyk said he never supported President Joe Biden's loan forgiveness plans, as he didn't believe the president had the authority. He also said it benefited those who didn't necessarily struggle to make their payments.

"It was all political theater," Krawczyk said. "Those who became debt-free because of that giveaway...they had no real issue. On a 10-year repayment plan, that monthly payment is small."

Meanwhile, parents who signed onto Parent PLUS loans have been left out of the conversation, Krawczyk said.

"There needs to be relief for students and parents who are victims of the predatory pricing and loan practices of the education system, which includes the government with FAFSA and student parent loans," Krawczyk said. "[...]Universities need to have skin in the game. Bring value to students and share responsibility when kids' plans don't pan out."

If Krawczyk is unable to get any relief in the near future, he looks ahead to his future and he questions whether he will be able to enjoy his last days alive.

"I want a future for my kids and their kids," Krawczyk said. "I'd like to retire at some point with my wife and enjoy our last years on this planet before we go home."