I am currently a sophomore in college paying the interest on my Sallie Mae loan. My loan is cosigned by my grandfather because my dad has horrible credit. Unfortunately, at the time of applying for this loan, my grandfather had already had a hard hit on his credit and the fixed interest rate was 9.75%. Never having applied for a loan before, my grandparents and I decided it would be smartest to choose the fixed rate rather than variable, thinking that there was nowhere to go but up.

Now, we’re struggling with the payments. I recently called Sallie Mae’s customer service line and asked to completely defer my payments until my graduation and they said that, since I already agreed to pay the interest, it would be impossible. I then asked about applying for a lower interest rate but they told me that would also be impossible since I am still in school and not paying the loan in full. I cannot refinance for the same reasons.

What should I do? My dad and I are currently splitting the cost of this payment but, due to his unexpected lay-off, we have hit a dead end. Please let me know if you have any information that could be of assistance to us in our time of need.

Thanks!