Euro zone likely to reach deal on Greek aid payment

BRUSSELS - Euro zone finance ministers are likely to approve the next tranche of loans to Greece on Tuesday although the money is unlikely to be disbursed before December and a deal on debt reduction may need further talks.

Officials familiar with preparations for the finance ministers' meeting expect a "political endorsement in principle" on unfreezing loans to Athens, after Greece completed almost all the reforms that were required.

"It is clear that Greece has delivered," the chairman of the euro zone finance ministers, Jean-Claude Juncker, told reporters before the meeting.

"We must still reach an understanding on several details and I would expect that the chances are good that we will come to a final and joint solution this evening. But I'm not entirely certain... about the matter," he said.

Hours before the meeting, set to start at 1600 GMT, views on the outcome were still quite far apart among the individual ministers, but a compromise was possible, officials said.
"I hope, I believe and I want to a find a solution tonight," French Finance Minister Pierre Moscovici said in Paris.

But Finnish Finance Minister Jutta Urpilainen was less optimistic.

"I'm not at all sure that it will happen. More information is needed before a decision can be made, so the situation is very much open," she said after briefing parliament in Helsinki.

Greece got a second financing programme from the euro zone and the International Monetary Fund in February, but two subsequent parliamentary elections and a deep depression threw its reforms and fiscal consolidation off course.

Lending was frozen in June and to get it going again Greece had to show it was fully committed to a detailed package of economic reforms or "prior actions".

But the euro zone and the IMF also want to be sure that Greek debt, expected to be almost 190 percent of GDP next year, will fall at some point to a more sustainable 120 percent, so that they will not have to keep financing Athens.

The IMF and the euro zone are at odds on whether to shift the original target date for Greece to do that from 2020 to 2022, torn between the need to retain market confidence and allowing the Greek economy some breathing space.

Reducing the debt

The ministers will also discuss how to reduce debt in a country where the economy is expected to contract for a sixth year running in 2013.

The talks will be based on a debt sustainability analysis prepared by the IMF, the European Commission and the European Central Bank.

Options include halving the interest on existing, bilateral loans to Greece from the current 150 basis points above financing costs, lengthening their maturities, lowering fees charged by the temporary bailout fund EFSF and a debt buy-back.

Germany has floated an idea that Greece could buy back half of its 60 billion euros in bonds remaining in private hands, offering 25 cents per euro.

Euro zone officials have asked for a legal analysis of a debt buy-back and a more operational description for the Tuesday talks. A senior French official said a decision on the buy-back could even be taken on Tuesday.

"It's possible as soon as tonight, it's an option on the menu," the official said.

German Deputy Finance Minister Steffen Kampeter said that if a deal on cutting Greek debt eluded euro zone finance ministers on Tuesday, work would continue this week.

Once a deal is done, proposals on how to cut Greek debt and provide additional financing can be sent to national parliaments for approval, a step expected to be completed by Nov. 30.

This will give Athens time to complete the few outstanding "prior actions". International lenders will check if the remaining reforms are in place on Nov. 28 and euro zone finance ministers will make a final decision to pay the next tranche to Athens on Dec. 3, according to the schedule seen by Reuters.

Greece and the European Commission would then sign a revised memorandum of understanding on Dec. 4 and Greece would get the money on Dec. 5.

Having missed two tranche payments because of the suspension of the programme, Greece should now get a total of 44 billion euros if the next tranche, due in December, is paid out together with the overdue ones.

More than half of that total is cash to recapitalize Greek banks after Greece's debt restructuring hurt their capital base. But some officials said incomplete data on the recapitalization might result in the payout of 31 billion euros, rather than the full 44 billion.

The ministers will also have to decide how to finance two extra years, until 2016, they gave Greece to reach the target of a primary surplus that would allow the country to start cutting its debt pile in a sustainable way.

The troika estimated that such an extension would entail almost 33 billion euros more in financing for Athens, which is politically difficult because of growing opposition to bailouts in many euro zone countries, notably Germany and Finland.

European Central Bank policymaker Joerg Asmussen said on Sunday the euro zone should agree on just two years of funding for Greece and leave further help to be decided later, a view likely to irk the IMF, which wants a permanent solution. — Reuters

source: gmanetwork.com

For dentist with student debt, repaying is like pulling teeth

VACAVILLE, Calif. — His jaw clenched beneath a blue surgeon's mask, Opanin Gyaami jerks his right arm and pulls out a prize: the decayed tooth of patient Larry Butler, also known as state prison inmate J22312.

By the time he is done, Gyaami's smock and mask are spotted with the inmate's blood. He gently pats Butler on the shoulder and wishes him well.

The 71-year-old dentist reports to the state prison in Vacaville day after day, long past retirement age. He wishes he could have hung up his drill and forceps years ago, but he's still paying off a student loan.

After borrowing $50,000 in the 1980s and ignoring payment notices, Gyaami owes more than $500,000 with penalties and interest. The Justice Department took him to court and is seizing $3,000 from his paycheck each month.

Gyaami doesn't expect any sympathy; he knows he's at fault and has added to his problems by falling behind on his income tax. He acknowledges he made some bad decisions along the way.

"I don't want to sound like I'm blaming someone else for my woes," he said. "If you take a loan and don't pay it, you're responsible. It became so overwhelming. I got scared, and it didn't go away."

Student-loan debt in the United States has surpassed $1 trillion. A record number of loans are in default, according to several recent reports, and lawmakers in Washington are pushing for reform to make it easier to discharge some of the debt in bankruptcy.

Although economists' concerns about this debt are typically focused on the young and newly employed, about 2.2 million Americans over age 60 collectively owe more than $43 billion in student loans, according to the Federal Reserve Bank of New York. Many of those loans are in default.

"People think they're kids, but I'd say half the people who come here are over 40, and we have a lot over 60 and some over 70," said Elena Ackel, a senior attorney with Legal Aid Foundation of Los Angeles, which often advises people with student loan debt. "It just doesn't end because of all the fees and everything."


By the time Gyaami graduated from Loma Linda University in 1983 with a degree in dentistry, he had taken out five loans to pay for his education, including $50,000 from the federally guaranteed Health Education Assistance Loan program.

The special loan program, offered from 1978 to 1998, lent $4 billion to 157,000 aspiring doctors, dentists, podiatrists, chiropractors and other health professionals. The Department of Health and Human Services, which oversaw the loan program, reports that 935 of the borrowers are in default, owing $115 million collectively.

After graduation, Gyaami owed about $100,000 and made monthly payments to Loma Linda, none of which was applied to the $50,000 loan. Those payments, he later discovered, should have gone directly to the bank that issued the loan.

When late notices started to arrive, Gyaami ignored them. "There was nothing I could do about it," he said. "I was behind with my business."

Gyaami admits he's better at dentistry than business. He didn't realize how dire the situation had become even after hearing from the Justice Department, which sues borrowers who default on federally insured student loans. Gyaami's $50,000 loan had grown to $195,000 with penalties, interest and fees.

He continued to discard the collection notices. He said he couldn't afford to pay. By June 2010, the $195,000 debt had jumped to $522,214.

The dentist offered to pay $150,000 to settle the suit and close the loan — the money would come from taking a second mortgage against the family's house — but the Justice Department rejected it. A department representative declined to comment on Gyaami's case.

In December 2010, the government reduced the debt to $400,000 and agreed to collect $3,000 a month from his monthly checks, Gyaami said. He thinks it will take more than 10 years to pay it off.

"It's not easy to deal with," Gyaami said. "It looks like I'll have to work until the day I drop off and die."




Born and raised in Ghana, Gyaami was one of 12 children. He studied theology in Nigeria before moving to the United States in 1970. At Andrews University in Michigan, he met his wife, Elizabeth, and they moved to California. He earned a master's degree in public health at Loma Linda University and entered dental school.

Gyaami thought that his dental career would be lucrative and that he wouldn't have trouble paying off his student loans. He opened his practice in Grand Terrace, near San Bernardino.

But he struggled to turn a profit, netting an average $15,000 a year after payroll, rent, supplies and a loan for dental equipment, which was eventually repossessed. Then an employee embezzled about $15,000, which he didn't report to the police.


"She had two children. I couldn't bring myself to prosecute her and let her go to jail," he said.

In 1994, he closed the practice and took a job in the state prison system, first in Blythe and then in Vacaville at the California Medical Facility, where he's worked more than 15 years.

Even though his income increased at the prisons, he still struggled. He and his wife, who worked at the Vacaville prison as a dietitian, put their five children through private schools. Each month they tithed 10% of their income to their church.

He and Elizabeth are devoted members of a Seventh-day Adventist church, where he serves as an elder. "I've been able to get through all of this because of God," he said.

Gyaami treats 30 to 40 prisoners a week, under the watchful eye of uniformed guards. Many of his patients are violent felons serving time for rape, robbery or murder.

As an experienced dentist, Gyaami is among the highest-paid state employees in California, making about $275,000 per year.

"I'm completely broke, even though I make all that money," he said. "The good news is I'm strong enough to practice. And I love doing dentistry, even in the prison."

Since 2008, Gyaami has fallen behind about $120,000 in federal taxes and pays $6,000 a month to the Internal Revenue Service on top of the $3,000 to the Justice Department. His monthly paycheck, after deductions, is barely enough to live on, he said.

Other medical professions have tried to address this problem among its members. The Osteopathic Medical Board of California, for instance, has suspended the licenses of osteopaths who fail to repay their student loans. Donald Krpan, executive director of the board, defends the policy.

"When they don't pay the loan, the federal government comes in and pays the loan. At that point, you and I as taxpayers pay the loan," Krpan said. "It's an aggravation to those of us who borrowed money and paid our loans."

Despite the lingering debt, Gyaami and his wife live a comfortable lifestyle. One year ago they took a two-week cruise in the Caribbean that cost about $4,000, said Gyaami, who called it the most luxurious vacation they had ever taken.

"We forgot about everything and relaxed," Gyaami said, "even though in the back of our heads we knew we were coming back to pay for it."

They live in a 4,000-square-foot home in Vacaville, which Elizabeth purchased new in 2001 for $429,500, according to property records. In 2010, she took efforts to make the home more difficult for creditors to seize by transferring its deed to a corporation she started, Eternal Enterprise Corp.

Gyaami and Elizabeth have been married 41 years. Four of their children are doctors, and each graduated with college debt. He said he hopes they learned from his mistakes.

One of his sons recently negotiated a good deal before he took a new job. His employer paid off his student loans.

source: latimes.com

How Your Course Load Affects College Financial Aid and Student Loan Help

If you are using college financial aid to pay for your education, you need to understand how your course load affects financing. Being approved for loans depends on several factors, including financial need, your performance/progress as a student, your expected family contribution, and the number of credit hours for which you are enrolled. See how your course load will impact your borrowing, whether it’s federal or private.

Course load and federal college financial aid

Your federal college financial aid assumes you will be attending school at least part-time. In fact, some college financial aid is given in direct proportion to the number of credit hours you are taking. The amount of a Federal Pell grant award, for example, is awarded after taking into account your expected family contribution and whether you are enrolled in school full-time, part-time or even less than that. To understand how your specific financial aid package will be affected by altering your enrollment hours, it is best to sit down with your college loan advisor.

Course load and private college loans

Many private lenders will also require you to be enrolled in school at least part-time to be eligible for student loan help. If you are borrowing private student loans, be sure to work with your lender to fully understand the borrowing terms. Carrying too few credits can cause you to become ineligible for private college loans. Additionally, dropping below the part-time status requirement means you’ll have to start repaying your loans sooner than you expected.

Leaving school and college financial aid

If you decide part way through your education to withdraw from classes, you immediately enter the six-month grace period that precedes required payments on your college loans. This is also true if you drop below part-time status. Talk with you financial aid advisor before withdrawing from classes to see how it will impact the student aid package you received. In some cases, you may even have to repay federal grants if you do not complete a required number of credit hours, and scheduled future loan distribution may be impacted.

Be an informed borrower

Even if you have no intention of dropping below full-time status as a student, it’s important to understand the terms of your federal and private college loans in the event that your plans change. Understanding the full obligation of your loans can help you make smarter decisions about your future and maintain a positive credit score.

source: 20smoney.com

Getting a Loan With Bad Credit

In today’s struggling economy, a lot of people have low credit scores and loans are more difficult to get. Your credit score is based on payment history, outstanding debt, credit age, and new credit. To keep your credit score up it is important to pay bills on time and keep your credit card balances low. Your credit score determines how much your can borrow for a loan. If you have bad credit, you can still get a loan, it is just tougher with limited options. Websites like www.badcreditloans.com make it easy for people to get loans regardless of their credit history.




Personal loans are usually considered to be a bad way to borrow money, primarily because of the very high interest rate that comes with them. However, personal loans are a reliable and affordable option for many people, particularly those with limited savings and credit options.

Before taking out a loan it is important to be educated on the loan process. The Bad Credit Loans website has a large selection of resources to help borrowers make the best loan decisions. There are informational articles including tips on when to take out a loan, spending a loan responsible, repaying a loan, budgeting, and more.

In order to be eligible to apply for a personal loan, you must be at least 18 years old, a United States citizen or legal resident, have a steady income of at least $1,000/month after taxes, and have a checking account in your name.

To apply for a loan, you just need to fill out a short application online. Once approved, you will be presented with a number of competitive loan offers from local vendors. Bad Credit Loans has a network of trusted lenders for a variety of loan types including personal, business, mortgage, home, student, and auto loans.

Comparing loans can be quite time consuming, but by using an online service like Bad Credit Loans you will save hours of valuable time by being able to review multiple offers within minutes.

If you decide to take out a loan only borrow what you can afford to pay back, avoid borrowing from more than one lender, repay the loan on time, and set up a realistic budget to help avoid the need to borrow in the future.

Once you decide on a particular loan offer, you are guaranteed to get the money directly deposited into your bank account within no more than one business day. To repay the loan, your lender will withdraw the loan amount, plus any fees and interest charges, directly from the bank account in which the money was deposited on the set repayment date, which is usually your next payday.

There is no fee to apply for a loan on the Bad Credit Loans site and there is no obligation to actually take out a loan. To learn more, go to www.badcreditloans.com.

source: 20smoney.com