• Kjerstin Laine, 30, owes over $110,000 in student debt from undergraduate and graduate programs.
• Laine’s career in the nonprofit sector, in theory, offers a path to forgiveness.
• But interest means she’s barely paid it off, and Biden’s forgiveness is just a drop in the bucket.

Like millions of student-loan borrowers, Kjerstin Laine is in loan-relief limbo.

For Laine, a 30-year-old who has over $110,000 in student debt, the $20,000 in forgiveness she’s set to get from President Joe Biden’s plan is just a drop in the bucket. As a first-generation college student whose debt has shaped the trajectory of her career, she fears her balance will balloon even more after pandemic-era payment pauses end and interest starts accruing again.

“I never miss a payment, always on time, and yet my balances never go down,” Laine told Insider. “I don’t understand how people can’t see that there is something wrong with that picture.”

Despite working through college and taking measures to cut down on the cost, Laine completed her degree in 2014 with a grand total of $98,000 in debt from her undergraduate and graduate studies. In the eight years since, accruing interest has brought her balance to today’s amount, despite her consistent repayment.

Laine chose her job in communications for an education-advocacy nonprofit because it was a good fit for her skills — and because it could set her up for Public Service Loan Forgiveness, which forgives student debt for government and nonprofit workers after 10 years of qualifying payments.

But that program has historically been riddled with flaws, and she recently paused that strategy to take a marketing-agency job with a salary that brings her much closer to the $90,000 the federal government estimated she needed to make a year to afford to pay back her debt. She’s also paying off medical debt.

“I also had to leave the nonprofit sector to get anywhere near that, obviously,” she said. “So it’s like that Catch-22.”

Laine is one of many millions of US borrowers stuck in an untenable situation. She’s grateful for the relief she’s set to get — though the legality of Biden’s forgiveness is still under scrutiny — but she’s not sure she’ll be able to afford monthly payments when they restart in January.

Her situation points to the larger structural issues underpinning the student debt crisis, where first-generation and lower-income students take on huge debt burdens to get ahead and up their earnings but still find themselves buried under ever-growing balances. Many, like Laine, have shaped their lives around the hope of assistance — now that it’s here in some form, it may not be enough.

“The hardest thing is that I trusted in this system that I was told from a very young age was going to be my path to prosperity or a decent — not anything exorbitant — but a decent middle-class life where I could give back to the community that helped raise me and supported me through education programs, meal programs, things like that,” Laine said. “And it feels like that’s a big broken promise now.”

Interest on student loans can balloon, meaning balances don’t go down — and could go up

As a college student in California, Laine worked at several jobs in places like restaurants and grocery stores. She took classes at her local community college and at her university in the summer and winter to try and reduce her expenses. She graduated in 2012, a semester early to cut down on costs, racking up nearly $18,000 in debt total for her undergraduate degree in journalism.

She went on to a “dream school” for a master’s in journalism, still working part time and leaving with an additional $80,000 in debt in 2014. At the end of her time in school, she was hospitalized for dehydration after she said she ran herself ragged.

Despite consistent payments, the years since graduation have seen Laine’s debt grow. It comes down to the issue of interest capitalization, which is when accrued interest tacks on to a borrower’s principal balance and can lead to debt loads being much larger than what was initially borrowed. 

Biden’s administration has taken steps to prevent interest capitalization. In July, it released a proposal to end the practice in every instance that isn’t required under the Higher Education Act, like forbearance periods, but those changes won’t be implemented until next year. And borrowers are still struggling to stay on top of their payments.

For borrowers like Laine, within a few years, interest could cancel out any of Biden’s relief she received.

“I was paying $300 until the pandemic hit. I was paying $300 a month, I think, for three to four years, and my balances never went down,” she said. “They always went up.”

Public servants like Laine can get their debts forgiven — but many can’t even get in touch with their loan servicer

While Laine is a big proponent of public-service loan forgiveness, she said it “has been plagued by its own issues.”

The company that manages the entire Public Service Loan Forgiveness portfolio — MOHELA — isn’t making matters any easier. After a number of loan companies ended their federal contracts last year, all borrowers enrolled in PSLF were transferred over to MOHELA, and the process hasn’t been seamless.

Insider previously spoke with two borrowers who wanted to get simple questions on their PSLF payments answered but ended up spending hours on the phone and never even got connected to a representative who could answer their questions. 

“I’m really concerned about MOHELA as a servicer in total,” Laine said.

Paul Morigi/Getty Images for We, The 45 Million

While MOHELA never commented on the hours-long hold times, Scott Buchanan, the executive director of the Student Loan Servicing Alliance — a group that represents federal loan servicers — previously told Insider that the Education Department decided how many resources it gave loan companies, which affects how many customer-support staff they can hire.

But with the PSLF waiver expiring on Monday, which allows past payments, including those previously deemed ineligible, to count toward forgiveness progress, borrowers are in a time crunch to access the expanded relief. The department recently introduced permanent PSLF fixes for after the waiver’s expiration, but that doesn’t eliminate confusion some borrowers may be experiencing with their payment history.

“I’d love nothing more than to be able to dedicate my entire career to serving this sector,” Laine said. “All of my career choices are kind of centered around this debt, and that’s a really tough, not fun place to be in.”