On Your Side: Getting out of debt

Investigations

KNOXVILLE, Tenn. (WATE) — For tens of thousands of people with federal student loan debt, they haven’t had to make payments since March when the first coronavirus relief package was passed.

Presently, however, there’s a stalemate in Congress over additional relief for student loan borrowers when bills are scheduled to restart in October.

WATE 6 On Your Side Consumer Reporter Don Dare explains how a Knoxville woman became debt-free with help from a nonprofit organization.

She turned to Operation Hope, partnered with First Horizon Bank; through workshops and one-on-one counseling, financial well-being coaches show hardworking people with moderate incomes, how to take control of their debt by creating a budget.

The single mom we met in March works full time at a local hospital, is now out of debt and in a new home.

Keelah Thompson excitedly showed off her new house to Kristie Blevins, a debt management counselor.

It was the spring of 2019, when Thompson, a single mother of three daughters, first went to Blevins saying she wanted to become a homeowner.

To provide a future for her family, Thompson needed to pay off her student loans first.

“Didn’t think that I could see a breakthrough from my debt. I had thousands and thousands of dollars from student loans from years back. And, then life happens. You get married, you get divorced. I went through breast cancer twice.”

Keelah Thompson

Online ads are full of services to help former students pay off their debt. Thompson contacted a few, but never responded, afraid she’d get further in debt.

“I did let fear become a factor. I didn’t want to call anybody. I’d get letters in the mail from student loans telling me, ‘don’t you want to refinance?'”

Thompson

Admittedly, she needed hope to fight her way to financial security. A cousin told her about Blevins, a financial coach. Thompson visited her office at Operation Hope. Blevins suggested taking a slow deliberate approach of managing debt by watching expenses.

“My budgeting was my main thing because I have girls. Girls are very expensive, they like to get hair, nails and everything done. She said you are going to have to cut back. She said everything that you purchase, try to keep a receipt of it. That really held me accountable because we ate out a lot, you’d be surprised how much money you spend.”

Thompson

Blevins says that once they look at that budget, and we see money left over, the goal will be for them to put money towards debt and put money toward savings.

Thompson’s work plan was to create a livable budget, list her debts, then tackle the lowest debt first and be consistent.

Thompson is thankful for Blevins’ advice, and for managing her get-out-of-debt plan to be like a marathon, not a sprint.

“I’m a living testimony that it can happen. If it can happen for me, it can happen for you.”

Thompson

Blevins says Operation Hope also assists people in raising their credit scores, helping them to build their own businesses, getting out of debt, and buying a home.

Operation Hope and Hop Inside are both located at First Horizon Bank and are available to anybody at no cost.

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