Student loans and college/work?

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I currently have 2 student loans in tempoary hardship deferment and I would like to know if either would take the loan out of tempoary hardship:

1. Going back to college
2. Working (currently unemployed)

If yes, please indicate which and what options I might have should the student loans come out of temp. hardship.

Thanks,
Andy...

If you get a job, eventually the loans will come out of hardship deferment because you have income.

If you go back to school, the loans will come out of hardship deferment and go back in to deferment because you are currently in school. They will stay in academic deferment for a year after you leave school again.

One option if you haven't already done it is to have the loans consolidated on an income contingent basis. This is how my student loans are and it gives me tremendous peace of mind. If my income is too low -- say I work at McDonald's or WalMart -- I will have no student loan payments to make. The loan won't be in deferment, I just will owe $0 per month because me income is too low. As my income grows, the payment amount grows accordingly. There is an online calculator on the federal student loan site where you can enter how much you owe and what your income is and it will tell you what your monthly payments are. I played with that calculator a long time and was finally satisfied that my loan payments would never be so high they would destroy my life and that gave me the confidence to return to school.

Another nice thing about the income contingent loan consolidation is that after 25 years (starting with when you leave school or if you're already out of school, starting with when you get the consolidation) whatever you haven't paid off yet is forgiven. Meaning you don't owe it any more. You will have to pay taxes on the amount that is forgiven, but you can either keep a savings account that you regularly put money in for that tax payment or you can negotiate a payment arrangement with the IRS when that tax comes due. If you spent those 25 years not making very much money, you can likely get a tax lawyer to negotiate your payment down to as much as 10% or less based on the fact that you were never able to use that education to get good employment and thus couldn't save up the money for the tax burden, etc.

Another nice thing about any consolidation is that it seriously raises your credit number because the credit bureaus see it as you paying off a huge loan all of the sudden. It doesn't matter that you paid it off with another loan, it raises your credit rating anyway. Be careful because you will get a ton of applications for credit cards after a loan consolidation.