Meet a dad with 6-figure student debt for his kids' college who Airbnbs his house for an extra $31,000 a year to keep up with payments

• George Botelho owes more than $273,000 in student loan debt that helped his kids go to college.
• He lives in his basement and rents his house on Airbnb to keep up with monthly payments.

George Botelho, 58, said the student loan process "bewilders" him, even though he went to school for economics.

He certainly didn't expect to be on the hook for more than $273,000 in federal loans roughly a decade after both of his kids graduated from college.

"With the income that I made, it was the only way he was gonna go to college," he told Insider about his son, who attended the Berklee College of Music and now works as a music producer. His daughter attended Boston University, and works at a laboratory. Insider verified his debt balance via documents.

Like many students, Botelho's kids weren't eligible for much federal aid, he said, so he emptied $50,000 from his savings account for his son's first year of college. For the rest, Botelho's two children took out loans. Shortly after they graduated, he took the debt under his own name, and consolidated the loans — he didn't want it to negatively impact their credit.

"I think my mistake probably was thinking that I had a handle on this," he said. "I should have done whatever I could to keep it in my kids' names."

Bothelo's loans are through a program called Parent PLUS, which are federal loans parents can use to pay for their children's education. Unlike most kinds of loans, PLUS loan amounts aren't based on someone's income and ability to repay, but instead on the cost of attendance at their child's school, minus financial aid. PLUS loans are the most expensive type of loan, and have the highest interest rate — 7.54% — compared with 4.99% for undergraduate loans, which means that debt accumulates a lot faster for families.

And even though Biden is reportedly considering $10,000 in forgivness for student loan borrowers making under $150,000, it's unclear if parents' PLUS loans will be a part of this plan.

As an excavation contractor who has done work for the Federal Aviation Administration, Botelho was approved for Public Service Loan Forgiveness. This program is meant to forgive eligible borrower's loans after 120 qualifying monthly payments under a qualifying repayment plan while working full-time. But the program has been shown to be flawed, rejecting 98% of all applicants.

Though Botelho hopes he is on the road to forgiveness, he said that between those monthly payments and weekly alimony payments, money is tight for him. This led him to move down to his basement and start renting out his house through Airbnb three years ago.

"It makes it bearable to pay the alimony," he said. "Luckily, I get a lot of repeat customers."

'I fear the next calculation for monthly payment will be the end of me'

Botelho pays $320 a week to his ex-wife in alimony. His monthly, income-based student loan payment is about $970, which he pays to a company called Platinum Debt Service. He owns his own company, and his take-home pay is about $1,600 per week, which makes alimony and student loan bills more than a third of what he makes. He grossed about $31,000 through Airbnb last year, although he said that expenses for repairs and upkeep limit his profits. Insider verified these numbers via documents.

He also said that paying for loans and alimony means that he can't afford a personal car, and is why he ended up living in his basement.

"The temporary hold on student loan payments during COVID was helpful, but I opted out of non-payments very quickly," he said. Because forgiveness is based on hitting 120 monthly payments, he didn't want to prolong his debt further. But those payments are unwieldy.

"I fear the next calculation for monthly payment will be the end of me," he said.

Botelho added that he feels stuck in a federal loan. He does have the option to refinance his loan with a private company at a lower interest rate, but he doesn't want to jeopardize the safety of having a government loan.

"If things go bad, or I start losing work, or I get hurt, I can go into forbearance," he said. Forbearance is a period where you can stop making payments on your government loan without penalty, but in most cases, interest accrues. Private lenders do not always guarantee that you will be able to enter forbearance.

He said that he wishes the federal government would consider at least partial student debt relief for people who make alimony or child support payments.

"I always felt it was my obligation as a parent to provide a college education, as my parents did, for my children," he said. "I accept the burden as a single parent but wished some form of relief will be provided in the Biden's administration student loan forgiveness plan, even if it's in the form of alimony consideration. At least then the income based monthly payment will be based on a 'realistic' determination of what can be afforded by a parent."