Loan discharge may be granted to borrowers who can’t repay their debt due to permanent disability, death or other qualifying events.
Analysts recommend that borrowers do more research for themselves and not rely on the student loan servicing companies to offer the best options.
The student loan crisis is center stage now with a proposed bill that would offer tuition-free college for most Americans while reducing student loan interest rates.
Earlier this week, Education Secretary Betsy DeVos rescinded relatively new federal guidelines meant to make the student loan repayment process more accurate and transparent. There are steps that you can take that may save you from financial ruin.
Student loan debt nationwide is estimated at $1.4 trillion, more than credit cards and auto loans, and second only to home mortgages. “Instead, Great Lakes has violated its duties to Plaintiff and others similarly situated under the Illinois Consumer Fraud and Deceptive Business Practices Act, as well as violating the trust that student loan borrowers placed in the company, by steering struggling student loan borrowers into forbearance, rather than an eligible “income-driven” repayment plan that could have provided monthly payments as low as $0.00 per month, a significant benefit to the struggling student loan borrower, but (potentially) less profitable for Defendants”. Public Service Loan Forgiveness is poised to help borrowers have student loans forgiven after ten years in these careers. These plans are a much better option than late or missing student loan payments.
Projected student loan savings assumed a borrower entering repayment on a 10-year standard repayment schedule.
“In sum, counseling borrowers about alternative student loan payment plans and enrolling those student loan borrowers in income-driven repayment plans is costly for Defendants and its employees”, the complaint says.
“In 2009, we created a private education loan modification program to support borrowers who needed a more affordable payment”.
To help student loan borrowers determine whether relocating would be worth the savings, Student Loan Hero developed a one-of-a-kind State Tax Savings Calculator. The two attorneys general – part of an investigative coalition of 29 states – argue that borrowers deserve to have these tainted private loans forgiven.
The CFPB complaint alleges that employees were encouraged to push borrowers to postpone payments through forbearance. To address the problem, Obama’s education secretary John King wrote three memos to the Federal Student Aid office, making a long list of requests that sought to improve customer service. With this option, the government may pay the interest your loan accrues during the deferment. A majority of borrowers who are in default admit they simply can not afford to make the payments. In some cases, the loans were expected to default at rates as high as 92 percent. You’ll need to ask and some may charge fees to do so.
“Student loans are a constant source of stress and confusion”, said Sarah Hamilton, student loan supervisor for Take Charge America, a national nonprofit credit counseling and student loan counseling agency. After several months of payments, the default can be removed from your credit history, Kantrowitz says. The move is in line with the Trump administration policy of limiting government spending and reducing the burden of paying off loans made by student through the use of taxpayer’s money.
Betsy Mayotte, director of consumer outreach and compliance at the non-profit group American Student Assistance, examines the allegations facing Navient.
And be suspicious of any company touting a so-called “Obama student loan forgiveness program”.