Wednesday, August 14, 2013
Todd Ossenfort: Save yourself some student loan repayment pain by understanding the facts surrounding repayment of your student loans.
Student Loans can be a complicated debt that almost all Americans aquire at some time in their life time. College seniors who graduated in 2010 carried an average of $25,250 in student loan debt. That number, according to some industry experts, is higher yet in 2012.
Managing Student Loan Repayment - Todd Ossenfort:
Communicate with your studnet loan lender(s) and find out what options are for repayment.
Government lenders have many different avenues to help consumers repay their student loans. Unfortunately, there may be life situations that occure that cause repayemt to be difficult. When those are obstacles are in the way, communciating with your lender is vitally important to you and your credit.
Don't be one of those consumers that defaults (no payment for nine months), then you will have fewer repayment options.
Private student loans are typically considered in default after missing one payment, but you would need to review your specific contract to learn what repayment options are available from your lender.
Sorry to say, whether you have a government-backed loan or a private loan, both can not be discharge through bankruptcy. You must prove "undue hardship" to be eligible for bankruptcy protection with a student loan. It is very difficult to prove "undue hardship" unless you are physically unable to work and earn an income.
Nevertheless, some other loans have been discharged through bankruptcy when the person can illustrate to the court he or she has insufficient income to pay the loan and that those circumstances are unlikely to change during the repayment period of the loan.
Federal loan grantors have many different collection tools at their disposal. Your federal and state income tax refunds can be seized, your wages can be garnished and you can be prevented from securing a student loan or grant in the future.
You can also search for a better paying job so you can begin to make small monthly payments toward the loan. Or secure a second job. You may even think about borrowing money from a friend or family member to make payments while you are seeking a better job.
Take care of your credit!