HELP! My Student Loans Are KILLING Me!
If you cannot afford your student loan payments, you first need to realize that you have options. Many people are in the exact same situation.
Here are the steps you need to take now:
Number One: Contact your lender or loan servicer right away. Your servicer is the company that sends you your monthly statements and collects your payments. Tell them that you are having difficultly and that you would like to know what all of your options are.
Number Two: Ask about income-sensitive and graduated repayment options. Income-sensitive repayment takes your income into account and adjusts the payments accordingly. With graduated repayment, your monthly payments will be small and will increase over time.
Number Three: Ask about deferment and forbearance. If you cannot afford to pay any amount, tell your servicer that you are experiencing financial hardship. Student loan providers have financial hardship programs.
Number Four: Consider consolidating your student loans. A consolidation loan can combine your student loans into one new loan with a new interest rate and lower monthly payments.
For federal student loans, visit www.loanconsolidation.ed.gov/ for more information.
For private student loans, ask your loan servicer or search Google for banks that offer private student loan consolidation.
Number Five: IMPORTANT – Whatever you do, do not stop making monthly student loan payments. Until you can figure out a temporary solution, it is important that you continue to make payments. If you stop making payments, your account may become delinquent or fall into default. If this happens, you may no longer be eligible for repayment relief programs and your credit could be damaged for years to come.
Other Student Loan FAQs
Q: My loan was paid by my bankruptcy trustee, or my loans were discharged in bankruptcy. Why am I still being billed for my student loan?
A: If you filed Chapter 7 or Chapter 13 bankruptcy after October 7, 1998, your loan is not dischargeable unless the bankruptcy court finds that repayment would impose undue hardship on you and your dependents.
Q: Can I get some of my student loan cancelled?
A: Several situations might allow you to have your loan cancelled or discharged. For example, certain types of cancellations are available to military personnel, teachers, nurses, and child care providers. To learn whether you meet any of those conditions and to find out what to do next, talk to your lender or student loan servicer.
Q: Can the Department of Education discharge my student loan like HHS did?
A: The provisions for the U.S. Department of Education are different and more stringent than for most other government benefits programs because it involves the one-time elimination of a government debt. For more information regarding cancellation or discharge of your student loan, talk to your lender or student loan servicer.
Q: How can I get my student loans out of default?
A: Fortunately, you have several options for getting your loan out of default. These include loan repayment, loan rehabilitation, loan consolidation, and, if you qualify, payment relief.
Q: How can I postpone my student loan payments?
A: If you have trouble making your student loan payments, contact your loan servicer immediately. You may be able to work out an arrangement in which you can defer or postpone your loan. For more information talk to your lender or student loan servicer.
Q: I am disabled and I believe I should have my student loan discharged or I cannot afford to pay my student loan back. What can I do?
A: Loans can be cancelled, or discharged if you are totally and permanently disabled. There are, however, conditions for eligibility and you will need to provide the necessary documentation. For more information talk to your lender or student loan servicer.
Q: Can I pay less than the amount due on my student loan account?
A: You may want to consider looking into some type of payment relief through graduated payment plans or through income-sensitive payment plans.
Q: I am experiencing a financial hardship. Can I get part of my tax offset back?
A: If the offset of your federal tax refund creates a severe hardship for you, it is possible to request a refund of your offset from your guaranty agency. For examples and additional information, talk to your tax advisor.
Q: I was not old enough to borrow or accept a student loan. Do I still have to pay it back?
A: You may also be eligible to have your loan discharged if you did not meet the physical or legal requirements of your state to enroll in the program or work in the career for which you were training, regardless of whether you had a high-school diploma or General Education Diploma (GED) . To learn more about how to cancel or discharge a loan, talk to your lender or student loan servicer.
Q: I cannot get a job in my chosen field of study. Do I still have to repay my student loan?
A: Student loans cannot be discharged because you feel your institution provided a poor education or had unqualified instructors or inadequate equipment. The U.S. Department of Education does not endorse the school educational programs or guarantee that the school will deliver the services for which a student contracted. Therefore, this discharge cannot be granted if the school did not provide job placement or other services that it promised, or if you were not able to find a job in your field of study. For more information about what does qualify as a condition of loan cancellation or discharge, talk to your lender or student loan servicer.
Q: I signed a promissory note but I did not attend class. Do I still have to repay my student loan?
A: Unfortunately, if you did sign the note then you are responsible for payment. . For more information about what does qualify as a condition of loan cancellation or discharge, talk to your lender or student loan servicer.