CNBC reported today that more than 1.1 million borrowers defaulted on their federal student loans last year. If you have been struggling to pay your student loans, you are not alone. According to a Consumer Federation of America analysis of U.S. Department of Education data, the number of people who have defaulted on their federal student loans increased 17 percent from 2015 to 2016. If you haven’t paid your student loan in 270 days, then you are officially in default. What do you do if you default on your student loans? Whether you have federal student loans or private student loans in default, you DO have options.
What To Do If You Default On Student Loans
What To Do If You Default On Federal Student Loans
The federal government is working hard to find ways to help students with their debt relief. There are already a number of loan rehab programs for federal student loans, such as a federal student loan debt settlement, a federal student loan rehabilitation plan, and income based repayment plans. If you default on your federal student loan there is help out there.
For example, our client received notice that her wages would be garnished due to her federal student loans being in default. Her income was $15,000 per year and she owed approximately $16,350 on her federal student loan. We got our client into ECMC’s loan rehabilitation program. Under her plan in the program, our client only had to pay $5 per month for the next 9 months. After those payments were made, the negative reporting from her credit report was removed and she was able to then become eligible for all federal student loan repayment options including forbearances, deferments, and income-based repayment plans.
What To Do If You Default On Private Student Loans
Whether you have defaulted on private student loan debt with Navient, National Collegiate Student Loan Trust, Wells Fargo or any other lender; there is a way for you to get out of default. Private student loan debt is not unlike credit card debt. If you default, the lender will come after you with their vast resources. You could be facing a student loan debt lawsuit, wage garnishment or bank levy. I have successfully negotiated many debt settlements for clients who have defaulted on private student loans.
Debt Settlement Option If You Default On Student Loans
Debt settlement to get out of student loan default may be your best option. I have had much success helping my clients to get out of student loan default with a debt settlement. In a debt settlement a negotiation is made between the student loan borrower and the lender (bank) for the borrower to pay back only a portion of the overall debt in a lump sum or in a payment plan. For instance, our client owed National Collegiate Student Loan Trust over $35,000 on her private student loan that had gone into default. In a short amount of time, I negotiated a debt settlement and we were able to cut her overall debt amount to $17,454.69 payable over 84 months. We got her monthly payments down to a reasonable and interest free $213.78 per month.
I have many examples of student loan debt relief success stories on my website. If you find yourself wondering what to do if you default on your student getting sued over student loan debt, you need to arm yourself with information regarding all of your options. I am available for a a free debt consultation at 858-217-5051 to go over your debt relief options. Picking up the phone can be a hard first step, so feel free to ask me any debt question on my “Ask a Debt Relief Attorney” page. My website also offers student loan debt resources such our eBook The Ultimate Guide to Student Loan Debt Settlement and links to my debt relief YouTube channel.
Daniel R. Gamez, an attorney focusing exclusively in debt relief, is licensed to practice in all state and federal courts in California and Texas. Mr. Gamez owns and operates the Gamez Law Firm in San Diego, CA. For more information, please contact Daniel Gamez at 858-217-5051, firstname.lastname@example.org or use our online contact form. Stay updated with the latest debt relief tips by following on Facebook and Twitter!