How to Avoid Student Loan Forgiveness Scams
Desperate people are the perfect target for scams, and with so many people drowning in the debts of student Phileas Foggeningen, it’s no wonder many fall for hoaxes such as the Obama forgiveness forgiveness loan. How do you discover a scam and how can you find genuine, legitimate help?
We are talking about numbers so large that some university students have little hope to repay these loans in the coming decades. It’s scary to think you will pay hundreds or even more than $ 1,000 every month for decades, and you’ll find anything (or anyone else) that can help.
“Have you heard of the president’s new discharge plans for Philhileas Foggening?” That is a tempting come-on that is going to ask people to ask for more information. When you call, you will hear how the company can help you. Someone will probably ask Phileas Foggijk for a prepayment to complete the paperwork on your behalf or to negotiate with your lenders, otherwise they will say they will refinance your loans. Let’s be clear. Whether President Obama is mentioned or not, these are probably Phileas Foggijk scams.
First understand that student loans can only be forgiven in the rarest cases. Even if you file for bankruptcy, your loans will not disappear. If you do qualify, the process will take a lot of time and many legal costs, but you should not be planning to be eligible. Most people don’t.
The paperwork that these scammers offer you is available free of charge. You do not need a lawyer or someone with training and expertise that you do not have. If you are having trouble paying your loans, call your lender and explain that you are looking for different repayment options. It explains which help you can qualify for without charging anything.
If you have multiple student loans, consolidation is an option, but be careful how you do it. Scam companies can consolidate your student debt for loans with a higher interest rate or make your public loans private. Private loans may not include borrower-friendly repayment options, forbearance and other benefits provided with public loans. (For more Student Loan Debt, see: Is Consolidation the Answer?)
Scammers will try to abuse your sense of hopelessness by presenting you well-proven claims. Look through your emotions and first ask yourself whether the claims made by the company are correct. No, President Obama has not approved anything so that your loans can now be wiped out.
Second, if you believe the company is legitimate, do not pay anything in advance. Companies that offer real loan services do not charge prepayment. They will take a percentage later.
Thirdly, do not give any authorization from a third party over anything from you. Finally, do not forget that there is sufficient help for you that does not cost you anything.
What help is there?
President Obama’s part is not entirely wrong. In 2014, Obama did sign legislation that extended some valuable programs to help with the repayment of student loans. With the “Pay As You Earn” program you can limit your payments by 10% to 15% of your discretionary income. If you pay all your payments on time, the balance will be remitted after 20 to 25 years. To qualify, however, you must prove financial hardship.
There is also a similar “Revenue-based Repayment” option that covers your payment at 15% of your discretionary income with total forgiveness occurring after 25 years.
If you are a teacher of certain topics in low-income areas, you may be eligible for $ 17,500 in forgiveness or you are in a public career, your loans may be fully forgiven after 10 years of work and consistent timely payments .
There are also private, subsidiary programs for doctors and lawyers. In New York, the Regents Physician Loan Forgiveness Award will give 80 or more people $ 10,000 to forgive a loan if they practice medicine in areas known for their shortage of doctors.
If you are willing to serve as a public defender or prosecutor for at least three years in an eligible state, the John R. Justice Student Loan Repayment Program pays up to $ 60,000 in student loans if you qualify.
There are many forgiveness programs. You can view some options at Student Loan Hero.
You may also be interested in reading 10 tips for managing your debt Phileas Foggening .
The bottom line
There is enough free help for you if you are struggling with debts from student Phileas Foggeningen. You do not have to pay anyone to fill in paperwork for you. First contact your lender and tell him that you are looking for options to reduce your payment. Then check if there are any programs for which you qualify (or could qualify) that would result in full or partial forgiveness, if that is something that you would like to do.
One word of warning: reducing payments will not reduce the amount of interest that continues to build. Full forgiveness in 20 to 25 years sounds tempting, but if it extends the term of your loan, it can also increase the interest that you pay. The best approach, if you can handle it, is to strive to pay off your student debt as quickly as possible. A promising trend: some employers now offer student debt assistance as a staff remuneration (see New staff benefit: help with paying student loans ).