• Lower your monthly payments
  • Reduce stress and live your life
  • Avoid personal bankruptcy court

The Tricks of Student Loan Servicers

Who would have known that the road to student loan is has been made even more difficult because of the secrets and trickery done by the student loan servicers? Yes, it is true—there are things that these student loan servicers are not telling you, and below is a list of those things you may not have known regarding your student loans.

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What Your Student Loan Servicers Don’t Tell You

Here are a few things that your student loan servicers do not tell you unless you ask them.

·         When Your Late Fees Are Added To Your Loans.

Whenever you have a student loan and you are given specific payment requirements, you are expected to meet those payment deadlines or risk having to pay a late fee. However, there are times when your student loan servicer fails to inform you of when the late fees are added. This could be an even bigger problem when late fees start to build on multiple loan accounts. Some companies take a payment on one loan and access it evenly among all of your loans. This is an illegal action, and if your servicer is responsible for doing this without your knowledge, you should report the company.

·         Whether Or Not Your Minimum Payments Are Correct.

Most student loans require you to make a minimum payment each month. However, when you have your loans deferred, your minimum payments could be the wrong amount. If there is a misunderstanding of what your minimum payments should be, it could result in your underpaying causing a late fee to be added to the loan. To prevent this, make sure to understand every aspect of your loan to know what you are required to pay. If you suspect foul play with your student loan servicing company, you should contact them immediately for answers.

·         What Happened To Your Grace Period?

In most cases, lending companies give you a grace period where you are not charged any late fees if you make a payment after the due date. Some grace periods last for 30 days up to 45 or 60 days. If you are not aware of any grace periods with your loan, ask to see if a grace period was included with your loan. If you do have a grace period and discover that late charges were still placed on the loan, contact your student loan servicer to get the charge removed.

·         Tax Information Needed For A Tax Deduction.

When you are paying back student loans, you are eligible to receive tax deductions on the interest you are paying back also. Some student loan servicers do not inform you of this or provide you with the documentation to be able to do that. It is important to understand that you are entitled to this information and should be given it automatically. With this tax deduction, students can receive up to $2,500 in funds.

·         How Bankruptcy Affects Your Student Loans.

If you have student loans and need to file for bankruptcy, you should understand that no student loan is erased when you file bankruptcy unless you show proof of an extreme hardship that prevents you from being able to repay your loans. Some student loan servicers may tell you that student loans cannot be erased in bankruptcy. In some cases, you can get is taken away.

·         Being Protected From Creditors.

Student loan servicers typically assume the role of creditors when student loans become past due. However, just like all other creditors, there are legal limits that must be set when informing borrowers of what they owe. Creditors are not supposed to contact borrowers during a certain time of the day and for a set number of times each month. It is important that you know your rights to not be harassed by any creditors and exercise those rights if you ever need to do so.

What You Can Do

Your student loans are definitely something that should be taken seriously. After all, this may be the first loans that are in your name, so you must take of them in order to keep your credit in good standings. Depending on the types of loans that you have, there are different times you will be required to start paying back the loans. You want to make sure you are ready to take on the challenge of repaying your student loan debts. For further information on any student loans that you may have, consult the Federal Student Aid website, and you should be able to find the answers to any questions you may have.

Student loans can be a hassle to handle, and your student loan servicers may be there to help you handle them, or can hurt you by not telling you certain things that you should know. When you are ready to repay your loans, look at this list to remind of what your servicers will not tell you.

4 Things Parents Must Keep In Mind About Student Loans

Every year has seen tuition costs for college and university rise – the average cost of private intuitions of higher education reached as high as $40,000 in 2013 and 2014, and the cost will only go up as time goes on. The increase is estimated at around 3%-4% every year, outpacing wage growth and inflation – which means that many families don’t have a choice but to take out student loans in order to make up all of the costs.

If you’re a parent sending your child to an institution of higher learning and you’re looking at taking out student loans, it’s important for you to know the ins and the outs of the college loan system – you don’t want to be caught off guard, so you should know about student loans.

Know About Student Loans

As A Co-Signer, You Are Always Responsible to Know About Student Loans

Some recent stories of parents co-signing for student loans have attracted some media attention – and one such story is that of the Mason family. The parents of Lisa Mason co-signed for nearly $100,000 of student loans to cover the cost of nursing school – and then tragedy struck. Lisa Mason died of liver failure at 27 years old, and the Mason parents were suddenly targets of lenders looking for repayment of the loans regardless of the tragedy. Because the Masons didn’t know about student loans, they suffered afterward.

While some of the lenders reduced their interest rates in light of the media attention the story found, a lot of people still don’t quite realize how dangerous co-signing can be. They’re liable, no matter what happens to the student – and even if the student remains in good health, the co-signer will be on the list when the time comes to pay.

Who Borrows the Money Is Important To Remember

When it comes to financial aid the calculations assume the burden of paying the loans is settled on two groups – the student and also the parents will make contributions to paying off the debt, and both are taken into account when it comes to the type of financial aid that can appear. Just like co-signing for private loans, it’s important to be accurate with who’s borrowing what for federal loans.

This flexibility can get you some better terms when it comes to interest rates and repayment. PLUS loans for parents can see fixed interest rates and delayed repayments when needed – but you need to ask yourself if you, as a parent, can repay the loans in worst-case scenarios. The more debt you take in your name, the more trouble you might have if things don’t play out well – just another thing that’s important to know about student loans.

Learn About Forgiveness Terms

The terms of forgiveness – if you have to pay back the loans – depends on what the type of loan is. Federal loans generally have a generous or kind set f forgiveness terms. Tragedies can see the loans forgiven so that you don’t have to pay back, if your child takes a public-service job (like teaching) it can forgive the loans over time, and if the school closes down for foreclosure it can result in you not having to pay the loans back.

Private loans, on the other hand, are much stricter. Lenders vary from one to the next on how they offer forgiveness terms if they do – and while they will take into mind how likely it is they’ll be paid back over a shorter or longer period of time (which can work out for you if you tell them, and get you on income-based repayment or a longer period to pay everything back), not many will give you outright forgiveness. Federal loans are better for you than private loans – but they can’t cover everything. If you have to take a private loan, make sure you know about student loans and every last detail of the loan contract and try to keep it in mind at all times when dealing with paying back your loans.

No Debt Is the Best Kind of Debt

It’s obvious – you’d rather have no loans to repay than some loans. It’s loan debt, and it can stack up from interest or generally hurt your credit score as time goes on. There’s a few ways to push toward this kind of goal, and one of them is to (while your child is still young – start as soon as you can) set up a college education fund near the start of the process and let it build up over time. Even a small amount every year can cut back the amount of tuition you will have to pay and make sure you have an easier time paying the loans back.

Just because you know about student loans it doesn’t mean you will have an easy time paying everything off – but being informed on exactly what each loan means can help you in the future of a tragedy or setback occurs and make sure you avoid the financial ruin that can from defaulted student loans.