Student loan debt is the second most abundant type of debt in the United
States, behind only mortgage loans. In fact, 70 percent of all college
seniors who graduate have some form of student loan debt, with the average
indebted student carrying nearly $29,000 according to 2015 data. And to
make matters even more difficult for many borrowers: most student loan
debt is public, which means it’s almost impossible to reduce without
qualifying for a forgiveness program or unique and exceedingly rare circumstances.
private student loan debt is an entirely separate story. Because these loans come from private lenders,
consumers have a lot more options when it comes to debt relief that they
can pursue. On this blog, we’ll offer a few tips on how to beast
pursue a student loan settlement including giving you a few valuable negotiation
tips to keep in mind.
Expect Pushback from Lenders
Lenders on student loans are likely going to be hesitant to negotiate on
a student loan unless the loan is already in default. If you can avoid
going into default, it’s strongly advised you do so in order to
prevent possible damage to your credit rating. However, for some people,
the benefit of being able to negotiate a better settlement and payoff
plan could be more beneficial in the long run. But keep in mind “strategically
defaulting” like this is risky—you could accrue fees and interest,
and you could wind up being even worse-off after litigation is pursued
However, lenders know that getting something back on a loan that’s
in default is far better than getting nothing back at all, and many are
more willing to negotiate on delinquent loans than you might think. It
might seem intimidating to ask a lender for their settlement options,
but you’ll be surprised just how willing to work with you they could be.
Know Your Rights
Private student loans are significantly different from public ones in that
public lenders such as the U.S. Department of Education have the ability
to go after things like tax returns, Social Security benefits, or other
kinds of federal income in order to satisfy your debt. Private lenders
have no such ability. If a private agency tells you this, they’re
lying to you and you shouldn’t hesitate to lodge a complaint against
them or the collection agency acting on their behalf. It is possible for
them to garner your wages, but they must go to court in order to do so.
The other big difference with privately-funded student loans is that there
is a statute of limitations attached to them. What this means is that
an institution has up to a certain amount of time in order to begin litigation
against you in order to collect the outstanding balance on your loans,
which is six years in the state of New York. Once this six-year period
passes, your lender can’t begin litigation against you, and generally
lenders are going to be much more willing to negotiate and
settle student loans with you.
Work With an Attorney
If you’re facing debt and need to find relief, it’s strongly
advised you speak about your options with either one of our highly reputed
student loan lawyers in New York or our
New Jersey student loan lawyer. Having a legal representative on your side can help you make sure that
your rights are protected and you aren’t victimized by illegal actions
that violate your rights as a borrower.
Get help from a qualified representative by calling the Law Office of Simon Goldenberg, PLLC today at (347) 389-0245!