Private v. Federal Student Loans: The Repayment Options Are Much Different
Although federal student loans may be amazingly easy to come by, most rising freshman may investigate other options first with scholarships and grants too, only to find that they cannot completely cover their tuition, or they may not be eligible at all in some cases. The federal student loan usually means jumping through fewer hoops and interest is fixed, rather than variable, making it a much more attractive financial option for students; however, funds are much more limited, and private student loans may be necessary too.
Federal student loans also offer many more realistic repayment programs. Although we all would like to think that we will graduate from college (and we all like to think we will graduate) and find ourselves in the perfect career, with a great income right away, the future does not always work out as planned. The job market can be fierce, shattering illusions of grandeur for millennials who buy into overly optimistic marketing campaigns from colleges.
While it may seem like private loan servicers would want to do everything possible to make sure that young borrowers could pay them back, they are often as rigid as home mortgage lenders. Borrowers of all ages may be left with few options—and defaulting on the private student loan has numerous repercussions, beginning with devastation to the credit report. It can get much worse though if the private student loan servicer sues. Without a reply or a defense, the borrower may find themselves the recipients of a default judgment. Financial difficulties just get worse after that with wage garnishments, freezing of bank accounts, and seizing of property to be sold a public auction.
Have you experienced problems with your loan service provider or student loan program, or are you in danger of defaulting on your student loan? Contact Fitzgerald & Campbell, APLC now so one of our experienced student loan debt attorneys can review your case and discuss all the available options with you. Our attorneys have decades of experience in serving clients as they navigate through challenging financial situations, to include student loan issues, bankruptcy, and other debt management processes. We are here to help! Call us today for a free consultation at (855) 709-5788 or email us at email@example.com.
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