Private Student Loans – You May Pay Dearly Later
As school approaches, there is usually an overwhelming amount of tasks to take care of, but for the rising student, much of it is more exciting than anything else, even if it might be somewhat daunting to figure out scholarships and grants and private student loans—not to mention which school to attend, whether to stay in a dorm or an apartment, or whether to live at home, and a multitude of other choices. The list of things to do and the choices may seem to stretch on into eternity but without the acceptance letter, and without a check for tuition, not much will happen.
The student loan business (although yes, many borrowers may be in a crisis around the US as the cumulative total rises to $1.6 trillion) is a booming industry as private loan servicers continue to dole out millions of dollars each year. Student loans may be considered part of the equation when it comes to going to school, but some students may not consider that a private student loan could be hard to attain.
Most college freshmen do not have a solid financial background for a lender to examine or consider, because of course they may have never made a large purchase such as a car or a home, and they may not yet even own a credit card to use to build up credit. While they may be able to take on a loan at a much higher interest rate, in these cases a co-signer will almost always be required. For some, these loans are easy to pay off, but for others, the student loan becomes a nightmarish burden; in fact, it may overtake the household budget, even driving an individual or young family into bankruptcy very early on.
Later, there is always the question of whether or not the college degree is going to pan out with the type of income that was expected or possibly even promised by an overzealous college. Even with a great new career going, a new borrower may have trouble bringing in substantial enough amounts of money at first to pay back a student loan debt with ease. While federal loans may be difficult to pay back also, there are myriad alternative repayment options, sometimes even including forgiveness and cancellation.
Private student loans are an entirely different animal though when it comes to delinquencies or a default. While there may not be an actual object to take back, these lenders can be as aggressive as mortgage companies or auto financers in pursuing you to satisfy the debt. This could include suing you, and a collection lawsuit for a private student loan that is not dealt with correctly can easily turn into a default judgment. This escalates into wage garnishment, loss of control over financial accounts, and seizure of property, and the situation becomes even more difficult if the loan servicer ends up going after the cosigner.
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 firstname.lastname@example.org.
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Posted in: Student Loan Debt