Federal & Private Student Loan Debt: Playing the Blame Game
Finger pointing is an all too common activity for government officials, financial analysts, and student loan borrowers themselves too, when faced with the question of why so many of the 45 million borrowers owing a cumulative total of $1.6 trillion are having a difficult time making payments or avoiding default.
Colleges and universities are taking the brunt of the blame, criticized for rising tuition. Their defense is usually to cite a rise in administrative costs, lack of other types of previous funding, and other continual expenses all leading to educational inflation. For-profit schools usually remain in the line of fire the most though. Online universities are a typical target for blame—and unfortunately, some with good reason for overzealous marketing and promises—and in worse cases, fraudulent behavior.
Sadly, student loan debt in the US has emerged as a crisis—and this perception has in many ways begun to eclipse the true intent of such funding in allowing individuals to gain comprehensive education. A great deal of attention is being paid to the younger generations and how the burden is affecting them—and that a lack of counseling also plays a role in why they get in over their heads. This applies to counseling in the beginning and upon exiting school, mean to ensure that borrowers are aware of the timeline for paying the funds back, to whom, and what their monthly payments will look like.
Once all grants and scholarships have been exhausted (although millions of dollars are usually left un-used each year), federal student loans are usually the next avenue for funding. These loans are often limiting though, then forcing the issue of private student loans. These may not be possible to come by in all cases, however, and may require a co-signer—thus bringing another potential debtor into the fold. Private loan servicers usually offer a variable interest rate which is higher than the federal fixed rate, and in the event of financial distress there is very little flexibility. Not only that, while such loans may stretch the household budget to the breaking point, they can rarely be discharged when filing for bankruptcy—and almost never in Chapter 7.
As finances become even more uncertain today, you may be seeking any relief possible from student loan payments—and especially in the face of diminished income. Although the CARES Act has helped many student loan borrowers at the federal level, if you have a private student loan, work with your attorney from Fitzgerald & Campbell, APLC to negotiate deferments on payments, better interest rates, or perhaps consider refinancing too.
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! Click here to schedule a free 30-minute consultation, call us at (855) 709-5788, or email us at firstname.lastname@example.org.