Student loans affect millions of Americans, many of whom struggle to make their payments every month. Besides income-based repayment University Of Phoenix Loan Forgiveness options and refinancing, there are few options for those barely squeezing by. However, one that is rarely discussed, but still applies to some borrowers, is student loan discharge.
Discharging student loans is still a fuzzy concept for many. It sounds like it’s too good to be true, but it can be a reality for those who qualify. It’s a complicated process and might require the help of a lawyer or someone with direct experience. In fact, the Department of Education just clarified the rules last month to help borrowers understand how this process works.
Read below to see if you qualify and what you need to be able to discharge your University Of Phoenix Loan Forgiveness.
Note: Sadly, the current Trump administration has paused many Borrower Defense To Repayment applications. There are several lawsuits going on to challenge this, but most of these are on hold. You can still apply, but don’t expect to get a response soon. As such, make sure you’re taking appropriate action on your student loans now.
Borrower defense to repayment involves proving that the university or college deceived University Of Phoenix Loan Forgiveness in some way that involved them taking out student loans. If a university defrauded a student in a manner that led to the student taking out student loans, he or she may be a good candidate to have their loans discharged.
Only Direct Loans are eligible for discharge for fraud, so graduates with Perkins, unsubsidized Stafford, Parent PLUS, Stafford or Federal Consolidation loans aren’t able to discharge their loans.
Student loan lawyer Jay Fleischman said successful discharge “can lead to not only a forgiveness of the unpaid balance, University Of Phoenix Loan Forgiveness but also reimbursement for any money you’ve previously paid and removal of any negative information on your credit report related to the loan.”
Students who want to discharge their loans must send some required information to the Department of Education, including:
More details on what you need to file a claim can be found here. After the claim has been submitted, the loans will go into deferment for up to 12 months where they will still accrue interest.
The process to discharge your loans is a serious legal matter, and you may need extra help to go through it.
“You’ll need to prove to the government not only that your claim meets the state standard, but also that the statute of limitations for bringing such University Of Phoenix Loan Forgiveness a claims have not expired,” Fleischman said. “You’ll also want to understand the implications of a discharge of your federal student loans on your taxes, and whether you may be taxed on the forgiven debt.”
Whenever you get help for your student loan debt, make sure you fully understand and research the options for yourself. Nobody will care more about your situation and your money than you.
Getting private loans discharged is much more difficult. Every loan provider has a different policy, so contact your individual provider to see what theirs is.
Some allow discharge if you’re disabled and cannot work. In that instance, you must be able to prove that you don’t realistically earn enough to pay back your student loans, and there is no hope you ever will.
If you think you’ve been defrauded by your school and are buried in student loan debt as a result, this could be a good option to get help. Furthermore, there are even more protections coming for borrowers starting in 2017 that should provide even more relief.
The tough part is proving you’ve been defrauded. It’s important to keep copies of everything with your school in writing, and save brochures and other documents in a safe place. While many schools are honest and straightforward, a few proactive steps can save a lot of heartbreak later in life.
If you’re not quite sure where to start or what to do, consider hiring a CFA to help you with your student loans. We recommend University Of Phoenix Loan Forgiveness to help you put together a solid financial plan for your student loan debt. Check out The Student Loan Planner here.