Financial Freedom can be yours for only 120, or was it, 300 payments of $0.00-$3,000.00 per month!
Why so
vague?
To get your attention. Reel
you in. Make you sign on the dotted line before you realize that the financial
loan package you are being talked into may NOT be in your best interest.
It's no
coincidence that student loan payment terms sound like late-night infomercials.
Take federal loans, for instance. There are many different monthly payment
options available and no one size fits all. But you don't have to be
floundering in the dark. If you happen to be a current or former student
struggling to figure out where you stand and how much you owe -- or you know
someone who is -- you can find out what your best course of action is and
whether or not you need to set up a repayment plan that is more manageable.
Should
you discover that you are unable to afford your current (or anticipated)
monthly payment, what are you supposed to do? You can: minimize your expenses,
look for a second job or contract work, stop binge-watching premium content,
and sell plasma (I have done this).
In case
you think you can avoid dealing with the problem or you can declare bankruptcy,
I have news for you. That's not going to help. It's only going to further
compound the problem. Student loan debt is practically impossible to wipe out,
unless of course, you qualify for an undue hardship exemption. http://www.nolo.com/legal-encyclopedia/student-loan-debt-bankruptcy.html
The only
other way to have your student loans discharged is if you become totally and
permanently disabled. In layman’s terms, you might qualify for this if there is
no chance of you working in any capacity ever again. See this link for more
info. http://www.disabilitydischarge.com/home/
Most of
us are thankfully not permanently disabled. Still, student debt can disable you
enough so that you feel powerless. Awareness of the true nature and extent of
your debt obligations will empower you, and once you figure out what your
options are, then you can form a reasonable plan of attack. And here's hoping,
once you come up with a viable solution, there's enough left over in your
budget so you can afford some creature comforts like a night out on the town or
a new app. I also believe that with the right payment plan, you can contribute
to things like a 401k, IRA, etc.
The good
news is, you do not have to watch late night TV or the home shopping network to
figure out where you stand. For federal loans, the data you need is located
here:
This site
provides you with an up-to-date balance on any outstanding federal loans, as
stated in the national database. Another
valuable feature that the website provides is a repayment calculator. If you
know about the various repayment plans already, that’s awesome. You are ahead
of the pack. But if you don't and/or if you're unsure what your monthly
payments are likely to be, you can enter your particulars into the calculator
and it will generate a number of scenarios.
After you
have entered your data and crunched the numbers, you will notice how payments
can vary based upon your AGI (Adjusted Gross Income), family size, and marital
status. This website also produces charts that calculate projected forgiveness
amounts, total amount paid, and interest paid.
Similarly,
should your circumstances change, you may use these results to help you
renegotiate better terms on your outstanding loan(s) and if applicable, change
your payment plans.
In
subsequent blog posts, I will discuss the pros and cons of each repayment plan.
But whatever you do, don’t fall into delinquency and don't renege on your loan
obligations. Some students end up in default because they can’t afford their
monthly payments and are unaware of different types of recourse they have in
mitigating their debt burden.
It has been
rumored that many student loan servicers won’t tell you that you have options
for repayment. In fact, there has been speculation on the Web that certain
servicers and investors actually like it when a borrower gets behind, since it
drastically inflates the amount of money owed. Whether that is true or not
remains to be seen. In upcoming posts, I will be using this blog as a platform
to do additional fact-finding and together, we will try to uncover the truth.
In the meantime, you can read these articles and decide for yourself:
*
Wall Street Sees Big Money in Student-Loan Defaults
*
Sallie Mae Under Fire For Death-Induced Defaults
* Sallie
Mae Not Opposed To Bankruptcy Relief For Student Loans
The point
is, be informed. Know your enemy.
In the
spirit of “know your enemy,” you can also read Sun Tzu’s The Art of War:
If you
don't have time to read, you can watch an excellent depiction produced by the
History Channel:
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