Private student loan debt continues to be a problem for borrowers of all ages in the US. The statistics are pretty staggering too—with the cumulative debt now rising even higher to $1.74 trillion, with over 45 million Americans on the line to pay back loans. Previous to the threat of coronavirus looming over the nation, private student loan borrowers were already worried about enormous balances, with many in the 20- to 30-year-old range paying an average of $400 per month.
Private student loan debts tend to be larger, especially due to the greater expense of graduate school; however, this also makes them more difficult to pay back in the face of unemployment, or perhaps a slow kickstart to their careers straight out of college. So many factors come into play regarding who is to blame for the student loan crisis, but in many cases students expect to be earning much higher incomes right out of the gate post-graduation than is realistic. In turn, this makes them feel more comfortable in taking out large student loans that could be difficult to pay back.
Communication is key when it comes to all that educational debt encompasses, and for borrowers—most especially the younger ones—counseling is imperative. Another area where many financial institutions and schools fall short, pre-loan counseling and also upon the exit of school could help borrowers have a more comprehensive understanding of what lies ahead in terms of having to budget in significant monthly payments over the long term.
If you have fallen into default for whatever reason, reach out for help as soon as possible. This could be the difference between reasonable negotiations with a creditor (of any type) or being sued and then finding a default judgment granted against you. Keep in mind too that right now creditors are extremely amenable to negotiating rather than finding themselves completely in lurch and never getting paid back at all—even if they do sue.
Without any action at all, if you are sued by a private student loan debt servicer, the consequences could be even worse than dealing with a default on a government loan. Private lenders have the freedom, number one, to file a collection lawsuit, and two, to pursue it aggressively in the face of a default judgment. Explore all your options before walking away from this type of responsibility and consider negotiating a deferment, reorganizing payments so they are more affordable, or perhaps even a total refinancing of your loan.
Have you experienced problems with your loan service provider or student loan program, or are you in danger of defaulting on your student loan? Speak with an attorney from Fitzgerald & Campbell, APLC as soon as possible to examine your options. 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 (844) 431-3851, or email us at email@example.com.