Tag Archives: HigherEducation

Feeling Crushed By Student Loan Debt? Read This Story

Do you believe this? The U.S. Department of Education reported that 101 individuals owe at least $1 million dollars in student loans. Due to rising tuition costs and easy access to credit, the amount of people that have accrued at least $100,000 in student debt has increased. Pursuing higher education has become a financially daunting task, especially if you want a graduate degree. Some graduate programs charge tens of thousands per year in tuition. In parts of the country with high costs of living, graduate students are borrowing hundreds of thousands of dollars to make ends meet. A recent article in The Wall Street Journal discussed how a former graduate student accrued more than $601,506 in student loans for dental school at the University of Southern California. The former student’s debt is roughly the price of three Lamborghini sports cars. Due to interest and fees, his balance grew to more…
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Four Common Mistakes While Talking to Federal Student Loan Servicers

There are multiple types of mistakes you could make while repaying your federal student loans. You could make late payments or pay the wrong amount. Another common mistake is not utilizing income-based repayment programs while experiencing financial hardship. However, you should also be aware that there are mistakes you could make while talking with your loan servicer. These are companies contracted by the Department of Education to collect payments on loans and answer inquiries. There are general mistakes and major mistakes you could make with your student loan servicer. Forgetting to update your address information may not be a big deal if your servicer has a copy of your email or phone number. More serious mistakes could cost you hundreds or even thousands of dollars. Mistake #1: Not Keeping Records Student loan servicers are notorious for making mistakes. Borrowers have reported their servicers lost paperwork, applied the incorrect amount for…
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Education Department Announces Review of Student Loan Bankruptcy Rule

The Department of Education is planning to review how student loans are discharged in bankruptcy. According to the Education Department, it is seeking public comments on the process for evaluating student loan undue hardship claims during bankruptcy. Student loans are difficult to discharge in bankruptcy because of the undue hardship rule. You must show that repaying your student loans would keep you from maintaining a minimal standard of living, among other factors. Over the past several decades, changes were made to the bankruptcy code that made student loans more difficult to discharge. By the time the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 was signed into law by President George W. Bush, both federal and private student loans could not be discharged without showing undue hardship. Congress never defined what constitutes “undue hardship”. As a result, undue hardship is determined by the courts for each individual bankruptcy case….
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