Monday, March 30, 2009

Student Loan Defaults

If you have defaulted on your student loan, you will likely to have to repay this debt and your credit will be ruined. This will put you in a difficult position.

When your student loan is in default, the government can garnish your wages, your social security benefits and more. Your account is sent to collection agencies and various collection efforts begin.

These debts can be collected upon for life! However you can only have a negative mark on your credit report for a maximum of seven years. This is according to a law that Congress created called the Fair Credit Reporting Act.

If you have a defaulted student loan on your report, more often than not you will be turned away for a new line of credit. You are likely to have to pay interest rates of roughly 25% and place large down payments just to be approved.

However there is hope you can remove this mark from your report and with some luck you may be able to remove the debt entirely. In order to do this you should dispute the collection marks on your report.

You should send a dispute letter to each bureau; in your letter provide an explanation as to why the mark is not accurate. For example; it has been reported for seven years already, not my account, account is paid in full and so on.

This is the most difficult item to negotiate on a credit report and thus we suggest that you should hire a credit repair service to dispute it on your behalf. The benefit is you will have a licensed attorney fighting for you and there are continuously new laws passed by congress to help protect consumers.

Hiring an expert can be done at very reasonable rates and, compared to the high cost of a low credit score, is a good idea. We feel it is worth the money since your credit score impacts every aspect of your life.

Please be aware that a private loan, such as one with Sallie Mae, will be difficult to remove but easier than a federal loan. A loan from the government, such as a Stafford loan or the Perkins loan, will be much harder to remove from your report.

The creator of the negative mark will be contacted by the bureaus and asked to verify the debt, including that the account is yours, the balance of the account, and that the dates are correct. This will take place as soon as the bureaus receive your dispute letter.

The Fair Credit Reporting Act states that any unverifiable mark on your credit report must be removed. Therefore, if the account can not be verified, the negative mark must be removed from your credit report.

If this mark is in error then send any documentation that you have with your dispute letter to prove it is in error. The bureaus make errors all the time and so do the lenders, but your credit is the one that will suffer. It is estimated that 1 in every 4 people have an error on the report that is costing them money in higher interest rates.

In conclusion, defaulted student loans are removed every day from credit reports. If you have this, it does not mean you will have a low credit score for the rest of your life. We suggest you dispute this mark with the credit bureaus.

By: Josh Hlizen

Check out the Related Article : Student Loan Consolidation

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Saturday, March 21, 2009

What One Must Know About A Students Loan Consolidation Program?

It is generally asked by the students what the loan consolidation is all about? It is an act of combining more than one student loan into a single loan. In other words if a person has more than one loan to be paid, in consolidation of loan he combines them all into a single loan to be paid only once in a decided or defined time period to only one center or company.

In this way a Student Loan Consolidation Program is a program of loan repayment for college students or graduates. For example if a student has taken five government loans, with the help of this program he can consolidate them all into a single loan. Five separate loans taken previously shall be considered paid in full, and he shall have to pay only the consolidated loan with newly defined terms and conditions. He will have to keep in mind just one due date, and just one center.

Mostly this program suits more to a student who has taken so many loans in past. A student interested in this new loan should first consider the available options. He should decide carefully if the guaranteed state loan suits him more or the plus loan or even a private student loan.
However, these programs are only available to students who have a lot of educational loan debt. Before accepting any financial aid, you should first ask about the options available. After that, then you can decide if you can qualify for a guaranteed state loan, a plus loan, or a private student loan.

Entrance fee, Examination fees, laboratory fee, library fee, board or lodging and traveling abroad for studies are the expenses a student has to consider before applying for a student loan. Now if he has taken his degree and he has $25,000 to be repaid he can qualify for refunding some cash in consolidation programs. He can also have some additional rate reduction.

On a consolidation loan, the rate of interest is based on the average rates of interest on the loans a student decides to consolidate. Once the rate is decided it will remain unchanged throughout this new consolidation loan. The rate, however, should not increase from 8.25 %

By Anthony Banks
Check Out the Related Article : Student Debt Consolidation Loans

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Tuesday, March 17, 2009

Why Students Opt for Student Loan Debt Consolidation

Going to college is not easy today. The fees, books, travel all bring up a hefty sum of money that has to be spent for college education. Some people may in fact, have to take out some student loans to cope with all these fees and rising costs. With these loans, there comes with it monthly payments to be paid, and sometimes, this in turn leads to more loans that will be used to pay back these loans.

Usually, the consequences of all these loans are debt, and to come out of student loans, students often opt for student loan debt consolidation. When we speak of student loan debt consolidation, all the student loans will be consolidated into a single loan which is called the student loan debt consolidation loan. With this loan, there is no need of keeping track of all the individual student loans, and to make payments to all these loans. Instead, only a single payment is made towards the student loan debt consolidation loan.

This is the main reason children opt for student loan debt consolidation. They find it rather tedious having to shoulder the responsibilities of studies, day to day living chores and keeping track of all the student loans while making timely payments to the necessary sources. With a student loan debt consolidation loan, all the related tension is reduced wherein the student can concentrate more on their studies, and make the most of their education.

Another reason students prefer to take a student loan debt consolidation loan is that there is usually some savings in the monthly installments of student loan debt consolidation loans. In the various student loans that you take to complete your studies, the interest rates for the various loans will be varied. Some of them may be a bit on the higher side, and some of them on the lower side. With this, the monthly installment for some loans would have been high, and some low.

But with the student loan debt consolidation loan, you find that the interest rate here will be lower than the average interest rates of the other student loans. So the monthly installment for the student loan consolidation loan will be lower than the combined monthly installments of all the student loans.

With the student loan debt consolidation loan, the student will usually have a longer time to repay the loan. In fact, the larger is the combined student loan amount, the longer will the time you have to repay the loan. And the longer is the period; the lower will be the monthly installment you have to pay. However, if you feel that you can pay more than the amount stipulated by the student loan debt consolidation company, you can pay more, and clear the loan within a shorter time span.

With a student loan debt consolidation loan, you stand to improve your credit rating too. This is because there is a chance of missing payments with the many individual student loans. However, with this loan, since there is only a single payment to be made, the chances of missing payments are lower.

By Gibran Selman

Check Out the Related Article : Student Debt Consolidation Loans

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Wednesday, March 11, 2009

Government Student Loan Consolidation Can Help With Your Debt

A government student loan consolidation is a program that allows students to consolidate outstanding education loans into a single new loan. Even if many lenders hold the loans, you can still opt for the consolidated loan.

The government student loan consolidation is convenient to students and parents since it simplifies the repayment of loan. Government consolidation loans have lower monthly payments and have flexible terms and conditions for repayment.

Students with more than $10,000 outstanding student loans are eligible for this type of program. Private student loans can also be consolidated. However, you should not consolidate federal and a private student loan. With the private loan consolidation, you cannot forbear payments if you ever have economic hardships. Private loans are not eligible in claiming for tax deductions. Also, if the borrowers passed away, federal loans are forgiven while with the private loans, loans are passed to the next kin.

It is important to consolidate federal student loans since it reduces the number of credit loans you may have. Credit check is also not required with the government student loan consolidation since the US government guarantees federal student loans.

Application for government student loan consolidation is very easy. For borrowers with $10,000 to $19,999 loan balances have a repayment period of 15 years.

Federal student loans are easier to pay and bring less long term hassle and panic if these debts are converted into Federal Student Loan Consolidation. Consolidating your loan means that all the different types of student loans you acquired will be combined in one loan.

Since federal student loan interest rates are currently at their lowest, loan consolidation actually means that the interest rate used for the whole duration of your loan is fixed.

You will be able to pay the student loan off faster than when you did not consolidate your loans.

One category you could take into consideration regarding federal student loans is availing of the FFEL consolidation loan.

This loan program helps any borrower via multiple repayment schedules. Through the FFEL loan consolidation program, only one payment is made each month. Again, refinancing student loans depends on the borrower.

The following is a basic list of some student loans that are eligible to be consolidated:

PERK - Federal Perkins Loans, formerly Nations Defense/National Direct Student Loans (NDSL), PLUS - Federal PLUS (Parent) Loans, SCON - Subsidized Federal Consolidation Loans, UCON- Unsubsidized Federal Consolidation Loans, SLS - Federal Supplemental Loans for Students (formerly Auxiliary Loans to Assist Students (ALAS) and Student PLUS Loans), SS - Subsidized Federal Stafford Loans & Guaranteed Student Loans (GSL), DSS - Direct Subsidized Stafford Loans, DUS - Direct Unsubsidized Stafford Loans, DPLUS - Direct PLUS Loans, DUCON - Direct Unsubsidized Consolidation Loan, including Direct PLUS Consolidation Loans.

By Dean Shainin

Check Out The Related Article : Student Debt Consolidation Loans

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