Bad News for FFEL Student Loan Borrowers
- Did you take out student loans prior to 2010?
- Are those loans Federal Family Education Loans (FFEL)?
- Are the loans in behind or are you in danger of falling behind on payments?
If you answered, “Yes.” to the above questions, contact a certified student loan counselor now. On Thursday, March 16th the U.S. Department of Education withdrew a 2015 rule that prevented loan guarantee agencies from adding collection fees to the cost of defaulted (270 days past due) student loans. This means that as much as 25% of the loan total (amount borrowed and interest) could be added to the cost of a student loan that goes past due – and you do not have to be in default.
Find out what payment plans you qualify for today. There are many options for keeping a loan in good standing. These include:
Income driven repayment plans. These plans are based on the type of federal student loan as well as the borrower’s income, family size and amount owed in loans.
Forbearance. Postponing payments on loans while you have an economic hardship, serve in the military or have another qualifying reason.
Forgiveness. In some instances you can have your student loans forgiven. Examples of these situations include people who work in public service, teachers and people who are permanently disabled. Be aware that certain forgiveness programs do have income tax implications.
Contact a certified student loan counselor right away to make sure you understand all of your options and avoid the penalty of excess fees and financial damage. Call (800) 895-4795 for help today.
Published Mar 21, 2017.