Student Loan Lawyers in Seattle
If you are having trouble making payments on your student loans, have been delinquent or are currently in default on your student loan payments, Seattle, Washington based law firm, Symmes Law Group can help get you back on track.
How Can A Student Loan Lawyer Help Me?
The first step to resolving your student loan debt issue is to make an appointment to speak to a student loan attorney who can provide you with a comprehensive consultation and lay out your options. Your attorney can discuss Federal student loan programs that may be available to you, track down your loans and identify who you owe payments too, assist you in signing you up for a rehabilitation program to repair your credit or negotiate settlements on your accounts for less than the full balance that you owe.
What options are there if I have Federal Student Loans?
- Pay as You Earn This plan offers a 20 year repayment forgiveness or 10 years if borrower is in public service. Payments are determined by household size and household income.
- Income Based repayment (IBR) Similar to Pay as you earn and it comes with a 25 year cancellation (Or 20 years if your loan was received after 7/2014) or 10 year public service and payments determined by household income and size. Your payments will be 15% of your discretionary income. This option makes sense and is preferable to a forbearance because even if your income is $0, your payment will be $0 and you will get credit towards your cancellation should be noted that any debts forgiven you will have to pay federal taxes.
- Loan Consolidation With loan consolidation borrowers can make one payment a month and then you don’t have to make several payments or track down all of your different loans.
- Income Contingent Repayment If you don’t qualify for IBR or Pay as you earn. ICR payments are for a maximum of 25 years and then they are forgiven.
- Disability Discharge Qualifying for a disability discharge requires borrowers to have a permanent disability.
- Debt Settlement or modification With some lenders if your loan is in the recovery department for non payment or being collected upon by third party debt collectors you may qualify for settling your debt for less than you owe. Federal loans will generally reduce your loans by 10% if you pay with a lump sum although Symmes Law Group has obtained settlements of more than 70% of a debt due to several years of non payment and hardship. This is not the norm, but it is possible.
- Rehabilitation If your federal student loan is currently in default you may be eligible to rehabilitation your student loan so that negative marks on your credit will be deleted after payments of about 10 months that are based on your disposable income. Rehabilitating your loan will also make you eligible for future federal student loans.
- Bankruptcy In limited circumstances borrowers may file an adversary case as part of their chapter 7 bankruptcy case if a debtor can meet the standards of the Brunner test. Most borrowers will not qualify to have their student loans discharged in bankruptcy.
What options are there for people who have private student loans?
Private student loan debt is probably the worst debt that a person can have. This is because banks that offer private student loans are not obligated to offer any sort of helpful repayment plans like the government backed loans offer such as income based repayment (IBR). Private lenders, banks, credit unions and other financial firms that provide education loans hold only 8 percent of the $1.18 trillion student loan market, however they are the hardest types of loans to deal with. With that said, the times may be changing as many individuals and groups such as the National Association of Consumer Bankruptcy Attorneys (NACBA) have been pushing government to make private student loans dischargeable in bankruptcy.
Loan Modifications with demonstrated hardship
Recently Wells Fargo and Discover Bank announced that they will now offer student loan modifications in an effort to assist struggling former students with their private loan payments. A loan modification will lower your repayment interest rate but it may not allow for deferment. Wells Fargo has stated that borrowers must demonstrate a hardship to qualify for a modification but they do not need to be delinquent on the loan payments. Wells Fargo anticipates that 300-900 borrowers will benefit from the program by the end of the year. That is great news, but if the bank acts in a similar fashion to how they have said they will help homeowners with loan modifications, then it may take several months, submitting information multiple times and much heartache before a student loan modification is approved.
Although Wells Fargo says that interest rates may be lowered down to 1%, the big help will come next year when borrowers may qualify for extended repayment plans of up to five years. Other banks such as PNC and Sallie Mae have already offered modifications for student loans since 2009. Although this is great news to see some progress, the real benefit will come if/when student loans are allowed once again to be discharged in bankruptcy filings which will allow the younger generation to spend more and purchase homes which will in turn jump start the economy.
Symmes Law Group has negotiated settlements on student loans allowing for savings borrowers over 75% of their current balance. Settlements on student loan balances vary on many factors and the results may vary. The most important factor is negotiating your student loan will most likely be who is collecting on your debt. If you debt is with your original creditors and you are current on the debt, the likelihood of settling your student loan for less than the full balance is not likely. The best time to settle a debt for less than the full balance is after your account has been delinquent for several months and either sold or transferred to a debt collection company or law firm. The next factor that will have a major impact on how much you will be able to settle your debt for is whether or not you or your co-signers have a current financial hardship. For instance if you are not employed or are underemployed or had some other reason why you fell behind on your payments your chances of settling your debts for less improve. During settlement negotiations it is advisable to prepare a letter of hardship that is signed and dated outlining the reason for the delinquency and why payments fell behind. Many companies, even original creditors will take hardships into consideration, especially if income and assets are limited.
It should be noted that most settlements for less than the full balance require a lump sum payment of some sort, with a payment to be made within 30 days. On certain occasions creditors may be willing to accept the settlement payments on a payment plan but that is the exception to the rule. Also savings may be affected if you opt for a repayment plan rather than a lump sum settlement as payment plans will most likely cost the borrower more in the long run.
It should be noted that if you are going to go delinquent on your student loans there is the risk of being sued. If you are sued it is advisable to either settle your debt or file an answer to the complaint that was filed to avoid a default judgment. Once a default judgment is entered against you, the possibilities of settling your debt for less are very small.
Student Loan Debt Consolidation
Most banks may offer borrowers the opportunity to consolidate their student loans into one loan and one payment. This can be helpful for those who want to make one payment on their loans instead of multiple payments. It can also allow for a new loan to replace any loans that have fallen delinquent and provide for a new interest rate on the loan which is usually the average of all the loans that are being consolidated.
Are there many companies out there that assist people with student loan issues?
All information is public knowledge and can be provided by your student loan provider should you ask. With that said there are many private companies who are not being regulated who are taking advantage of consumers. Recently the Washington State Attorney General cracked down on a company for violating the Washington Consumer Protection Act and Washington Debt Adjusting Act. Further non law firms have no ability to defend you in a lawsuit and cannot negotiate settlements in compliance with the Washington Debt Adjustment act.
With that said most people just like any legal matter are not confident in dealing with debt collectors and need professional help to explain their rights and options. If you do to seek out help with your student loans, it is recommended that you hire an attorney as attorneys are regulated by the state bar and the likelihood of being scammed.
If you have additional questions regarding student loans and how you can rehabilitate your situation, give Symmes Law Group a call at 206-682-7975 to learn about your options.