Student Loan Rehab Program
You never expected to end up in over your head when you applied for federal student loans,
butcircumstances have a way of working out differently – and now you’re in default on payments. Fortunately, you have options to move out of default, get back on track with monthly payments and remove some of the negative issues that come with failing to abide by the terms of your loan. A student loan rehab program might be the right route to take, so consider some of the details to become familiar with these plans.
Student Loan Rehab Program
How a Federal Student Loan Rehab Program Works
If you’ve failed to make payments on certain federal student loans, your account may be placed in default; the matter is turned over to the US Department of Education’s collection service to obtain the balance due. Those borrowers who cannot repay their loans may be eligible for loan rehabilitation: Under this plan, you agree with collection service to arrange a reasonable and affordable payment plan.
Once you make all agreed-upon payments on time, your loan is considered rehabilitated and may be purchased by a lender. Keep in mind that the costs related to the collection may be added to the principal balance due.
 |
| Student Loan Rehab Program |
Student Loan Rehab Program
How a Federal Student Loan Rehab Program Works
If you’ve failed to make payments on certain federal student loans, your account may be placed in default; the matter is turned over to the US Department of Education’s collection service to obtain the balance due. Those borrowers who cannot repay their loans may be eligible for loan rehabilitation: Under this plan, you agree with collection service to arrange a reasonable and affordable payment plan.
Once you make all agreed-upon payments on time, your loan is considered rehabilitated and may be purchased by a lender. Keep in mind that the costs related to the collection may be added to the principal balance due.
- Beware of Some Collection Tactics: When you request rehabilitation from your loan holder, you’re often working with a collection agency that may try to collect an affordable payment. This is against the law, as you are only required to pay what’s reasonable and affordable. The loan holder should discuss your options, which will focus on your income and household circumstances.
Benefits of the Federal Student Loan Rehab Plan
When the loan rehabilitation process is complete, you once again have access to the benefits that were available to you before you defaulted on your federal student loan. You might qualify for a deferment or forbearance, giving you additional options for repayment of the entire loan balance. Under certain circumstances your loan may be forgiven and you may qualify for additional federal student loans.
Additional benefits of federal student loan rehab include:
When the loan rehabilitation process is complete, you once again have access to the benefits that were available to you before you defaulted on your federal student loan. You might qualify for a deferment or forbearance, giving you additional options for repayment of the entire loan balance. Under certain circumstances your loan may be forgiven and you may qualify for additional federal student loans.
Additional benefits of federal student loan rehab include:
- Removal of the default status of your loan;
- Removal of the default status as it’s reported on your credit rating;
- Cutting off any wage garnishment; and,
- Eliminating any withholding of your income tax refund as established by the Internal Revenue Service.
Eligibility for Income Based Repayment Plans (IBR)
Once you’ve brought your account status to good standing under the federal student loan rehab plan, you’re able to take advantage of other programs intended to assist borrowers having trouble making payments. One such arrangement is the income based repayment plan (IBR) administered by the US Department of Education. If you’re eligible, the IBR program allows you to pay an amount that’s based on your income and household size.
Federal Student Loan Attorney in San Diego
The advantages of a student loan rehab plan are attractive to anyone in default on their federal student loan. However, you need to be aware of some of the issues related to post-rehabilitation status and eligibility for programs to help you pay back the full amount once you’re removed from default status. For more information on loan rehab, income based repayment plans and assistance with private loans, contact a federal student loan attorney in San Diego.
0 comments:
Post a Comment