Today’s college graduates have to face financial reality more quickly than just a few decades ago. You are given only six months grace from your graduation date until you have to start repaying your student loans. Don’t have a job yet? Too bad, kid. Welcome to the real world. In the 1970’s, college students figured out that by declaring personal bankruptcy, student loans could be forgiven or pushed back a few years. Unfortunately for future generations of American college graduates, in 1998 the law was changed to make student loans non-dischargeable.
Make Student Loans What?
“Non-dischargeable” is our vocabulary word of the day, class. Translating it into American English, this means that if you declare personal bankruptcy, student loans still need to be paid. You cannot get out of it, unless you suddenly drop dead, but that kinda defeats the purpose of getting a college degree in the first place. The Federal Student Aid Ombudsman (FSAO) says there are only three extremely hard to fulfill criteria for exemption of this non-dischargeable rule. You must fulfill all three. They are:
If the loan repayments force you to a “lower than minimum standard of […]
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In our day when a bachelor’s degree doesn’t get you all that much any more, students are being taken advantage of. I can understand higher prices for graduate school, but the undergrad prices are absolutely ridiculous in my opinion. Current first-year students had been expected to graduate in 2011 with an average loan obligation of $21,000 — a number that would have continued to increase for subsequent classes. But by converting loans to grants, Bowdoin will eliminate a significant debt burden for next year’s entering class while capping debt at current levels for continuing students. So the future, we could see Sharia student loans that work like venture capital. The lender would get a cut of the student’s future earnings.A student that gets a federal student loan made directly to them must be a half or full time student attending university or college. Payment does not start until they drop to less than a half time student or finish school. Loans that parents take have a much higher limit but payment for these federal student loans starts immediately. Interest begins to accrue immediately on private student loans made to parents or students but the limits are higher […]
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Too many Americans suffer from overwhelming credit card debt. Unfortunately, many people just continue to pay their monthly minimum payments without any knowledge that their debt burden may never go away.When a person comes to the realization that they are caught in an endless cycle of debt, they may then admit that help is needed. What people may not know is what kind of help is available, and how to find it.Understanding all of the options to relieve themselves of debt can be very confusing. Choosing the best plan of action can also add the stress caused by the debt in the first place.One option is to enroll in a Debt Management program. A Debt Management company will attempt to work with your creditors to lower the interest rates and waive any fees, such as over-the-limit fees and late fees. Please notice the words “attempt to”. There is no guarantee that the creditor will agree to lower the interest rate or waive any fees. Interest rates may actually increase when a credit card company is informed of a financial hardship.With a Debt Management program, your budget will be analyzed to determine how much […]
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