Jump to Navigation

Hedge fund manager says student debt may result in market crash

Many Washington, D.C., residents know what it's like to struggle with student debt. Even with a good degree and a good job, it can be difficult to pay off student loans. When jobs are scarce, or don't pay very well, it can seem almost impossible. High interest rates lead to endlessly accruing debt and college graduates can find themselves in the unenviable position of being stuck in a mire of debt.

When people default on their student loan debt, they may face a number of penalties. They may have their tax refunds withheld or their wages garnished. They may even lose federal benefits or see their professional license revoked. In some cases, they may even be sued by the Department of Education.

Unfortunately, under current federal law, it is very difficult to discharge student loan debt through personal bankruptcy, such as Chapter 7 or Chapter 13. Thankfully, there are other ways to get student loan debt under control.

Under some circumstances, borrowers can get a deferment on student loans. This option is typically used for those who can show economic hardship. Depending upon the type of loan, the borrower may be able to suspend paying off the principal while also stopping the principal debt from gathering interest.

Those who do not qualify for a deferment may be able to secure a loan forbearance. Under this type of debt relief plan, the borrower would be able to suspend payment for a certain period of time. The big disadvantage here, compared to a forbearance, is that interest continues to accrue during the suspension period.

These are just two of the more common methods of getting relief from student loans. There are other options available, depending upon the type of loan and the specific circumstances of the borrower. Attorneys with experience in debt relief and bankruptcy law can help borrowers to understand their options.

No Comments

Leave a comment
Comment Information
Start Right Now

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

Visit Our Bankruptcy Law Website Subscribe to This Blog's Feed
Office Locations

1115 Massachusetts Ave NW,
Washington, DC 20005
Phone: 202-559-1428

10512 Pohick Court,
Fairfax Station, VA 22039
Phone: 703-550-7030

6926 Seven Locks Road,
Cabin John, MD 20818
Phone: 301-890-4500

Toll-Free: 877-441-4076
Fax: 202-638-5858

Twitter link