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Private Student Loan Bankruptcy

December 15, 2011

Private Student Loan Bankruptcy

Private Student Loan Bankruptcy

There has been a lot of debate to whether private student loan bankruptcy is actually possible, which there have been cases where individuals have been able to discharge their student loans through the act of filing bankruptcy, where as some privatge lenders actually state that bankruptcy is not a possibilty. The general rule of thumb that applies to the eligibilty to partake in student loan bankruptcy for private loans is that you must prove that your are experiencing what is called “undue hardship”. The basic definition of undue hardship is, if student loan payments are creating a large burden on yourself or the one who is responsible for paying off your loan like a parent, or creating hardship for your family like a couple or a couple with children.

What situation qualifies for undue hardship? Well for examples sake, Sallie Mae one of the biggest providers of private student loans, states that in order to qualify for undue hardship and use private student loan bankruptcy as a way to discharge your loans, you must basically not be able to work and not able to make any money at all. In this case, in order to use bankrytcy for private student loans, you will actually need to go in front of a judge and prove your situation.

Why Is Private Student Loan Bankruptcy So Hard To Qualify For

The basic reason that it is hard use private student loan bankruptcy is the fact that is has no benefit for anyone, being both your private loan lender who will lose money as well as tax payers will actually lose out on money as well. Not to mention that fact that the one who files for private loan bankruptcy will end up ruining their credit as well as pretty much losing out on the privelage of borrowing money. So the real reason to make it so hard to qualify is to protect pretty much everyone who would be affected.

Latest News On Private Student Loan Bankruptcy

Although the outlook on one qualifying for private student loan bankruptcy looks pretty dismal, there is a law in the works that can drastically change the rules to who and what situation can qualify for bankruptcy. The law that is being processed right now is:

  • The Private Student Loan Bankruptcy Fairness Act of 2011 – This act is just now in the first step of the entire legislative process.
  • Fairness For Struggling Students Act of 2011

Alternatives To Consider Before Bankruptcy

Private student loan bankrupcy obviously should be considered as a last resort as it can impose negative situations on your life. Some other alternatives that you can consider, which will help you get out of debt are:

  • Talking To Your Lender – If you contact your private loan lender and explain your current situation, there is a great possibility that they will work with your, and cater a payment plan that geared more to what you can afford. This can be a great method as lenders want you to pay back the loan and not discharge, so they will often times take extreme measures to keep your business. This can include your payments being reduced or stopped for a while, but will consist of accruing interest during that time.
  • Consolidation – Consolidation of your loans is another great option to consider to avoid filing for private student loan bankruptcy, even if you have one loan as consolidation requires at least one loan. What consolidation does is stretch out your repayment term to as long as 25 years, which will reduce your payments, as they know you will end up paying more in interest over the life of the repayment, but once you are able to pay more you can usually do so without penalty and get out of debt faster. One thing to keep in mind is that you can get lower interest and better terms with good credit, which you either need to have good credit or find a cosigner who does.

 

Private Student Loans Bad Credit

November 1, 2011

Private Student Loans Bad Credit

IF you are looking for information on private student loans bad credit, we have you covered! Every private student loan is fully credit based, but do not let this get you down and out as there are loopholes in the system! The fact alone can be discouraging right off the bat, but do not let it deter you from attaing your dream of graduating college, you can consider the following options to solve your problem.

Private Student Loans Bad Credit

Private Student Loans Bad Credit Options

First off, you can still get a private student loan with bad credit, but your loan will come with higher interest rates as well as higher origination fees, also known as activation fees that require you have to pay when you first take out the loan. These negative aspects will take place in the event that the loan is actually approved, which in many cases it is not. In order to fix this problem, it is imperative that you:

  • Seek out a cosigner that has a great credit score. Do make your chances of loan acceptance as best as possible, try to get a cosigner that has a credit score that is higher than 700 as scores higher than this show the best rate of success

Now this cosigner doesn’t need to be a parent or gaurdian, or even blood related, but must be willing to stick their neck out as far as monthly payments go being that they assume the responsiblity of paying and loan debt that the student is not able to pay, which if they cannot cover this then it will both affect their credit score as well as pose the possiblity of losing the loan. The great thing about this private studetn loans for bad credit tool is that there is an option to tranfer the loan to the students name later on down the line, usually being around 4 years after the conclusion of college, where the student can now build their own credit score.

Good Private Student Loans Bad Credit Lenders

Now that you know the main overview about the private student loans bad credit topic, you may want to know about good private lenders to use. The list below can give you a start into weighing your options about which lender you ultimately want to use. It also should be known that in order to get the greatest private student loans, there are three things, although these aspects are usually only attained by an applicant with a very high credit score. The rules that you should try to follow which are:

  • Loans that come with no fees.
  • Have a LIBOR (London Inter-Bank Offered Rate) or 2.0 percent or PRIME rate of .50 percent

Sallie Mae Education Trust – First option to consider for private student loans for bad credit is Sallie Mae Education Trust. This option provides its eligible applicants with benefits such as; rates as low as 2.5 percent, up to 30 years for repayment, a 6 month grace period before you have to start paying back debt as well as the benefit of 5000 dollars in coverage due to expenses paid on medical bills.

Citibank – This national bank provides another great resource when it comes to finding a solution for private student loans with bad credit. Benefits of private loans through Citibank include; no origination fees, variable rates that are as low as 2.96 percent, interest dicounts for auto debit, and no payments until school in completed.

Wachovia Education Loans – Offered at interest rates starting as low as 3.4 percent, offers up to 25,000 dollars in yearly borrowing limits, certain discounts for like auto debit among others, and you do not have to pay back the loan until you graduate.

Private Student Loan Consolidation Providers & Overview

October 12, 2011

Private Student Loan Consolidation

private student loan consolidation

Major Overview:

  • By utilzing the act of private student loan consolidation, you are basically partnering with a company who will pay off all of your private loan providers, to provide the convenience of you only having to pay one payment, and that is to you consolidation provider. This is done by providing a consolidation loan.
  • Private student loan consolidation should be done sperately from federal student loan consolidation because you will lose the benefits that come with federal consolidation loans which are much better than private.
  • The term of your loan is reset when you use consolidation your private student loans, this often equates to lower monthly payments, but is done by providing a longer repayment period which means more interest paid. Although this can be avoided by finding a consolidation company that doesn’t charge a penalty fee for paying more than the monthly minimum.
  • You can consolidate one loan and still enjoy the benefits of consolidation.
  • Payments need to be made usually within 30 to 60 days after you start your private student loan consolidation contract.
  • Repayment periods usually last around 15 to up to 30 years and are a bit shorter for undergraduate students compared to the graduate student repayment period.
  • Active duty military members many recieve a deferment period of up to 36 months as well as medical and dental residents can be granted up to a 48 month deferment time.

Private Student Loan Consolidation Tips

  • Being that private student loans are credit based, in the event that your credit score is a lot higher since the time that you took out the private loans, you may be able to get a much lower interest rate with a private student loan consolidation company compared to what you are paying to your currrent lender(s).
  • Negotiating with your lenders is another viable option as they want your business and are looking to keep it at all costs, which can open up an opportunity to negotiate lower interest rate terms.
  • If you can find a co-signer with a better credit score than you do, this can be a great way to get a lower APR rate. After a couple years, the consoldiation balance can be tranferred from your co-signers name to your name where, they will submit your payment history to credit bureaus, and you can boost your own credit score.

Private Student Loan Consolidation Providers

If you are still looking to utilize private student loan consolidation, you can use these accredited providers to take advantage of the benefits.

  • Wells Fargo Private Student Loan Consolidataion – Interest rates are either fixed or variable, a 5,000 dollar minimum debt and 40,000 to 100,000 maximum, no activation fee, slight discounts for those who already hold an account at Wells Fargo as well as those who enroll in auto debit, variable interest rates range anywhere from +1.0-5.75+ which are Prime rates and for fixed rates 8.8-13.3 percent
  • NextStudent Private Loan Consolidation – Every quarter their interst rates vary, loan consolidatoin starts at 7,500 in private student loan debt to up to 300,000, offers up to 30 years for repayments and they do not charge any fees for higher repayment amounts.
  • Cedar Education Lending Private Student Loan Consolidation – Amounts range from 7,000 to up 100,000, 1 percent activation fee, after one year the cosigner can be “released” and the debt will be tranferred to the person who originally took out the loan.

 

Consolidating Private Student Loans – Advantages & Disadvantages

August 27, 2011

Consolidating Private Student Loans

Are you looking for inforamtion on consolidating private student loans, well you are in the right places as we will show you both the advantages and disadvantages of this process. Lets face it, pretty much everyone that goes to college has to take out more than just one loan to have enough to pay their tuition, some three or four or more. Consolidating private student loans can be an excellent way to save you both time and money, among many other things, but is it for you? The next section will provide and overview of the process as well as go into detail about both sides to consolidating private student loans, so you can decide for yourself.

Consolidating Private Student Loans

Overview Of Consolidating Private Student Loans

If you aren’t familiar with the process of consolidating private student loans, it is essentially where all of your loans are combined into one lump sum where you just pay one loan payment per month. You can do this through many consolidation companies out there who will take care of all the major details, like paying off your loan lenders so that they can now be your sole loan lender, so where all you have to worry about is getting your payment in on time.

Pros & Cons of Consolidating Private Student Loans

First we will start with the benefits that are provided to one who is thinking about consolidating private student loans:

PROS

  • Consolidation companies reset all of the financial payment information once they obtain your loans, like monthly payment as well as interest rate. By searching for a consolidation company that does private student loans, you can get one who requires both lower monthly payments as well as lower interest rates compared to what you were paying to your previous lenders. A lower credit score can be attained if your credit has improved from when you first took out your loans, as a credit  check will be run, and is one of the main factors in your eligibility.
  • Another great benefit to consolidating private student loans as that most all consolidation companies have very flexible repayment options, meaning that you can pay your student loan off a lot faster by upping the monthly payment, as well as save in the interest you would have paid if you just paid the minimum.
  • You only have to focus on making one payment instead of multiple as well as only have to call one resource for any questions related to your repayment programs.

CONS

Here are some of the drawbacks of consolidating private student loans:

  • The first disadvantage to consolidating private student loans is the oriantation fee, also known as the activation fee, which is what you pay when you first establish an account with a consolidation company, can be very high in many cases. For example, say that you will have a 50,000 dollar sum in which you consolidate, and the activation fee is 4 percent, that equates to an extra 2000 dollars you have to pay.
  • Second, if by chance your credit schore is down in the dumps, consolidating your private student loans can result in you paying a lot more when it comes to interest. Like is was said above, the interest rate that you will pay is heavily based on your credit score, and it will be much higher if you have a negative credit history.
  • Consolidating private student loans can also result in you not being able to qualify for certain forgiveness programs, which are programs in which a big part of your debt can be wiped away.
  • Like it was said above, the repayment methods are flexible which lead many to choosing a longer period in which they want to pay off their debt. This will result in you paying a lot more on your loan and interest.

Consolidating Private Student Loans – Conclusion

Now that you know what the benefits and disadvantages are of consolidating private student loans, it should be easier to make your descision whether you want to go for it or not. It can be a great benefit to some, but can really be an even bigger burden to others. The best thing to do now if you are still contemplating whether or not to consolidate your private student loans is to do your homework by taking the pros if they are relevant to your situation, as well as weighing the cons to see if benefits outweigh them. The other thing you can do when thinking about consolidating private student loans is to shop around with different companies, and view what their guidelines are.

Is Consolidating Private Student Loans A Good Thing?

August 26, 2011

Consolidating Private Student Loans

Are you looking for inforamtion on consolidating private student loans, well you are in the right places as we will show you both the advantages and disadvantages of this process. Lets face it, pretty much everyone that goes to college has to take out more than just one loan to have enough to pay their tuition, some three or four or more. Consolidating private student loans can be an excellent way to save you both time and money, among many other things, but is it for you? The next section will provide and overview of the process as well as go into detail about both sides to consolidating private student loans, so you can decide for yourself.

Consolidating Private Student Loans

Overview Of Consolidating Private Student Loans

If you aren’t familiar with the process of consolidating private student loans, it is essentially where all of your loans are combined into one lump sum where you just pay one loan payment per month. You can do this through many consolidation companies out there who will take care of all the major details, like paying off your loan lenders so that they can now be your sole loan lender, so where all you have to worry about is getting your payment in on time.

Pros & Cons of Consolidating Private Student Loans

First we will start with the benefits that are provided to one who is thinking about consolidating private student loans:

PROS

  • Consolidation companies reset all of the financial payment information once they obtain your loans, like monthly payment as well as interest rate. By searching for a consolidation company that does private student loans, you can get one who requires both lower monthly payments as well as lower interest rates compared to what you were paying to your previous lenders. A lower credit score can be attained if your credit has improved from when you first took out your loans, as a credit  check will be run, and is one of the main factors in your eligibility.
  • Another great benefit to consolidating private student loans as that most all consolidation companies have very flexible repayment options, meaning that you can pay your student loan off a lot faster by upping the monthly payment, as well as save in the interest you would have paid if you just paid the minimum.
  • You only have to focus on making one payment instead of multiple as well as only have to call one resource for any questions related to your repayment programs.

CONS

Here are some of the drawbacks of consolidating private student loans:

  • The first disadvantage to consolidating private student loans is the oriantation fee, also known as the activation fee, which is what you pay when you first establish an account with a consolidation company, can be very high in many cases. For example, say that you will have a 50,000 dollar sum in which you consolidate, and the activation fee is 4 percent, that equates to an extra 2000 dollars you have to pay.
  • Second, if by chance your credit schore is down in the dumps, consolidating your private student loans can result in you paying a lot more when it comes to interest. Like is was said above, the interest rate that you will pay is heavily based on your credit score, and it will be much higher if you have a negative credit history.
  • Consolidating private student loans can also result in you not being able to qualify for certain forgiveness programs, which are programs in which a big part of your debt can be wiped away.
  • Like it was said above, the repayment methods are flexible which lead many to choosing a longer period in which they want to pay off their debt. This will result in you paying a lot more on your loan and interest.

Consolidating Private Student Loans – Conclusion

Now that you know what the benefits and disadvantages are of consolidating private student loans, it should be easier to make your descision whether you want to go for it or not. It can be a great benefit to some, but can really be an even bigger burden to others. The best thing to do now if you are still contemplating whether or not to consolidate your private student loans is to do your homework by taking the pros if they are relevant to your situation, as well as weighing the cons to see if benefits outweigh them. The other thing you can do when thinking about consolidating private student loans is to shop around with different companies, and view what their guidelines are.

Private Student Loans – 4 Lenders & Their Benefits

August 26, 2011

Private Student LoansPrivate Student Loans

If you happen to be looking for private student loans that you can use for your college tuition, there are many programs out there, some great, some not so great. In order for you to get the best program, you have to know where to look, and that’s where we come in. You will be provided with 4 of some of the best private student loans providers around so that you can get the money you need to complete college as well as do it with a program that has excellent benefits. Just to top it off, you will also get a list of the benefits that come with taking out private student loans.

Private Student Loans – 4 Lenders

  1. Sallie Mae Private Student Loans – They have what is called the Smart Option Student Loan that provides many benefits like; no activation fees, no prepayment penaltiles, an interest repayment option allowing your to pay your interest while you are in school which will save you up to 5000 dollars, rewards for paying your bills on time like percentages off your loan, allows you to borrow up to the cost of your tuition, and up to 5000 dollars in covered fees that you can use for medical fees. The interest rates on this loan are anywhere from 2.0 to 9.88 percent. They have private student loans for many types of students including undergraduate, graduate and professional.
  2. Chase Bank Private Student Loans – This option also provides undergrads, graduates and professional students the opportunity to obtain private student loans and offers many advantages to their eligible applicants. Some of those benefits being; no payments while you are in school, no activation and repayment fees, and allows you to get funding for many facets of your shcooling like, tution, books, cost of living and buying a computer. This program offers a 25 year repayment option.
  3. Wachovia/Wells Fargo Private Student Loans – This option has been the lending hand to millions of students and has benefits like; discounts up to 1 percent, interest rates as low as 3.4 percent which there are both fixed and variable loans, you can borrow up to 25,000 dollars per school year, and don’t have to pay a dime until after your college is over.
  4. Access Group Private Student Loans – This option will allow you to to get many of the benefits of the other lenders above and allows you to either apply with or without a co signer, and has a 25 year repayment program.

These are 4 of some of the greatest programs to go through to get private student loans. Although federal student loans should be the first way to go, private student loans provide the money you need when the federal method isn’t providing you enough money to cover school costs.

  1. Like it was said above, private student loans provide you with the money that other financial aid isn’t covering.
  2. There are no deadlines when it comes to applying unlike most all federal student loans.
  3. Private student loans are not based on needs meaning if you have good enough credit or can provide someone with good enough credit, you will be given financial aid.
  4. The give you the freedom to pay for many things other than just tuition when it comes to your life at school.
  5. They have discounts that students can receive one their loans by doing things like, on time payments and getting your monthly payment withdrawn automatically, unlike federal student loans where discounts are found as often or at all.