If you’ve been struggling with your Federal student loans, you are probably wondering if there is a better method to get them paid off or forgiven by the Government. While there are several different options available, they come with unique differences that you should be aware of before making a switch.
With repayments set to resume October 1st, let’s compare student loan repayment plans so you can learn about their pros and cons.
1. Refinancing
You can refinance your student loans by taking out a new loan with a private lender. The lender will pay off your current student loan and you will then make payments to that private lender. Sometimes these loans can offer a lower interest rate or an extended pay-off timeline to lower costs.However, it is important to remember that taking out a private loan will disqualify you from any current and future Federal Forgiveness program, forbearance, emergency assistance, and income-driven repayment plans. Private lenders will cancel the debt if the borrower dies. This could wind up costing you money over the life of the loan.It’s important to ask if your student loan debt passes on to your heirs. Borrowers that do not refinance and maintain their track towards Federal Forgiveness can rest easy knowing that their families are not responsible for repaying their loans. Also, Parent PLUS loans are discharged in the event of the passing of either the parent or student on whose behalf a PPL was obtained.
2. Self-Managed Program
It is possible for you to manage your student loan repayment plan on your own, but this method does require you to deal with your loan Servicer directly and handle all the initial application and all of the annual paperwork requirements.Some borrowers are eligible for a Forgiveness program through the Department of Education. After making 120 or 240 qualified payments, depending on eligibility status, Forgiveness is granted and the loan is considered paid off. This option will still require submission of paperwork annually and you will have to monitor your Servicer account carefully to ensure all payments are being applied and tracked properly by your Federal loan Servicer. Just one small mistake by your Servicer can put your eligibility at risk.
3. Student Debt Relief Companies
There are some companies that offer to manage or reduce student loans for an upfront fee. However, many of these companies will do very little after the initial enrollment paperwork is filed. You will end up paying the fee and then doing all the work yourself like a self-managed program. These companies will not track your payments or contact loan Servicers if there is an error. Be wary of these scammers who will reach out through texts or emails, making promises of loan forgiveness. If it sounds too good to be true, it probably is.
4. Student Loan Management Firms
There is also an option to hire a firm to professionally manage your student loan forgiveness program. A Student Loan Management Firm, like My Education Solutions, will file your Federal Forgiveness application, ensure renewal of paperwork, and reduce your monthly payment, providing increased savings over the life of the Student Loan Forgiveness program. The experienced Advisors at My Education Solutions are available to answer any questions or handle issues with your loan Servicer on your behalf. No more call centers and endless hold times.
100% MES Clients who have completed their required payments have received Student Loan Forgiveness from the Government.
Don’t trust your Forgiveness to a scam debt relief company. Refinancing might provide short-term help but it will disqualify you from Forgiveness and you will pay more over time. Self-managing your loans can be an option but it requires a high level of expertise, time, and paying close attention to your Servicer to avoid errors with your payments.
Hiring a professional student loan debt management firm will save you money and time. My Education Solutions is your watchdog and will handle your account every step of the way on your path to Forgiveness. Want to learn more? Speak to an experienced Advisor. Call now at 210-812-3200!
