For student borrowers struggling with their loan payments, there may come a time when they feel their backs are against the wall. Student loan defaults are increasing due in part to borrowers having exhausted all other means of dealing with their debt, including income-driven repayment plans, forbearance, deferment, and student loan refinancing.
It can also be attributed to borrowers’ lack of familiarity with their legal options. Navigating the complex student loan landscape can be very daunting, even for the most informed borrowers. That may be the time to look into hiring a student loan lawyer. But, it may not always be the best option. Here’s how to determine whether you need a student loan lawyers help.
What Exactly is a Student Loan Lawyer?
Like any other type of lawyer, a student loan lawyer is a state-licensed legal practitioner held to strict standards of confidentiality and duty to their clients. They either specialize in student loan issues or have advanced knowledge about them. There are not a lot of student loan lawyers in the U.S., but in light of the growing problem of student loan defaults, it is a growing field.
A student loan attorney can represent you in any matter having to do with your federal or private student loans, including defaults, collection matters, a civil suit, negotiations with a student loan provider or administrative body, or by helping you navigate the system. At a minimum, a student loan attorney can help you analyze your debt issues and discuss possible solutions.
Student loan lawyers should not be confused with student loan consultants who are much more prevalent and active. Consultants are not state-licensed and are not accountable to any legal body. They charge for advice and offer solutions such as student loan consolidation and income-driven repayment plans which borrowers can often deal with on their own.
Do You Really Need a Student Loan Lawyer?
Although student loan lawyers can be an excellent resource and a valuable advocate to have on your side, it is recommended that you don’t rush right out and hire one. You should first do your utmost to exhaust all of your available options that don’t cost anything other than your time. If you have already taken advantage of alternative repayment plans such as income-based repayment, you should contact your student loan servicer to discuss options such as forbearance and deferment.
If you are still in a bind after taking these measures, then you could consult with a student loan lawyer about your legal options. However, before shelling out $500 to $600 for a lawyer, you could go to the National Consumer Law Center website where you can find a lot of helpful information on student loans. Low-income borrowers can seek help from their local legal services organization.
While you may not need a student loan lawyer, hiring one can be immensely useful if you need some assistance navigating a particularly tough situation. Student loan lawyers can share their expertise and offer solutions — solutions you might be able to figure out on your own, but with extensive research and a ton of time.
It may be that you simply become overwhelmed by the problem which is as good a reason as any to consult with a student loan lawyer. You will pay on average $600 for a six-hour consultation, but it may be less expensive than allowing the problem to fester and letting interest and fees accumulate. If you are threatened with wage garnishment, the cost of a lawyer may seem like a bargain. It is certainly less expensive than a student loan consultant who will charge $1,000 or more for the consultation.
The best reason to hire a student loan lawyer is when you become the target of a lawsuit and need representation for advocating your position or negotiating a settlement. That can get very expensive, but some lawyers will set up a financing plan that could fit your budget.
Know Your Options
If you don’t think you can afford a lawyer, there are several steps you can take on your own that can get you closer to a resolution. Some loan servicers have a dispute resolution department for arbitrating disputes or addressing complaints. The next step up would be the U.S. Department of Education which has an Ombudsman Group for the same purpose. You can also file a complaint with the Consumer Financial Protection Bureau which has some oversight over student loan servicing.
Author: Jeff Gitlen
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