Problems with consolidating student loans Free idaho phone chat
But far too often, I see major errors during this process.For example, the consolidation servicer may accidentally underfund the payoff payment to one of your loan holders, resulting in a small balance remaining on a loan that should have been entirely paid off.Or the consolidation servicer may send the “check” to the wrong company.I’ve even seen situations where the consolidation servicer – leaving the borrower with a duplicate loan balance once the consolidation loan has been issued.Or if you combine your Parent PLUS loans with your own federal student loans, you may suddenly become ineligible for some of the most beneficial student loan forgiveness and repayment programs.These errors, when made by the borrower, can be extremely difficult or impossible to undo.But if you switched majors, transferred colleges, or went on to graduate school, you may be among the 19% that owe ,000 and above, or the 5.6% who owe more than 0,000.Chances are if you’re dealing with student loan debt, you’re not just dealing with one loan. And if you couldn’t cover the costs with federal loans, you very well may have turned to a private lender, such as a bank or other lending institution (e.g., Sallie Mae) to fund the rest of your expenses.
Or if you are consolidating defaulted loans, the U. But if the balance seems way off, something may be wrong.If you’re being told that you’re not able to consolidate, and the servicer’s explanation is incomplete or nonsensical, it may be time to file a complaint or obtain outside help.Federal student loan consolidation through the Direct loan program can be great for borrowers, but be vigilant, and don’t assume it will necessarily be smooth sailing.When your consolidation loan is about to be issued, you should receive a “Summary Letter” that provides a table with all of the loans that are being included in the consolidation. All loans that you want to be included in the consolidation should be listed there.And none of the loans that you want to be (such as a Parent PLUS loan or Perkins loan) should be in that list.
This month, I’m wrapping up two cases that involved major federal student loan consolidation errors by the U. These errors were massive, complex, and entirely the borrower’s fault.