Articles Posted in Student Loans

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When consumers are dealing with National Collegiate Student Loan Trust (NCSLT), the question comes up, “Which collection firms sue for these guys?”

There are two law firms that we typically see representing Nation Collegiate Loan Trust in Alabama.

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Adam Minsky, student loan attorney in Boston, has an important post about a recent 7th Circuit Court of Appeals decision that allows the discharge of a federal student loan.

Adam writes:

A new decision issued by the 7th Circuit Court of Appeals could potentially change this. In Krieger v. Educational Credit Management Corporation, the court upheld a bankruptcy judge’s decision to allow a borrower to discharge $25,000 of federal student loans in bankruptcy. The court concluded that the borrower, a 53 year-old paralegal, had made reasonable good-faith attempts to repay the loan. The court also noted that she was destitute, lived in a rural area and had difficulty finding suitable employment, was a caregiver for her elderly mother, and lacked the resources to look for suitable work elsewhere (no internet, unreliable transportation). The court concluded that the bankruptcy judge had discretion to determine whether the borrower met the “undue hardship” standard, and that this standard should not serve as a blanket prohibition on discharging student loans in bankruptcy.

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The Student Loan Borrower Assistance website (which has a wealth of information by the way) has an excellent post on the initial collection tactics by the Department of Education that could be changed to give federal student loan borrowers a chance at repaying their obligations.

Instead of, for example, telling borrowers that must immediately repay tens of thousands of dollars, why not tell borrowers about their federal rights to various types of repayment programs and deferments that could prevent their student loan from going into default.

[If your loan goes into default, remember there are differences in federal and private student loan collection powers.]

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Adam Minsky has an excellent post at his Boston Student Loan Lawyer blog about the increasing number of law school graduates, the high amount of student loans, and the shrinking of available jobs.

As Adam concludes:

The Bureau of Labor Statistics has come out with a new report on projections for attorney job openings. Right now, law schools are churning out more than twice the number of graduates than there are available attorney jobs. Based on these projections, within ten years there might be a quarter million lawyers who cannot practice law-and most of them will have a mountain of student loan debt to grapple with. Something’s gotta change, no?

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Citibank and the Student Loan Corporation have settled a multi million dollar lawsuit related to interest rate violations of the Servicemembers’ Civil Relief Act (SCRA).

Read the good article by Karen Jowers but here’s the gist:

Olson began her active duty in 2005. She later informed Citibank (New York State) of her active-duty status, asking to have her interest rate on her student loan reduced to 6 percent. The Servicemembers’ Civil Relief Act requires lenders to reduce interest rates to 6 percent on loans that were entered into before a service member goes on active duty, as long as the service member provides notification and is materially affected by being called to active duty.

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This is a few months old but very much worth your time if you, or family members, have student loans. It is a report put out by the National Consumer Law Center’s Student Loan Borrower Assistance Project.

Take a look at it as it will give you a lot of good background information as well as some initiatives and proposals being put forth in the area of student loans.

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We have talked about how bankruptcy is very limited when dealing with any type of student loan — even private student loans with a bank.

Here is an article discussing an effort by the Consumer Financial Protection Bureau and, surprisingly, the Department of Education to open up more options to discharge a private student loan in bankruptcy.

Many people, old and young, are trapped by student loan they can never pay off. Federal student loans do have some options and protections but with private student loans it is the same as a credit card. Except you can very rarely get a bankruptcy discharge.

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One of the best places to start when looking at your student loan issue is exactly what does the National Student Loan Data System (NSLDS) show about your loans which is why we wrote a short article explaining how to access this site.

Find out where you are right now on your student loans and then you can plan for where you need to go next.

This is especially true when dealing with student loan collection issues — sometimes it can be very confusing on which loan is being collected upon by which collection agency.

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