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Government cracks down on more student loan defaulters

Created: On May 6, 2011 @ 4:49 pm In

The government is going after more student loan defaulters and suing to recover the money. The Education Department referred 5,393 loan defaults to the Justice Department last year, compared with 2,596 in 2009, according to [1] USA Today. There were 918 referrals in 2006.

Too much debt

Many people who used student loans to pay for college have found themselves struggling to pay the bills along with credit card debt and other financial obligations. In many cases defaulters go for years with unpaid loans without the government coming after them. But now the government is filing lawsuits against more people with large amounts of unpaid debt.

“The most important thing to remember is we want the loans repaid,” Education Department Spokesman Jane Glickman told USA Today. “Borrowers can work on repayment plans ranging from deferments to extended grace periods. We try to do everything possible to come up with a repayment plan before taking the step of seeking a lawsuit.”

Ask for help with debt

If you find yourself juggling too many student loans, here are four things to try to get help with debt:

  1. Contact your student loan company and ask for [2] debt help. Avoiding the problem will only make it worse.
  2. Ask for a loan deferment, which would allow you to postpone repaying it for a period of time. Depending upon the type of loan, you may still have to make interest payments.
  3. Ask for forbearance on a loan. This would allow you to suspend or reduce loan payments for a period of time. Interest would continue to accrue during the forbearance.
  4. Look for l[3] oan forgiveness programs if you work in select fields in certain types of communities, such as medicine, teaching or the military. Read through program guidelines carefully to determine eligibility.

Get help with student loan debt before it gets out of control and you end up defaulting. Also remember that having larger amounts of debt could also increase the odds of a lawsuit being filed against you.

Article printed from DebtHelp.com Blog: http://www.debthelp.com/blog

URL to article: http://www.debthelp.com/blog/2011/05/06/government-cracks-down-on-more-student-loan-defaulters/

URLs in this post:
[1] USA Today: http://www.usatoday.com/money/economy/2011-05-02-feds-sue-over-student-loans_n.htm
[2] debt help: http://www.debthelp.com//
[3] oan forgiveness programs: http://www.finaid.org/loans/forgiveness.phtml