The Complex Student Loan Environment- Dispelling Myths

America is fundamentally misunderstanding Federal Student Loan debt. We at our organization, have been looking at news stories, articles and interviews that are intrinsically missing the mark when it comes the primary reasons that Federal Student Loan debt has become such a problematic financial instrument. So let's take some time to look at the space as a whole and help dispel 3 myths and/or rumors. As time goes on we will post more and more discussing this complex environment. But for now let's start with the basics.

• Student Loan Debt has been increasing exponentially over the years. (1.6 Trillion now- up .2 trillion from the previous semester)
• The public is largely misinformed about how to deal with their debt and why it's so difficult to get favorable results.
• Some (NOT ALL!) third-party Student Loan Forgiveness companies are SCAMS

As evidenced in the CNN article above you'll see the conjecture is generally something like:

Everyone is has Student Loans - everyone can't pay them back, its a mystery and there's nothing anyone can do about it!

RIGHT?

WRONG!

The proper help is not out of reach- but you do have to understand the space a little bit more.

Myth #1: It's the Governments fault.

First off- it's NOT the Federal Government proper that is failing to do their job with regard to servicing your debt. Generally speaking, in our experience it is your loan servicer that is failing or "defrauding" the borrower. I put that in quotes because depending on your position in the fight, determines how you feel about whether or not it's defrauding. More on that in later articles. I'm going to repeat that. So far as we can tell IT'S NOT THE GOVERNMENT.

Follow the money- right? Who benefits or stands to benefit financially from a Student Loan debt? Your Federal Loan servicer. There aren't many of them- some better than others- some completely inept. You can find a list of them here. There are only a few worth doting over. However, the important take-away is that it's THEM not the government getting in the way of your Loan Forgiveness.

Myth #2: Student Loan Forgiveness isn't real- at the end I will still have to pay!

Similar to #1 - Student Loan Forgiveness is REAL however, it's availability and efficacy is being hindered by the servicers. One of the most prevalent problems we have encountered through clients and have seen in articles is that people were promised forgiveness and never received it. You can see an example article here. Then once again, they blamed the Feds/DOE instead of identifying the real problems. The reality is however, that people failed to do a number of different things:

1. Enroll in a Loan Forgiveness program
2. Make sure you're receiving Forgiveness Credits
3. Be enrolled in the proper repayment program
4. Have the right TYPE of Federal Student Loan
5. Be with the proper servicer
6. Re-certify every year on-time

If you have been making payments or think you've been making payments into this program it is absolutely paramount that you speak with a specialist to ensure you are receiving your credit. Whenever filing with the Federal or State government it's super important to make sure all of your ducks are in a row. That goes for medicaid, medicare and/or any other type of Federal or State program. ONE MISTAKE- and the form is invalid and you have to start over- which is not only lengthy but costly at times.

Myth #3: Third Party Student Loan Companies are all SCAMS

Contrary to popular knowledge or belief, there are 3rd party student loan assistance companies that can help you with your Federal (and sometimes private) Student Loan Debt. There are some advantages to working with these companies and there are definitely tell tale signs that some are scams. The scam companies or I should say "less comprehensive" companies tend to have certain things in common that make it obvious you are not getting the best or most suitable deal for yourself. Let's identify some scam tactics and highlight conceptually what to look out for as well as how to spot integrity in this space.

SOUNDS LIKE A SCAM....

1. Claiming they will now be your servicer and/or are taking over your debt.
2. Claiming that you will be making your Federal Student Loan payments to them- not your lender.
3. Charging you in perpetuity or for a lengthy period of time.
4. Most scam companies will do nothing more than consolidate you- if they do so at all. Forget getting loan forgiveness or anything remotely more complicated.
5. Not willing to provide you or never provided you with a copy of your signed agreement regarding services rendered.
6. Never shown you proof of recertification or forgiveness credits.

FACTS:

1. A Federal Student Loan Forgiveness company is similar to a Tax Preparer in that they are NOT the IRS but are particularly adept at filing your forms with the government. Perhaps they should or ought to be designated as such: i.e. Student Loan Repayment Preparer or something but as of now- no such designation exists.
2. They are not nor should they claim they are your servicer or they are "taking over" your debt. They are simply preparing your forms and acting as a concierge between you and your servicer.
3. The best companies try to solve or submit your file as complete as possible with as many programs or entitlements taken care of in the first filing or early on in your program to get you the maximum benefit.
4. These companies if legit will usually charge you a one time fee. They may break it up into multiple payments for your convenience but they will NOT be charging you for over a year or as long as 36-60 months. Honestly- that's just ridiculous. Most of the services we perform are taken care of in usually 30-90 days or in the case of default under a 12 month period.
5. The agreement that you're being asked to sign ought to be presented to you as well as reflect the terms that were discussed at the time of your signing. You should most certainly be provided with a copy after you've signed- especially if requested.
6. As a general rule of thumb- these companies should be within the United States so you're not getting a cold call saying your Social Security Number has expired!
7. You will be asked to share sensitive information but you should get some assurances that it will not be shared and is encrypted once saved. (Nota bene: most debt software encrypts sensitive data once the user clicks save)

To summarize and make it easier, there is help! Of course you can contact your servicer- but thus far that generally hasn't been working out for you, me or anyone. That's because they OWN YOUR DEBT. We at 4Givr and The Student Debt Forgiveness Network do not. We work for you and on your behalf to get you the most suitable deal possible from the Feds. Reach out and let us help you today. Be sure to find us on the web and social media. Comment- complain- argue- battle- share- BUT GET THE WORD OUT. There is help. You do not have to suffer.

Fill out an application and get the help you need today!

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