Student loan relief can be found, but not from ‘debt demons’
What led Woodward and Bernstein to discover the secrets of the Watergate Scandal was the Deep Throat admonishment to “Follow the money.” Today, one of the most scandalous activities the country is witnessing may be the proliferation of student loan settlement companies. And if you want to know why that is, all you have to do is remember Deep Throat’s advice.
According to the widely reported estimates, student loan debt represents a veritable deluge of financial concern for the country. Some 40 million Americans are said to owe a total of around $1.2 trillion. The people of Atlanta certainly are not immune.
With that kind of debt generating huge levels of anxiety, is it any wonder that there is a growing flock of operations offering student loan settlement services?
The problem with these companies, which one Forbes pundit describes as debt demons, was made clear recently in two lawsuits filed by the attorney general of Illinois. She alleges that such companies engage in deceptive practices. They often charge unsuspecting loan holders hundreds of dollars up front for services that could be obtained for free through government programs. But worse than that, after collecting the money, they often don’t deliver any services at all.
According to the Forbes writer, the Illinois Attorney General’s Office is the only one in the country taking action to counter illegal elements of the student loan settlement industry. That might lead some to think that there are few alternatives to address the issue, but that would be the wrong conclusion to draw.
It is true that student loan debt can’t be discharged through bankruptcy, except in severe hardship circumstances. But filing bankruptcy may allow you to either consolidate payments or discharge other unsecured debt, freeing up funds that can be applied to the student loans.
To explore and understand all options, it’s best to consult an experienced attorney.
Source: Forbes, “Debt Demons Discover Student Debt,” John Wasik, July 16, 2014