Published on April 24th, 2018
If you are overburdened with ever-rising debt, you are surely not the only one. Over one out of seven federal student loan borrowers are known to be defaulting within just three years of initiating repayment.
These statistics are not relevant to private student loans. If you are stuck with colossal student loans which cannot be paid back, an effective debt settlement could be the perfect answer to the issue. However, federal student loan debts are rarely settled but a settlement could be achieved if planned wisely.
When Can You Pursue Debt Settlement?
You could initiate the debt settlement process only after you have been defaulting and once the collection process has actually started before any legal action has been taken.
A loan settlement is certainly not same as discharge or forgiveness, where your federal student loan balance would be canceled under certain special circumstances. This is not similar to an amendment plan or refinance.
With debt settlement, your creditor would strike a deal for debt settlement with a lower amount as compared to the sum actually borrowed. It would mean resolution of your student loan debt without necessitating collections, or even court judgments. Browse through debt settlement reviews for more detailed information and effective solutions.
When Can’t You Pursue Debt Settlement?
In several cases, you would find that student loan debt cannot be settled. Check out the following conditions when you cannot qualify for a federal student loan debt settlement. If any of these are applicable to you, then debt settlement is not for you in this case.
You Have Been Defaulting Purposely To Settle Debts
Strategic default is regarded as fraud and you may fall into much bigger issues. By defaulting strategically, you are compelling your lenders to settle.
If you are intentionally holding off the repayments and becoming delinquent with the purpose of going into default intentionally, you would no longer have the option of debt settlement, you would owe your entire debt balance and interests would be continuing to accrue.
The Court Has Already Passed A Judgment Against You
If lawsuits have already been filed against you, judgments have been filed, and you have been asked to pay off your debts to the lender, you cannot request debt settlement anymore.
You Have Accumulated An Impressive Amount Of Money
As per financial specialists, lenders would not agree to give debt settlement approval if there is enough cash with you to make the full loan payments. For instance, you seem to have received an impressive inheritance amount or won a lottery, or maybe got a massive