Most of my Houston student loan clients have federal loans, and often with a little coaching, they can handle resolving their federal student loan problems themselves. And that's good, because the Dept. of Education has the power to administratively garnish your wages, even in Texas, and intercept your income tax refunds.
But private student loans are another matter. Negotiating a settlement with a delinquent student loan creditor can be impossible. They just want too much money, more than my clients can afford to pay. What makes it worse, is that many times private student loans are co-signed by a parent or other relative, so they can try to collect from them, too. They can even sue to collect private student loans, and it is getting more common for them to file lawsuits.
Senator Elizabeth Warren is shown in this video, questioning a private student loan industry representative, about why they don't offer more affordable repayment options. She is a real fighter for consumers.
Good for her, maybe if enough pressure is brought on this industry, they will do something. Or, maybe it's time for Congress to change the Bankruptcy Code so that these loans are again dischargeable in bankruptcy, as they were prior to 2005.
If there is no other option, filing chapter 13 can stop student loan creditors from bothering you, and let you pay an amount that you can afford.
And with chapter 13, there is a co-debtor stay, so that the debt collectors cannot bother your co-signers either, all the time that you are in the plan, which can be from 3 to 5 years. Call our office anytime at 713-772-8037 for an appointment with one of our attorneys, and we will be happy to explain how to get protection from your creditors, including your student loan creditors.