Getting Ride of Your Student Loan
With college fees rising up & Business schools becoming expensive, professional education is becoming more and dearer with each passing day. Hence students opt to take education loans either for a complete degree or on a semester basis. It has been noticed that managing the repayment of education loan is difficult at times for the passed out students. A survey shows that there are many cases when the education loan payment exceeds their original cost. One can opt for forbearance or deferment but anyway the loan has to be repaid since these options are only temporary solutions. They do not close down the loan.
Unlike other debts, student loan is not discharged if one declares bankruptcy, so the individual still holds the liability to pay off the student loan. Disposing of the education loan is necessary to fetch other loans in future. Because default of a loan is a bad option one can opt for as it will tarnish the financial records of the individual that will absolutely bar that person to get any loans for future usage. But there are certain methods by which one can legally dispose off the debts or take them off from your financial records.
The details of the method are briefed below:
- When the debtor is dead or 100% disabled then the debtors or their heirs are not liable to pay off the student loan. It is necessary that the debtor’s family has the information about the fact that the student loan gets waived off in case the debtors dies suddenly. Otherwise if the debtor has faced an accident or facing a long term illness which does not allow him or her to work then also the loan gets discharged as per certain guidelines.
- In case the education institution closes before the debtor’s course or degree is complete, then the debtor does not stand responsible to pay off the loan. The loan stands cancelled fully and his or her credit report becomes clean
- The debtors can enroll in Peace Corps VISTA or can teach in a low income school for five years who are paid in nuts for teaching. Above this, these schools or Peace Corps provides you with a pay of 15% of the loaned amount each year as part of the program. This 15% directly goes to the loan agency hence there is part pay off of the loan. So the debtor can have some peace of mind.
- Though student loan is not dischargeable if one declares bankruptcy but one can request for a special “hardship hearing” where one can explain to the judge that repaying the debt would become an undue hardship on you. Only a small percentage of debtors get waiver through this mode.
- If one can prove that the school or college they have passed out have done a “False Certification” by saying that the course or the degree will benefit the individual but the promises are being fraudulent then one can get their loan discharged under certain guidelines.