subject: Counseling Debt Settlement - Finding the Best Debt Settlement Strategy to Pay Back Student Loans [print this page] Counseling Debt Settlement - Finding the Best Debt Settlement Strategy to Pay Back Student Loans
Usually loans are provided to students without having any assets tied up to their loan. This type of loan is called as unsecured loan. It is important for every one of us to maintain a good credit history by repaying the debt on time. But, there might be situations which might make students not pay their loans regularly on time. At this stage, students have to consider the best debt relief options to get relief from their debt.
There are various student loan forgiveness programs provided by the government. To qualify for these programs, student might have to perform one of the following:
- Perform some voluntary work
- Perform a military service
- Should teach or practice medicine in certain communities.
If students get disqualified from the above program, then they might have to choose debt relief policies like bankruptcy or debt settlement.
If student is not sure on how to deal with his unsecured debts then they can contact the counseling services to get relief from debt.
These counseling companies do not charge any upfront payments from the students before the actual settlement. If counseling companies charge any fees upfront, students have all rights to lodge a complaint with the government.
If the settlement process is not successful, then students might not even pay any amount for counseling services.
Students might also directly go for debt settlement process without any professional help. This option is only available if the unsecured debt is more than $10k. In this process, negotiations are carried out between the student and the creditor to finalize the settlement amount. The final settled amount might get reduced up to 60% from the total debt. In this approach both student and the creditor get benefited.
Another option available to clear debt is bankruptcy. Usually this process might take a year of court proceedings. Bankruptcy also ruins your credit score which in turn makes it difficult to find a new job or a loan.
The most viable option for a student is to go for debt settlement process to get free from bankruptcy.
Debt settlement is a legitimate alternative to filing bankruptcy. Consumers can expect to eliminate around 50% of their unsecured debt with the help of a legitimate settlement program. With the new FTC laws recently passed in July 2010, debt settlement is a much less risky option. If they don't settle your balance you don't have to pay a dime.
Check out the following link for free help from a certified debt relief specialist:
