Consoildating private education loans
College is expensive, and the costs seem to keep going up. Department of Education offers both grants and loans with low and fixed interest rates with flexible repayment plans.Students are exploring more and more ways to fund these ballooning costs for their higher education. When seeking financial aid, your first step should be to exhaust all forms of scholarship and grant money you may be eligible for. You will need to fill out a Free Application for Federal Student Aid (FAFSA) in order to determine how much aid you may qualify for through government funding.This means that you are not required to pay them off in full through your Chapter 13 repayment plan.Student loans receive a pro-rata share of the total amount paid to unsecured creditors in your plan (this amount depends on your income and expenses).
Private student loans can also have an origination fee attached to them on top of the interest rates and principal amount of the loan.Unfortunately, many times grants, scholarships, and federal loans are just not enough to cover the costs of college, and you will need private student loans to bridge the gap. Private student loans are made by a lender, such as your school, state agency, bank, credit union, or other financial institution.In addition, federal funding is not available for non-U. These loans are unsubsidized, meaning you pay the interest yourself. Variable interest means that as the market changes, so does the amount of interest you are responsible to pay.Private Education Loans, also known as Alternative loans are educational loan programs established by private lenders to supplement the funding that students and parents receive from federal and state sources.Private loans often have different lending criteria than government lending programs. Students may need to obtain a co-signer to qualify for the loan.
Read on to learn more about how Chapter 13 bankruptcy can help you manage your student loan debt. Generally, the only way to discharge student loans through bankruptcy is to prove that paying them back is an “undue hardship” for you.