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Upon leaving college, many students enter the school of hard knocks. They discover how difficult it is to earn enough money to meet their student loan obligations, typically ranging from $20,000-$50,000. Since most student loan debt cannot be discharged through personal bankruptcy, things quickly go from bad to worse.
In fact, U.S. Department of Education statistics indicate that over 11 percent of student loans are currently in default compared to only five percent in 2001. Most of this increase occurred since 2007, largely due to the tight job market and high unemployment plaguing recent college graduates.
Negative consequences of student loan default
Nine months after you leave college, your student loan payments come due. If you do not pay as agreed, your loan soon goes into default. The U.S. Department of Education defines default as failing to make loan payments for 270 consecutive days within two years of leaving school.
Here are some of the painful consequences that follow missed student loan payments:
Steps you can take to remedy the situation
The following strategies are just some of the options graduates in default can consider:
Whether you are in Dallas, Richardson, Plano, or elsewhere in Texas, it is important to reach out to the lenders and take decisive action to limit the damage when it becomes tough to repay your debts.
If you are having trouble paying your bills and saddled with calls from creditors, the Lonergan Law Firm, PLLC can help determine if bankruptcy is right for you. To learn more about the bankruptcy services we offer in the Dallas-Fort Worth area, including Richardson and Plano TX, contact a Dallas bankruptcy lawyer today.