Tag: bankruptcy and student loan debt

Bankruptcy Law, Debt Relief, Student Loans

Homeownership Out of Reach for 400,000 Young Families Burdened with Student Loan Debt

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Student loan debt presents a major problem for many different reasons, but for 400,000 Americans in their 20s and 30s, student loan debt is now preventing them from purchasing a home. These numbers come from a new report released from the Federal Reserve, which has shown an 8.8 percentage decrease in homeownership for individuals in their 20s and 30s between the years 2005 and 2014.

Between the years 1989 and 2016, the amount of American families that carried student loan balances went from 8.9 percent to 22.4 percent according to information produced by the Fed’s Survey of Consumer Finances. For Floridians, the amount of student loan debt incurred every year has consistently been going up, as well. According to this research, the average family has a student loan debt balance of up to $19,000. The problem is what is going to happen to these young borrowers after they enter the workforce and wish to make a big purchase, such as buying a home? Will these individuals also be able to save up for retirement? According to the research from the Federal Reserve, approximately 3.6 percent of Americans between the ages of 65 and 74 are still paying on their student loan obligations.

While going to college and securing a college degree can benefit the borrower in many ways, such as securing a job in that person’s chosen career field with a better chance of earning a good income, this education almost always comes at a high cost. Students are graduating with loan balances well into five figures with no end in sight. If the student goes on to earn a graduate or professional degree after receiving his or her undergraduate degree, that balance can even reach six figures. Many researchers argue that tuition costs need to be decreased significantly to make college a less costly choice for students graduating high school. However, tuition costs only seem to be rising every year.

The study showed that the borrowers who have higher student loan debt early in life tended to have a lower credit score later. A lower credit score can hurt that person’s chances of getting a home, but also accessing other types of credit for a car purchase or acquiring a personal loan.

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For borrowers who are struggling with student loan debt, relief options are available.  Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt.  It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Student Loans, Timothy Kingcade Posts

40% of Borrowers Could Default on their Student Loans

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If you are struggling with student loan debt, you are not alone. Today, 70 percent of college students graduate with a significant amount of debt. More than 44 million Americans collectively hold nearly $1.5 trillion in student debt. That means that roughly one in four American adults are paying off student loans.

As the amount of debt has increased, so have the amount of defaults. In fact, it is estimated that around 40 percent of student loan borrowers will default on their student loan obligations by the year 2023. Student loans now make up the second largest consumer debt next to mortgage debt.

It is estimated that college graduates of the Class of 2017 walked away with nearly $40,000 in student loan debt. This figure is $3,000 more than the previous class in 2016.

Thirty-two percent of borrowers who held a balance of $5,000 or less in student loan debt defaulted at least once within four years as compared to 15 percent of borrowers defaulting who owed $35,000 in student loan debt.

The thought of paying back student loan debt can be daunting. How can you stay on top of your student loan debt to avoid falling into default? One tip is to utilize student loan consolidation, which helps you manage your student loan debt into one Direct Consolidation Loan. Another recommendation if your interest rates on your student loans are particularly high is to look into refinancing to adjust the rate to a lower amount.

When it comes to bankruptcy and student loan debt, there are some misconceptions. One being, that student loans are never dischargeable in bankruptcy. In fact, there are ways to file for bankruptcy with student loan debt.

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For borrowers who are struggling with student loan debt, relief options are available.  Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

 

Debt Relief, Student Loans, Timothy Kingcade Posts

Women Hold the Majority of Student Loan Debt

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When it comes to who holds the most student loan debt, a recent report issued by the Federal Reserve showed that women carry the highest burden. According to the Federal Reserve data, the total amount of student loan debt is now around $1.52 trillion as of March 2018. Of this amount, women carry $900 billion.

Experts believe that this number is because more women are now attending college than men. According to the American Association of University Women (AAUW), 56 percent of college enrollees in the fall 2016 semester were female. In 2017, it was reported that 57.3 percent of college enrollees were females, which indicates an upward trend.

The data also indicated that women were more likely than men to take on student loan debt. According to the AAUW data for the 2015-2016 school year, 41 percent of all female undergraduate students signed onto a new student loan debt to go to school. Only 35 percent of male undergraduate students did in comparison. Of course, the numbers varied depending on the type of degree being sought, where the student went to school and the degree levels.

Not only were more female students taking out student loan debt, but the loan balances were higher for female students. In fact, the numbers showed that the female student loan balances were 14 percent more than their male counterparts. The female students ended up with around $2,700 more in student loan debt upon graduation than their male colleagues. It could be because the female students were reported as pursuing a graduate degree after undergraduate studies were complete, which only added to their already higher balances.

The problem with these numbers is once women graduate from college, the pay gap that exists between the two genders makes it harder for them to pay off their debts. According to Pew Research, women only make 82 cents for every dollar a man makes in the workforce. Women are also more likely to take time off from their careers to have children and raise a family, only returning to the workforce after the children are grown, which also puts them at a disadvantage for catching up to their male counterparts in income and in paying off their student loan balances.

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For borrowers who are struggling with student loan debt, relief options are available.  Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt.  It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

 

 

 

Bankruptcy Law, Student Loans, Timothy Kingcade Posts

Trump Administration Making It More Difficult for Defrauded Students to Erase Debt

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The Trump Administration has taken steps to make it harder for student loan borrowers who were defrauded by for-profit colleges or universities to erase their debt. United States Department of Education Secretary, Betsy DeVos, moved to make the process more difficult for students and roll back regulations set by the Obama administration.

The Obama administration took a particularly tough stance on for-profit colleges, creating rules that allowed similar claims against for-profit universities to be processed as a group. The Obama administration also created rules that prevented colleges from requiring students to sign an agreement that required them to arbitrate disputes with the colleges.

DeVos’s statement this week made it clear that student loan borrowers will now have to prove their claims on an individual basis and will be held personally accountable for their student loan debt – even if their decision to take out the loans was based on fraudulent information.

The U.S. Department of Education is seeking comments regarding what standard should be set for students to prove their case. The previous administration had used the “preponderance of the evidence standard” to win a case regarding their obligations. However, the Trump administration is considering going to the higher burden of proof of “clear and convincing evidence.”

The Department is hoping to publish a final rule by November 1, 2018. Any loans originating after July 1, 2019, will be affected by the new rule.

Consumer advocates have argued for a more aggressive stance against for-profit colleges. These advocates worry that this proposed rule will have a chilling effect on borrowers who seek relief from student loan debt. Borrowers would need to show that the college intended to mislead or defraud them. Proving intent on the part of the for-profit college can be nearly impossible. On top of this, a higher burden of proof would make winning their cases that much harder.

The proposed rules may also give borrowers less time to apply for relief. Students have six years from the date they discover a breach of contract to file a claim. The new rule limits that length of time to three years from when the borrower leaves school. Oddly enough, this time period coincides with the time period schools have to report how many students are not making payments on their federal student loans.

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For borrowers who are struggling with student loan debt, relief options are available.  Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt.  It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.