Tag: student loan debt

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Student Loan Debt is Not Just a Millennial Problem- Baby Boomers Reportedly Struggling, too

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Student loan debt has increased eight-fold among Americans aged 60-64 over the last decade.  Moms, dads and even grandparents are shouldering more of these debts. From 2005 to 2015, the amount of student loan debt held by those ages 60-64 has increased from $4.85 billion to $38.35 billion.

For those aged 55-59, the increase is about five-fold, from $13.9 billion to $65.47 billion.  Many seniors are having trouble paying these loans off or making payments at all: 12.6% of debt held by 60- to 64-year-olds was in default at the end of 2015, a higher default rate than anyone under 40.

To make matters worse, the Trump administration is not shaping up to be particularly friendly towards people struggling to pay off these debts.  Most recently, education secretary, Betsy DeVos,  scrapped an Obama-era plan to streamline the government’s system for servicing student loans. And just this week, an education budget obtained by the Washington Post revealed a proposal to end a student loan-forgiveness program for public servants, creating uncertainty for some 400,000 borrowers.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Debt Relief, Student Loans

Public Service Student Loan Forgiveness Program- Here’s how you qualify

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The government’s Public Service Loan Forgiveness Program promises to cancel any remaining student debt for those who work government jobs or for non-profit organizations and have been making continuous payments for 10 years. The first borrowers to receive forgiveness will be eligible in October of this year, which is 10 years from the launch of the program.

Many teachers, public defenders, Peace Corps workers, and law enforcement officers may qualify for forgiveness. More than 400,000 people have applied for the program so far, but signing up for the program can be a confusing, (and not surprisingly) complicated process.

Here are 5 steps you can take to help ensure your eligibility:

  • Find out if your job qualifies. There are three different types of jobs eligible.
  1. Government jobs, which include federal, state, local and tribal government entities, as well as the military, Peace Corps and AmeriCorps positions.
  2. People who work for a 501(c)(3) non-profit.
  3. People who work for a non-profit that does not have 501(c)(3) status, but provides a public service.
  • Turn in the Employment Certification form annually. Ask your loan servicing company to certify that your employer qualifies on an annual basis and keep detailed records. Otherwise, you risk finding out that your job does not qualify after making years of payments.
  • Verify you have the right kind of loan. Only Direct Loans qualify for this forgiveness program.
  • Enroll in an income-driven repayment plan, each year. You must be enrolled in an income-driven repayment plan for at least a portion of your repayments.  These plans cap your monthly bill at a certain portion of your income.
  • Make 120 qualifying monthly payments. FedLoan Servicing will tell you how much you need to pay each month for the payment to count toward the 120 needed to receive debt forgiveness. If you pay any less, it will not count. And if you pay more, it will only count as one payment. Payments must be made no later than 15 days after the due date. Any payments you make while in school, during the six-month grace period after school, or while in deferment or forbearance do not count toward the 120.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Debt Relief, Student Loans, Timothy Kingcade Posts

New Legislation If Passed Would Allow Student Loan Debt to be Discharged in Bankruptcy

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Bipartisan legislation was introduced last week by Rep. John Delaney, D-Md., that would allow student loan debt to be discharged in bankruptcy.

The Discharge Student Loans in Bankruptcy Act (H.R. 2366) reforms federal bankruptcy rules to establish parity between student loan debt and other forms of debt. Rep. John Katko, R-New York, is the lead republican co-sponsor of the bill.

Currently, student loan debt is non-dischargeable in bankruptcy.  The only exception is if a filer can prove undue hardship, which is extremely difficult in most circumstances.  Last year, total student loan debt hit a record high of $1.3 trillion dollars.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Good News for Home Buyers with Student Loan Debt

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Mortgage lender Fannie Mae has just made significant rule changes that should make it easier for former students with costly student loan debts to purchase their first home or do a “cash-out” refinancing to pay off debt.

These new policies could be game changers for a large number of consumers. Approximately 43 million Americans are carrying student loan debt, totaling $1.4 trillion nationwide. Costly student loan debt not only impedes on borrowers’ ability to save money for a down payment, but it is also a key reason why so many young, potential home buyers remain renters or are living with their parents.

Below are three big changes that Fannie Mae has made that could affect you:

  • If you’re one of the 5 million borrowers who participate in federal-reduced payment plans on your student loan, your actual monthly payments, as reported to the credit bureaus, will count toward your debt-to-income (DTI) ratio calculations. For example, if your payments were originally supposed to be $500 a month but you have had them reduced to $100 through an income-based repayment plan, only the $100 will be added to your monthly debts for DTI purposes. Previously, lenders were required to factor in one percent of your student loan balance as your monthly payment on the student loan, even though you were actually paying a fraction of that.
  • For an estimated 8.5 million American homeowners who are still carrying student debt, Fannie Mae has lowered the costs of a “cash out” refinancing, provided the extra cash you pull out from your equity is used to retire your student debt. Among the potential beneficiaries: parents participating in “parent plus” programs that help pay off their kids’ student loan debts, and parents who have co-signed for their children’s student loans. Fannie is eliminating the usual extra fee it charges for cash-outs, as long as the funds that borrowers withdraw pay off student loan debts.
  • If you have nonmortgage debts that are being paid for by someone else such as your parents, these will no longer be included in your DTI computation, provided the payments have been made steadily for 12 months. This should improve the DTI ratios of young buyers who are still getting a little help from their parents.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Millennials owe a Record Amount of Debt

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Millennials (also known as Generation Y), those 21 to 34-year-old hold an estimated $1.1 trillion of the country’s $3.6 trillion in consumer debt.  Rising student and auto loans are outweighing a decline in mortgages.

With all of the rising debt comes the risk of default.  There is evidence that millennials are curbing their spending habits when it comes to smaller purchases, whether searching for the lowest price or waiting for the best time to buy.

But concerns over student loans and auto loans remain.  A growing amount of auto loan debt comes from leasing, with 32% of millennials choosing to lease in 2016, up from 21% in 2011, according to a report from Edmunds.  Households making $50,000 or less, millenials made up 21% of lessees.

If millennials pay their student loans over their auto loans, lower-credit-score applicants could have a hard time financing vehicle purchases.  If that happens, automakers could be in trouble.

Click here to read more on this story.

If you are in financial crisis and considering filing for bankruptcy, 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, P.A. 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 website at www.miamibankruptcy.com.

 

 

Bankruptcy Law, Debt Relief, Student Loans, Timothy Kingcade Posts

Class Action Lawsuit May Offer Hope to Student Loan Borrowers in Bankruptcy

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Student loan servicer, Navient has agreed to stop collection attempts on certain borrowers who filed for bankruptcy, providing at least temporary relief for thousands of people and signaling there may be a chance of discharging student loan debt in bankruptcy.

As part of an ongoing class-action lawsuit, Navient has voluntarily agreed to stop collection activities on loans used by borrowers who filed for bankruptcy after October 2005 and used the loans to attend non-accredited schools.

Under the voluntary agreement filed with the court this month, Navient can still continue to send borrowers monthly statements, but the company will no longer aggressively call borrowers multiple times a day.

Plaintiffs in the case allege Navient attempted to collect on loans that were discharged in bankruptcy, including calling their relatives and employers multiple times a day.

The judge overseeing the class-action has not made a ruling yet, so it is unclear if he believes the debts should be discharged. But in a hearing to discuss whether Navient would stop collection on the loans at issue in the case, he pushed the company to do so, expressing sympathy for the borrowers.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Debt Relief, Student Loans, Timothy Kingcade Posts

Student Loan Forgiveness Letters May be Invalid

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More than 550,000 student loan borrowers who signed up for a federal program that promised to repay their student loans after they work 10 years in a public service job may be invalid, according to the Department of Education.

In a court filing last week, the Education Department suggested that borrowers could not rely on the program’s administrator to say accurately whether they qualify for student loan debt forgiveness. Even more appalling, the thousands of approval letters sent out by FedLoan Servicing are considered to be non-binding and can be rescinded at any time.

The filing adds to questions and concerns about the student loan forgiveness program, which offered major benefits and incentives for student loan borrowers who took public service jobs instead of more lucrative work in the private sector.

The American Bar Association and several borrowers have filed suit in the U.S. District Court in Washington against the department.  The plaintiffs in the case held jobs that they initially were told qualified for the debt forgiveness program; only later to find out the decision was reversed. The lawsuit seeks to have their eligibility for the forgiveness program reinstated.

The student loan debt forgiveness program covers people with federal student loans who work for 10 years at a government or nonprofit organization, and includes public school employees, museum workers, doctors at public hospitals and firefighters. The federal government approved the program back in 2007.  The first potential beneficiaries of the program reach the end of their 10-year commitment this October.

Approximately 25 percent of the nation’s workforce may qualify for the program, according to the Consumer Financial Protection Bureau.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

The New Shape of U.S. Household Debt

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Household debt in America has been reshaped in ways that could potentially affect how financial experts are able to help manage a consumer’s liabilities. The overall debt of U.S. households is $100 billion smaller than it was in 2008. According to the Federal Reserve Bank of New York, it also looks a lot different now than it did then.

Mortgage debt remains the largest debt burden. However, its share of household debt has declined along with that of credit card debt, while the share of student loan debt and auto loan debt has grown.

By the end of 2016, mortgage debt accounted for 71 percent of household debt, down from almost 79 percent in 2008. Student debt had more than doubled since 2008 and more than tripled since 2003 to 10.4 percent.

Auto loan debt had a 9.2 percent share at the end of 2016, which is approximately one-third larger than it was in 2008. All three types of debt had larger shares of households’ income than credit card debt.

All of this means that housing debt fell $1 billion from its peak in 2008 of $9 trillion, while student loan debt rose $700 billion and auto debt rose $350 billion.

Financial experts attribute the change in household debt to a change in the demographics of U.S. debt. Households that are headed by those 60 years old and older now account for just over 22 percent of outstanding U.S. debt, which is up from 16 percent in 2008.

Click here to read more on this story.

If you are in financial crisis and considering filing for bankruptcy, 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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Student Loans ‘Designed to Fail’: States Say Navient Preyed on Students

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Navient, a student loan lender that split off from Sallie Mae in 2014, retained nearly all of the company’s loan portfolio. In recent months, Navient has come under fire for aggressive and sloppy loan collection practices, leading the government to file multiple lawsuits against the student loan giant in January.

However, those accusations have overshadowed broader claims made against the lender. Two separate states, Illinois and Washington, have filed lawsuits against Sallie Mae claiming that it engaged in predatory lending, extending billions of dollars in private loans to students.

“These loans were designed to fail,” said Shannon Smith, chief of the consumer protection division at the Washington State attorney general’s office.

New details emerged last month in the lawsuits against Navient that shed light on how Sallie Mae used private subprime loans, some of which it expected to default at rates as high as 92 percent, as a tool to build its business relationships with colleges and universities across the company.

The risky loans were detrimental for students, however; they were beneficial for Sallie Mae. The private loans were a “baited hook” as Sallie Mae described it. The lender used the private loans to reel in more federally guaranteed loans, according to the lawsuit.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

The IRS Has Hired a Debt Collector That is Being Sued by The Government

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The IRS has hired for-profit debt collectors to collect on long-overdue taxes that the government lacks the resources to work on. Four debt collectors were selected for the new contracts, including one whose parent company is currently being sued by the U.S. government over its student loan debt collection practices.

Pioneer Credit Recovery is a subsidiary of Navient, a student loan debt collector. The Consumer Financial Protection Bureau filed a lawsuit against both companies in January claiming that the companies “systematically misled consumers.” A few months prior, Pioneer was selected as one of the IRS debt collection contacts in September, alongside ConServe, Performant and CBE Group.

Pioneer’s parent company Navient, formerly known as Sallie Mae, holds a federal government contract to service approximately $300 billion in student loans owed by 12 million borrowers.

The IRS was mandated by Congress to hire debt collectors, in language that was inserted into a $205 billion highway funding bill in late 2015. Experts on consumer protection say the new contracts create more potential for bad behavior in debt collection.

Click here to read more on this story.

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, P.A. 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 website at www.miamibankruptcy.com.