Education loans : Your Student Loan Questions: Spousal Debt, Default, Co-Signers

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Education loans
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Your Student Loan Questions Spousal Debt,
Default, Co-Signers
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• Dealing With Default
• Q My son holds direct student loans that are in
  default. We have the ability to pay off the
  balances in full. What effects will doing so have
  on his credit reports in the future? What gets
  removed from his credit report record and what
  stays, and for how long?
• A Defaulting on a student loan comes with a
  number of potential consequences, including
  collection costs, garnishment of paychecks and
  seizure of government payments, such as tax
  refunds and Social Security. The default also
  goes on the borrower's credit history, which may
  affect his or her ability to lease a car, get a
  mortgage or qualify for additional debt down the
  line.

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• Borrowers facing this situation may benefit from
  a different strategy rehabilitation.
• When a borrower rehabilitates a federal student
  loan, he or she agrees to make nine consecutive,
  on-time reasonable payments.
• This process will remove the default line from
  the credit report altogether though the
  delinquencies that led up to the default will
  remain.
• In addition, it will lower collection costs,
  decreasing the balance you pay off thereafter.

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• Releasing a Co-Signer
• Q Is it possible for a student to release a
  parent from future liability for outstanding
  student loan debt that parent co-signed for? I
  can't imagine that a lender would agree to
  release a parent that is already committed as a
  co-signer. If this is possible, who would
  generate the paperwork?
• A When looking to close a tuition gap, many
  families turn to private student loans. As the
  student is typically young and lacking credit
  history, his or her parents often have to co-sign
  meaning they take on equal responsibility for
  the amount borrowed.

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• Tackling Spousal Debt?
• Q I have graduated. I have 120,000 in student
  loans. My husband has around 30,000 and didn't
  deal with it, so his wages are ?garnished and
  they take our tax returns. I don't want this
  problem with my loans. There is no way I can pay
  them.
• A As mentioned previously, seizure of tax
  refunds is a consequence of default one many
  borrowers are likely dealing with right now.
  Unfortunately, couples who file taxes jointly
  receive a single refund, which means the whole
  family suffers from an individual's default.
  Borrowers can take steps to get out of this
  situation. However, it's best to avoid default
  altogether.

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• Education loans come with repayment plans that
  can decrease the amount you pay each month based
  on your income and family size, and eligible
  payments can be as little as zero dollars.
  Borrowers also may be able to temporarily pause
  their payments with a deferment or forbearance.
• Ultimately, if you're facing debt you feel you
  can't handle whether it's more or less than
  120,000 contact your loan's servicer
  immediately. The servicer can talk you through
  your potential options before you fall behind on
  your payments.
• Source http//bit.ly/1XNbYcR