Student Loan Settlement and the Negotiations Made for This

The federal student loans are those kinds of student loans that can benefit most the student borrowers, with several repayment schemes they can avail of, and all of these to their benefits, according to the student loan expert Thomas Caufmann. However, it may not be all good times for the borrower and financial troubles may set in. When this time comes, loan delinquency may happen and defaults may also come. This situation will bring more troubles to the student borrower, but there is also a solution to this, like when the borrower has a good sum of money for paying the student loans. The sum of money can be from family or from other sources, but there is loan settlement that the student borrower can avail of.

According to Thomas Caufmann, the recognized expert on student loan management and consolidation, there is loan settlement or compromise that can be availed of. The purpose of this loan settlement is to get one that is discounted or the lower amount for payment of the student loan. It may be hard to get this, but also not impossible to do. What is needed is for the student borrower to talk and negotiate with the loan company, and there can be the loan settlement that is approved. Good negotiating skills are needed here, but the student borrower can also ask for help in this situation, like seeking the help of the experts.

Per Thomas Caufmann, there is settlement that can be done, like the standard compromised settlement that is not a negotiated settlement. The student borrower can go for the settlement that is lower than the full amount of the student loan and this is already fully liquidated. Collection charges can be waived and the total amount for payment is definitely lower, but the full amount of the loan principal and interest are paid. The settlement can also be fifty percent of the total interest paid and the loan principal and charges also paid. The settlement can also be for paying ninety percent of the principal and interests and there is a savings of 10 percent.

All of these types of student loan settlements can really give a good amount of savings for the borrower, but the payment is also in lump sum. For the loan amount that is left out in the settlement, there can be consequences for this like a tax imposed. The huge sum involved may be hard to acquire and for this reason, student borrowers should not let the student loan go into default or consequences can result. When there is already loan default happening, wage garnishment can happen, and this can be hard for the borrower because loan providers don’t need court orders for this. Other benefits can also be garnished, like Social Security benefits and also tax refunds of the borrower.

According to Thomas Caufmann, the student loan expert, borrowers should not let the student loan go into default, and there are several strategies like repayment schemes that can be availed of, and the student borrower will no longer meet more financial troubles with the student loan debts.  There can be loan consolidation that can help because repayment amounts are already low, or repayment schemes that are with affordable repayment amounts, like the income based repayment scheme. What is needed is just for the student borrower to talk with the loan servicer or provider and negotiate for whatever scheme that can help.

What is important in this situation is for the student borrower to seek the loan collector and loan servicer and talk and negotiate about the federal student loan availed of. However, the borrower should not wait for the student loan to go on default or things will not go his or her way. Good negotiating skills are needed in this situation, according to the expert Thomas Caufmann.