Editorial note: We earn commissions from affiliate links on Forbes Advisor. The committees do not influence the views or evaluations of our authors.
The student loan system is complex and for many borrowers extremely confusing. How bad is the problem? Consider these facts:
- Nearly 20% of federal student loan borrowers are in default.
- Borrowers who fail to enroll in an Income Repayment Scheme (IDR) are five times more likely to default a second time.
- Federal lenders have not always been in advance with borrowers about their choices. For example, the Federal Office for Student Aid has found that Navient – one of the major lenders – has led borrowers into tolerance instead of alternative payment plans.
Many borrowers do not know what repayment options and financial hardship plans are available to them, so they run the risk of falling behind in their payments and defaulting on their debt. If you are looking for help with your student loans, you do not need to pay heavy fees. Free student loan assistance is available.
What kind of free help can you get?
If you are a student borrower, you may have problems during your repayment period — especially if you have been repaying your debt for a decade or more. Either you can not afford your payments or you are having problems applying for a loan can be frustrating to find a solution.
Some common issues that student loan agencies can help you with include:
Finding the right payment plan
If you can not afford your current monthly payments, you may be eligible for an alternative repayment plan. If you have federal student loans, you could qualify for an income-based repayment plan that determines your payments based on your discreet income and longer loan term.
There are four IDR plans to choose from and there are some slight differences between them. If you’re not sure which repayment method is best for you or how to change plans, you can find free help to talk about your options.
Assessment of suitability for loan write-off
While repaying a loan is not uncommon, there are federal loan repayment plans. If you are a teacher, civil servant, or working for a nonprofit, you could qualify for a partial or full loan write-off through the Teacher Loan Forgiveness or Public Service Loan (PSLF) programs.
Eligibility requirements for these programs are strict and require extensive documentation and documentation. Most borrowers are not sure about the requirements, which could lead to the rejection of their requests for forgiveness.
Identify options after defaulting on your debt
Failure to pay for your student loans is a serious issue with long-term consequences, ranging from a bad credit report to paying a salary. Getting out of bankruptcy is crucial to your finances, but it can be difficult to figure out if a loan consolidation or repayment loan is better.
Understanding Bankruptcy Eligibility
Historically, student loans have been almost impossible to repay in the event of bankruptcy. However, it may be possible if you follow certain procedures and you can prove that repaying your student loans would cause unjustified difficulties for you and your family. A bankruptcy lawyer or student loan lawyer can help you navigate the process.
Disputes with lenders or loan servicers
Disputes with lenders or loan officers — the companies that hire you to manage your loans — are common. According to the Office of Consumer Financial Protection (CFPB) ombudsman’s report on loansissues with lenders or services accounted for 36% of the total student loan complaints submitted.
Whether you received bad information, or because you have trouble reporting payments, or because you do not receive a response from customer service, it may be a good idea to seek help from a third party.
7 Organizations that offer free or cheap student loans
1. Student Student Loan Support Center Federal Aid
The Federal Student Aid Student Loan Support Center is a free service provided by the US Department of Education. By offering help to federal borrowers, you can contact the center for information on IDR plans, loan consolidation, or loan exit advice.
To contact Student Loan Support Centercall 800-557-7394.
2. National Credit Advisory Foundation (NFCC)
NFCC is a non-profit credit counseling company. Although its services are not free, its charges are generally low or based on a sliding scale, so you only pay for what you can afford.
Through student loan counseling services, student loan borrowers can meet with a counselor for personal, personalized assistance. Your advisor will help you get an overview of your finances, identify repayment options and create a repayment plan so you can deal with your debt.
The NFCC also provides debt management and bankruptcy counseling plans for individuals considering these options. To get started, visit NFCC.org or call 877-406-6322.
3. National Association of Consumer Advocates (NACA)
NACA is a non-profit organization with more than 1,500 members who are lawyers working for the interests of consumers. Its website provides student loan debt management information and advice on what to do if your loans are in arrears or if you are contacted by debt collectors.
If you are looking for a student loan lawyer, NACA also has one list of lawyers specializing in this area of law.
4. Student loan borrower assistance
Student Loan Assistance The project is a resource offered by the National Consumer Law Center for both federal and private student loan borrowers.
Through the website, you can get information about your loan management, the available student loan relief programs and details about your repayment options. It also has resources for more in-depth issues such as:
- Finding legal help for student loan borrowers
- Exit by default
- Call management from collection agencies
- Eligibility for student loan bankruptcy
The site is free to use, but the Student Borrower Assistance project does not manage or interfere with your loans. it just gives you the information and tools you need to manage your debt.
5. Student Loan Intermediaries
The Student Loan Ombudsman is a neutral third party that aims to resolve disputes between borrowers and student loan officers. An Ombudsman can help you with the following issues:
- Disagreements with your loan balance or payments
- Accounts incorrectly placed by default
- Understand your repayment options
- Denials of loan repayment schemes
An intermediary may not force your loan officer to take action, but if the information you provide is convincing, the intermediary may disagree with your loan officer to make the necessary changes.
Federal Borrowers Can Contact The Federal Student Aid Ombudsman Online feedback center. If you have private student loans, you can apply through the CFPB grievance center. Some states also employ their own student loan ombudsman or advocacy team. Find out if your state offers this with a quick internet search.
6. The Institute of Student Loan Counselors (TISLA)
TISLA is a non-profit organization that provides free student loan information and settlement services. Through TISLA, you can get advice on the following topics:
- Repayment of your loans
- Choice of repayment plan
- Eligibility to write off a loan
- Exit from student loan default
- Completion of necessary forms for tolerance plans or IDR
TISLA does not provide legal advice or manage your loans on your behalf. It is an information node that gives borrowers the information they need to advocate for themselves and manage their debt. Visit FreeStudentLoanAdvice.org For more information.
7. Your Lender or Loan Server
The lender or the loan officer is your main point of contact if you are having problems with your loans. If you are unable to afford your payments, need to join a different payment plan, or have questions about how your payments will be applied, you can call the Customer Service department for assistance.
If you’re not sure who your loan server is, you can log in to Federal Student Aid Website (for federal student loans) or check your credit report at AnnualCreditReport.com (for private student loans).
What to Avoid
When it comes to student loans, it is easy to feel desperate. And when someone is in financial crisis, it becomes a bigger target for scammers who claim they can offer student debt relief and instead get money. While legal aid is available for student loans, there are many fraudulent companies.
Before working with a company or paying any fees, check the company credentials. If it is not supported by the Ministry of Education or it is not a non-profit organization, proceed with caution. If the company tries to force you to sign a contract or hand over your credit card details, this is another important red mark.
In case of doubt, contact your loan servicer to see if there are options for reducing your payments or deferring your debt. The loan officer will usually be the best place to get free student loan help.