ROHNERT PARK, Calif., May 18, 2018 – Defaulting on federal student loans is a big deal. Though getting out of default can be considered a new start, collection agencies can make repayment even more difficult than before default by adding exorbitant fees to the balance. At a time when repayment needs to be easier for struggling borrowers, those collection fees can push monthly payments even further out of reach. Ameritech Financial, a document preparation company that helps federal student loan borrowers apply for federal repayment plans, reminds any borrower struggling to make payments that income-driven repayment programs might provide some relief.
“Borrowers who can't afford their payments for long enough might walk away from default with even higher amounts due,” said Tom Knickerbocker, executive vice president of Ameritech Financial.
After 270 days of failing to make a payment, federal student loans will default and be sent to a collection agency. The Department of Education contracts with several private collection agencies for student loans and such agencies can charge borrowers fees that get added to their balance. There are a couple of ways to get out of student loan default that don't involve simply paying the balance in full. However, the fees accrued during default will remain a part of the balance owed by the borrower even after a borrower gets out of default and is current on his or her loans.
Some states are considering legislation that might help defaulted borrowers. Unfortunately, many borrowers must help themselves. However, previously defaulted borrowers are at high risk of defaulting again. It is essential that borrowers can transition out of default into an affordable repayment plan. Ameritech Financial reminds such borrowers that federal income-driven repayment plans (IDRs) can potentially reduce payments relative to income and family size. While certain borrowers enjoy IDR payments as low as zero, other borrowers may be more likely to stay current on their loans and avoid default when enrolled in an IDR.
“We believe that default is preventable for most situations as long as borrowers have the right support,” said Knickerbocker. “At Ameritech Financial, we help borrowers understand and apply for IDRs that are intended to prevent default even for borrowers who struggle the most with payments.”
About Ameritech Financial
Ameritech Financial is a private company located in Rohnert Park, California. Ameritech Financial has already helped thousands of consumers with financial analysis and student loan document preparation to apply for federal student loan repayment programs offered through the Department of Education.
Each Ameritech Financial telephone representative has received the Certified Student Loan Professional certification through the International Association of Professional Debt Arbitrators (IAPDA).
Ameritech Financial prides itself on its exceptional customer service.
To learn more about Ameritech Financial, please contact:
5789 State Farm Drive #265
Rohnert Park, CA 94928
Student Loan Default and Income-Driven Repayment
SOURCE Ameritech Financial
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