Federal Judge Rules Against Betsy DeVos in Student Loan Forgiveness Case

Written by adminSeptember 14, 2018
Student Loan Consolidation

It was only a few days ago that Financial Helpers reported on this developing Education Secretary Betsy DeVos story. She, along with the Trump administration, was purposely keeping students from obtaining student loan forgiveness. This is in direct violation of an Obama-era law that offered amnesty in the event of for-profit scams and fraud.

Instead of offering full student loan forgiveness, DeVos was in favor of a tiered program. This program would award differing amounts of loan forgiveness based on their income. If they made more money from their degree, the less they’d have forgiven. Rather than 100% of their loans wiped clean, the average was about 30%.

http://financialhelpers.com/new-partial-student-loan-forgiveness-tiered-program-being-worked-out/

According to the DeVos, it’s unfair for the taxpayers to brunt the full burden of student loan forgiveness laws. However, on Wednesday, a federal judge rebuked the education secretary. It delivers a substantial blow to the Trump administration’s desire to cozy up to financial institutions rather than defrauded students.

The Ruling Against DeVos

Many critics of DeVos argue that she’s a shill for the financial institutions that offer student loans. She brought several big names from for-profit schools onto her staff. It’s easy to see why the Trump administration was in favor of reducing strict regulations that prevented the predatory behavior. Yet, according to a federal judge, they were breaking the law.

According to the judge, DeVos’ actions against delaying rules enacted under President Obama were “arbitrary and capricious.” Attorney Generals from 19 states, all Democrats, filed a lawsuit against DeVos for not following these rules. She defended her actions, saying Obama’s ruling was “a muddled process that’s unfair to students and schools.”

“It’s a really big deal, it’s an incredibly important win for student borrowers and really for anyone who cares about having a government that operates under the rule of law as opposed to as a pawn of industry,” said Toby Merril, a litigator at Harvard University’s Project on Predatory Student Lending.

Actions Towards Student Loan Forgiveness Laws

It’s still unknown how this ruling will impact how the Trump administration will handle student loan forgiveness going forward. They have an appointment later today with the judge to discuss possible remedies. Advocates for students hope the judge restores the Obama rules to ensure they have protection from predators.

Another lawsuit is waiting in the wings to tackle the partial loan forgiveness program again. Until the case is settled, DeVos will most likely be ordered to abide by the current rules. It’s unknown whether Wednesday’s ruling will impact how the Department of Education will handle defrauded student cases moving forward.

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How Volunteer Work Can Help Pay Back Student Loans

Written by adminSeptember 13, 2018
Student Loan Consolidation

For millions of people struggling with their student loans, many of them are searching desperately for options. For those who couldn’t find work after obtaining their degree, going into default seemed like their only choice. The problem with that is, it made paying their student loans much more difficult, as interest piled on.

However, students have other options they may not be aware of. There are a lot of non-profit organizations looking to help students pay off their loans.

Danny McGee, a Michigan father who racked up $85,000 in student loans to become a building system engineer. After getting his Master’s degree from Tufts University, he was paying $850 per month on his loans. To make up for his lost income, McGee started working restaurant gigs, but it didn’t fit into his schedule.

http://financialhelpers.com/baby-boomers-are-not-doing-as-well-financially-as-you-might-think/

“I spend a couple of hours each week looking for additional ways to pay off my debt,” said McGee. As he continued to search, he found out about one such organization called the Shared Harvest Fund. The Shared Harvest Fund works to connected volunteers with paid opportunities and nonprofits that they are passionate about. Also, they will help pay back student loans.

For former students like McGee, it was the perfect opportunity. “Hopefully, debt freelancing is a way I can be a little bit more efficient with my time and that I can combine my passions in things that I care about with supporting myself,” he said.

How Shared Harvest Fund Works

If you care about social work to benefit others, you can do great work within that community and receive a monthly stipend. It can be anything from community development projects to helping solve homelessness. Just create a profile on their website, and they’ll pair you up with a project you care about. The stipend will pay out as much as $1,000.

This money is paid directly to your student loans. Even if you’re unable to do significant community projects, other odd jobs might fit within your expertise, such as accounting and legal assistance. It’s all about user experience to help others in a way that uses their time wisely. Jan Overton, a USC grad with six-figure debt amounts agrees.

“I’m really looking for work that’s more conducive to my schedule. Even if it’s only an extra $250 – at least those hours I work are giving to someone else to help someone,” she said. “If I could help other people at the same time while paying off my loans, not just for a job, but enriching my life, it’s such a better way to do it.”

Other Organizations to Help Repay Student Loans

Shared Harvest Fund isn’t the only organization that helps repay student loans. SponsorChange and Zero Bound are two others that use philanthropic work in this manner. The National Health Service Corps is a group that is in desperate need of health care professionals to volunteer in underserved areas.

AmeriCorps is a government program that matches professionals up with service programs. They can aid with natural disaster response and other relief efforts. Users who participate can receive the Segal AmeriCorps Education Award that grants the equivalent of the Pell Grant.

Students should know that there are options to help them pay for their student loans. It may be a struggle for a while, doing volunteer work at your own pace while paying off loans will be worth it. Gaining financial freedom while benefiting the community is something no one should regret.

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New Partial Student Loan Forgiveness Tiered Program Being Worked Out

Written by adminSeptember 11, 2018
Student Loan Consolidation

At the start of September, the student loan watchdog abruptly resigned his post. He cited in his resignation that the Trump administration was doing little to protect students. His job is to take on legitimate fraud cases to keep the process fair for students. This type of fraud used to result in the student receiving full student loan forgiveness benefits. Not any longer.

In recent years, for-profit schools have developed a reputation for using aggressive marketing tactics. Likewise, these tactics include promising ultra-high job placement rates. They even offer to help the student connect with employers. These promises ultimately proved fruitless. Students continue to rack up massive amounts of student loan debt.

Student Loan Forgiveness Under Trump

President Trump and Education Secretary Betsy DeVos aren’t real fans of student loan forgiveness. Their attempt to wipe out the program instituted by the Obama administration wasn’t successful. At one time, if a student was swindled or defrauded by their school they could have their student loan debt forgiven. Reluctantly, the Trump administration agreed to keep the program intact for the 2018 budget season.

DeVos is in favor of a different type of program. She appears to be in favor of a new tiered relief policy based upon income.

There were 16,000 claims of fraud against for-profit colleges. Only 1,000 of those cases received full student loan forgiveness. The rest received varying degrees of forgiveness. It was all based around their income after they graduated. In total, only 48,000 claims of fraud and abuse were approved out of the 165,000 filed since Obama started the program.

A Balanced Approach?

On average, DeVos’s education department has only forgiven around 30% of a student’s loan. They compare the earnings after graduation to other students who have graduated from the same program at other schools. Still, while the Obama administration never denied a fraud request, the Trump administration has dismissed over 9,000 cases.

Because of this, critics of DeVos and this new tiered program say she’s in the pocket of for-profit schools. They say she brought in officials from these schools to help serve within the agency. They appear to be serving the interests of the schools by easing regulations and making it tougher for students. However, according to DeVos, this is just a more balanced approach.

http://financialhelpers.com/student-loan-watchdog-has-abruptly-resigned/

“No fraud is acceptable, and students deserve relief if the school they attended acted dishonestly. (This new process) will allow claims to be adjudicated quickly” and “also protects taxpayers from being forced to shoulder massive costs that may be unjustified,” said DeVos.

Along with President Trump, she believes it’s unfair for taxpayers to bear the brunt of paying for full student loan forgiveness. With this new program, she feels that it’s a more balanced approach to helping students. Yet, while fraud happens, students still receive a degree and find meaningful work after graduation.

The Crisis Rages On

The Obama administration appeared to take the situation much more seriously. They went after the significant for-profit schools that were using deceptive processes. ITT Tech and Corinthian College are shut down. Many thousands of students had their debt erased at a total of $550 million.

Student loan debt rose to over $1.5 trillion and continues to climb. It’s a crisis likely to continue. Now that the economy is doing better, students won’t be as desperate to seek a degree for meaningful work. They’ll have the tools they need to understand their student loans. It won’t be easy. Life can be difficult with the burden of loan debt. In fact, many students will suffer for decades. Still, the government will continue to debate this for decades to come.

Before starting college, educate yourself. Financial Helpers is here to get you through the process. If you have any questions, don’t hesitate to call us at the number below:

Call Now 844-332-2079

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7 Strategies to Help You Get Out of Student Debt Faster

Written by adminJuly 6, 2018
Student Loan Consolidation

On this site we’ve covered student debt and how much it can negatively impact your life.

Americans owe $1.48 trillion in student debt and it’s crippling a lot of people the moment they step out of college and university halls.

Yet, once students graduate, a lot of them continue to make bad financial decisions that leave them struggling in life outside of college.

Here’s the deal: there’s no reason why you should spiral out of control or feel shame that you have this debt. You have to be proactive and decide you’re going to get it taken care of quickly.

If that means moving back home as part of the process, then don’t be afraid to do it. Not everyone will settle into the career of their dreams immediately after graduation. In a lot of cases, if you have outstanding debt that defaults, you legally won’t be able to work in your chosen field, as the state will pull your license.

The overall problem with debt is even when you pay it off regularly, most of the payments you make go straight to interest. And you better believe the bank gave you an interest-heavy loan coming out of high school, with no income and a lack of work experience.

If you’re one of millions of graduates suffering with student debt you’re not sure how you will ever get paid off, here are 7 strategies that will help you:

1) Set an Aggressive Payoff Date

If you just stick to paying the minimum amount, you can spend the next 8-10 years paying off your debt, the majority of your payments going towards interest. That’s thousands of extra dollars you don’t need to be paying, and you won’t if you pay more than just the minimum each month.

Rather than sticking to the minimum, set a more aggressive payoff debt. It’s very possible to pay off your debt in 3-5 years instead of 8-10. Having a sooner date will keep you motivated!

2) Look into Refinancing

Your current rate doesn’t have to be the same rate you pay throughout the life of your loan. If you’re doing well after you graduate, you have a job, making decent money, and your credit score has improved, then you can refinance your loan and get a better rate. You can ultimately save thousands of dollars by refinancing.

3) Do Your Research

 As discussed in the first strategy, a lot of your payment goes towards interest. Whatever you pay after that goes straight to the principal amount. It’s always a good idea to have a working understanding of how your loan operates, how much of your payment goes towards interest, and so on.

If you have more than one loan, you can decide to pay the smaller one off sooner (which can motivate you big time). What you decide is up to you, but you really can’t get into the game without knowing your numbers and having a good idea how it works.

4) Don’t Go the Forbearance Route!

It’s always tempting to want to push off making payments, but it’s not practical! You might be thinking you’re buying yourself some time, but the interest will still add up! You can add thousands of dollars’ worth of interest this way, only making the process take years longer. So, even when money is tight, pay your bill.

One of the first steps in achieving this freedom is asking for help. We are the experts in taking care of student debt problems, including refinance and debt consolidation. If you have any questions about your options, give us a call at the number below!

Call Now 844-851-8148

5) Look for Ways to Cut Your Spending

This part will suck, but remember, it’s only temporary! If you want to get rid of your loans sooner, cut back on spending. Can you forgo the vacation for the next couple of years and apply that money towards the loan instead? Maybe consider a cheaper car, cutting cable, and waiting to buy that house. Your #1 goal should be getting out from under this massive burden.

There are lots of things you can do to help make the process go faster:

-Get a roommate to help share the bills.

-Get a second job or even a side hustle.

-Give up the luxuries. If you don’t need that gym membership or the extra subscriptions, cut them!

-Move back home. If your parents are willing to help you out, take the time to settle in your new career while paying less bills, allowing you to pay off your debt sooner.

6) Keep Track of Your Payments

 A great way to stay motivated is keeping track of your payments. With each payment you make, you can see your overall total going down, which is such a good feeling. You can use a spreadsheet or just record the numbers in a notebook. Either way, keeping track is effective!

7) Don’t Give Up!

I know it’s tough looking at that big number and staying motivated. It might make you want to push off paying it, or avoid is as much as possible. This is the worst thing you can do, as mentioned previously, the interest will still rack up. The only way to get rid of it is to pay it off. Declaring bankruptcy won’t touch your student loan.

It’s a lot of money, but you can do it! And if you’re proactive, you can do it in a few years. Even if money is tight, keep paying. Before you know it, you’ll have achieved financial freedom and can move on with your life.

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You Won’t Believe How Much Debt Has Changed Since The Great Recession

Written by adminJune 28, 2018
Credit & Debt Settlement

The Great Recession that hit a decade ago was a tough time for millions of Americans.

One of the reasons for the recession can be explained is how Americans spent their own money. Debt (and debt payments) grew so large that there was a steep drop off in consumption. The situation was much more detailed than that, but household debt reached a peak and the trouble flowed in every direction.

If people weren’t spending money to pay off their auto loans, mortgages, and other debts, then those industries struggled to keep their head above water. As foreclosures continued to pile up, Americans ultimately spent less and less money.

It required massive bailouts by the federal government to get us out of the mess, but that doesn’t mean Americans have made smarter financial decisions to prevent another Great Recession from happening.

In fact, our debt is higher than it’s ever been in the history of this country. Mortgage debt is lower than it was in 2008, but all other forms of debt, like credit card debt, auto loans, and student loans, are 45% higher! That’s an absolutely shocking number.

We’ve been cranking up our debt at a rate of 3.4% each year and set to cross $15.7 trillion in total debt by the end of this month, which is a $1 trillion increase from what it was back in 2008.

Americans have always been in debt, and if often requires the government to take drastic actions to prevent us from entering another scary phase where millions struggle to make ends meet. So, while the Obama Administration helped us take care of a large chunk of mortgage debt, that freed us up in pursuit of other debts.

While jobs were laying off workers, many decided to go back to college and get a degree, leading to a shift in the type of debt Americans are accumulating. Currently, student loan debt is about 42% of the total amount of debt consumers have. Credit card debt is at about 27%.

The numbers have reversed in the last decade, as credit card debt was 42% and student loans were at 27%. 10.3% of our disposable income is going towards student debt alone, which is up from 6% a few years ago, a 130% increase since 2008.

75% of millennials today say they’re stressing big time over their student loans as they struggle to pay them back. They’re graduating college with all this debt, but not finding adequate work to help them pay off even the basic minimum they’re required, often throwing their loans into default.

The battle now within the government is how much they’re willing to help students overcome this massive burden. The Obama administration instituted several programs that are still available to this day, but the Trump administration has targeted their removal to help cut federal spending.

Trump has agreed to leave these programs alone for now, but no one knows what will happen when the 2019 budget is formulated. That leaves students with a short amount of time to get the help they need to pay down their student loan debt.

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