The term “snake oil” has been around for centuries. This expression commonly refers to scams or products that do not live up to their hype. Recently, Americans have fallen prey to many student loan scams from debt relief agencies selling snake oil. Student loan debt is a serious issue for many Americans who financed their education with the hopes that doing so would lead to better job opportunities and financial ability. Most college graduates did not foresee that the job market would be as competitive as it is and that repaying their student loan debt would be a significant burden that they would be shouldering for the rest of their lives.
Debt relief companies have created scams to take advantage of unsuspecting borrowers struggling with student loan debt. Many debt relief companies advertise that they can instantly reduce borrowers’ student loan debts by negotiating directly with the loan servicer. After the borrowers enter into a contract with the debt relief companies, those companies may send one or two letters to the loan servicer. The loan servicers usually do not comply with the requests of the debt relief companies. However, the borrowers are still on the hook to pay both their monthly student loan payments and the debt relief company.
Many debt relief companies lure distressed borrowers in with claims that they can quickly relieve their stress and lower their debt. Distressed borrowers who have been struggling to pay their student loans are usually extremely overwhelmed and on the verge of a breakdown. This vulnerability often results in the borrowers signing contracts that they do not fully understand. One of the most widespread scams by debt relief agencies is to lock borrowers into a contract that charges an ongoing monthly subscription fee. Borrowers may incorrectly think that the amount they are paying to the debt relief companies each month is going towards paying down the outstanding balance on their student loans. However, the debt relief companies are just pocketing that money and leaving the borrowers worse off than they were previously.
Student Loan Law Group recognizes that no company can guarantee any results in reducing a borrower’s federal or private student loan debt. Student Loan Law Group’s attorneys help borrowers analyze available options for repayment plans that are income-driven. Income-driven repayment plans lower the borrower’s monthly payment amounts to a manageable payment based on the individual borrower’s income and household size. Because unexpected pitfalls exist when applying for income-driven repayment plans, Student Loan Law Group encourages borrowers to follow Student Loan Law Group’s guides and consult with an attorney before applying for these programs. Many repayment plans require recertification on an annual basis. Student Loan Law Group guides borrowers and helps them make informed financial decisions regarding their student loans.