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Overcoming College Debt Challenges: Top Strategies for Financial Freedom

George Simons | June 29, 2023

George Simons
Co-Founder of SoloSuit
George Simons, JD/MBA

George Simons is the co-founder and CEO of SoloSuit. He has helped Americans protect over $1 billion from predatory debt lawsuits. George graduated from BYU Law school in 2020 with a JD-MBA. In his spare time, George likes to cook, because he likes to eat.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: Student loans provide access to quality education. However, repayment is cumbersome and causes mental stress. For this reason, it’s important for students to develop financial literacy and seek professional advice from financial planners. Students who have been sued for student loan debt can use SoloSuit to request a debt validation, respond to a debt lawsuit, and settle the debt before going to court.

The United States granted a three-year federal student loan moratorium in March 2020. It paused loan repayment as a temporary relief in response to the COVID-19 pandemic. Three years later, interest on the loan will resume on September 1, 2023, and payments will start in October. This means cancellation of 0% interest and administrative forbearance.

Student loans are an integral part of the US education system. They facilitate access to higher education, equalize opportunity, and are considered an investment in one’s future. Despite the benefits of student loans, the crushing weight is overwhelming for many individuals. High debt amounts and interest affect the borrower’s financial stability and repayment.

In this article, we will discuss financial tips for college students, bits of advice on how to overcome financial problems, and how to fix student loan debt.

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Debt has a big impact on college students

Higher education is costly, and there is no arguing with that fact. The upfront cost of books, tuition, fees, and other educational expenses strain learners without sponsors and scholarships. As well-meaning as the initiative is, college debt impacts students in various aspects.

Mounting debt can affect students in the following ways:

  • Financial stress.
  • Delayed financial milestone.
  • Career choice pressure.
  • Deterred post-graduate education.
  • Mental health impact.
  • Impacts credit scores and creditworthiness.

Undergraduates who are in debt try to budget and manage their expenses while worrying about repayment. It prevents them from saving for emergencies, buying a home, or even starting a family. In addition, they feel pressured to prioritize higher-paying jobs over pursuing their passion. The situation deters students from pursuing post-graduate studies and contributes to anxiety, depression, and other mental issues.

Luckily, there are ways to overcome college debt and find financial freedom again.

Develop financial literacy and seek professional advice

Education is power, and this applies to college debts. The first step to freedom is to develop financial literacy and seek professional advice.

Information improves a student’s financial understanding and provides empowerment. Moreover, it promotes effective debt management and aids resource maximization. While it is true that student loans make you feel powerless, there are laws governing how student loan debt collectors recoup loans. Take a look at some examples below:

  • The Higher Education Act spells out ways to get out of default and back into good standing.
  • The Fair Debt Collection Practices curbs abusive collection practices.
  • The Fair Credit Reporting legislation regulates how collectors report information to credit reporting agencies.
  • The Telephone Consumer Protection Act restricts creditors from contacting you by text, cell phone calls, and messages.
  • The Service Members Civil Relief law applies to active U.S. Military members. People covered by it have interest rates reduced and payments postponed until they return from active duty.
  • The U.S. Bankruptcy Code resolves and frees an individual from continued collection activities.

Student loans are dynamic, and so are the rules guiding them, like how long it takes to default on a loan and when the loan is sent to a creditor, debt collector limits, what to do when they call, and how to fight against illegal collection tactics.

We recommend learning as much as you can about finances through books, online resources, and webinars to improve your knowledge. Apart from this, seek advice from a certified financial planner or credit counseling agency to make informed decisions.

Many undergraduates take part-time work to make money and ease their financial situation. But looming essay assignment deadlines and coursework affect their productivity. Students that want to achieve balance can get assignment done online by delegating tasks to a professional writer or reputable online service.

Sued for student loans—Here’s what to do

Whether you get sued for a student loan or not depends on whether the loan is federal or state. The federal government does not sue since it has many options to force repayment. For example, wage garnishments and tax refund withholds.

A missed loan is considered delinquent but won’t enter default for 270 days. At this point, the entire loan balance is due, and you may start noticing deductions from your paycheck. We recommend you talk to your loan servicer immediately to explore possible options if you miss a payment. After all, no one wants to take the situation to litigation.

If you miss the first payment, a private lender can take you to court over a defaulted loan. This often marks the beginning of financial issues for college students. Follow these simple student loans solutions to handle the situation:

SoloSuit can help with all of these steps and more.

SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software can help you send and receive settlement offers until you reach an agreement with your lender. Then, we help manage the documentation of your agreement and transfer your payment to the lender, keeping your financial information private and secure.

To learn more about how debt settlement can help you manage student loans, check out the following video:

Tips to achieve financial freedom as a student

It is not easy to achieve financial freedom in college. But with careful planning and disciplined habits, you’ll live a comfortable life. Pay attention to the following money management tips for students and professionals:

  • Create a budget to track your income and expenses and set financial goals. Allocate your income to different expense categories and stick to them. Meanwhile, prioritize essential costs and put a portion towards debt repayment and savings.

  • Differentiate between needs and wants, and reduce non-essential expenses. Consider cooking at home, public transportation, and student discounts to save money.

  • Reduce borrowing and explore other funding sources. Common examples include scholarships, grants, and work-study programs. Focus on high-interest rates first and use the debt snowball or avalanche method to accelerate your progress. Most importantly, pay debts on time to avoid a private student loan lawsuit.

  • Take on part-time work to support your expenses or leverage your skills to earn extra income. Think about online tutoring, freelancing, or selling items you don’t need. Invest in yourself by prioritizing your studies and making the most of the opportunity. In the meantime, pay an essay writer help to complete assignments online so your academics do not suffer.

  • Seek financial counseling and attend events that teach budgeting and debt management.

Conclusion

Debt opens the door to different financial challenges for students. However, it does not give anyone the right to bully you. Ultimately, it comes down to financial literacy and college money management. Various law aspects protect you from illegal debt collection, harassment, and litigation. But you must play your part by not defaulting on loans. Start by taking control and living a responsible financial life. Cut excesses and use a budget to track your expenses. Pay debts on time and explore free funding options like grants and scholarships. Furthermore, maximize your income by working part-time online or remotely and using credit wisely.

If you’ve been sued for a debt you should request debt validation, settle the debt before your court date, or file an Answer into the case. SoloSuit can help you do all this and more.

What is Solo?

Solo makes it easy to resolve debt with debt collectors.

You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt. SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

SoloSettle can help you contact your debt collector or creditor and negotiate the debt to settle for less, all online. It simplifies and streamlines the process to settling your debt.

No matter where you find yourself in the debt collection process, Solo is here to help you resolve your debt.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)

How to Answer a Summons for debt collection in all 50 states

Here's a list of guides on how to respond to a debt collection lawsuit in each state:

The Ultimate 50 State Guide

Debt collector guides

Are you being contacted by a debt collector? We’re making guides on how to resolve debt with each one.

Arbitration

If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.

Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.

Bankruptcy

Bankruptcy is a great way to legally resolve debt, but it's usually best to consider it as a last resort. Here are some bankruptcy guides to help you decide which debt resolution option is best for you.

Check your case status

Don’t have time to go to your local courthouse to check the status of your case? We’ve created state guides on how to check the status of your case throughout the US, complete with online search tools and court directories.

Credit

Debt has a big impact on your credit. Below is a list of guides on how to repair and improve your credit, even while managing major debt, along with other credit-related resources.

Debt collection FAQs

Find answers to some of our the most commonly-asked questions about debt collection below.

Debt collection documents and templates

If you're dealing with debt, these documents and templates will help you respond, protect your rights, negotiate, and resolve your debts.

Debt relief

We’ve created a specialized guide on how to find debt relief in all 50 states, complete with steps to take to find relief, state-specific resources, and more.

Debt settlement

Debt settlement is one of the most effective ways to resolve a debt and save money. We’ve created state guides on debt settlement. Find out how to settle in your state with a simple click and explore other debt settlement resources below.

Eviction

Facing an eviction? The following guides will help you navigate your situation with confidence.

Federal debt collection laws

Knowing your rights makes it easier to stand up for your rights. Below, we’ve compiled all our articles on federal debt collection laws that protect you from unfair practices.

Legal aid

Helping people find access to justice is at the heart of Solo's misison. If you're dealing with a legal debt issue, the following guides will help you through it.

Medical debt

Having a health challenge is stressful, but dealing with medical debt on top of it is overwhelming. Here are some resources on how to manage medical debt.

Personal finance

Learn how to manage your finances and overcome crushing debt. Check out our personal finance guides below.

State debt collection laws

Debt collection laws vary by state, so we have compiled a guide to each state’s debt collection laws to make it easier for you to stand up for your rights—no matter where you live.

Statute of limitations on debt

Like all debt collection laws, the statute of limitations on debt varies by state. So, we wrote guides on each state’s statutes and more.

Stop collection calls

Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.

Wage garnishment

Forgot to respond to your debt lawsuit? The judge may have ordered a default judgment against you, and with a default judgment, debt collectors can garnish your wages. Here are our guides on how to stop wage garnishment in your state, plus other wage garnishment resources.

The Debt Hotline

Hosted by Team Solo, The Debt Hotline breaks down debt and personal finance topics with help from attorneys, financial experts, and industry pros. We respond to real questions to help you navigate debt with knowledge and courage.

Other debt resources


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