Advice Needed for a Friend with $200k in Private Student Loan Debt Default

General
1

Hey Students…

I need some advice for a friend who’s in a tough financial situation. She has about $200k in student loan debt with a private lender, but unfortunately, she ignored her payments and now the loan is in default. Recently, the loan provider offered to settle the debt for around $50k, but she has no money to cover that amount. The offer is only valid for the next three months, and if she can’t pay, she’ll owe the entire $200k as a lump sum, which is impossible for her to pay off
. :roll_eyes: :thinking:I’m wondering if there’s anything she can do to i improve her situation? What are her options, and what would likely happen if she can’t meet the settlement offer and the default continues into the end of the year? Anxiously awaiting assitance…

2

:slightly_smiling_face:Rehabilitation is returning the loan to good standing by making regular payments for a predetermined amount of time, typically nine months.

3

Consolidation is the process of combining many loans into one that may have more flexible repayment terms or a lower interest rate. :pensive:

4

:sweat_smile:
Debt settlement is the process of settling a loan by agreeing to pay less than the total amount due.

5

:grin:
Debt settlement is the process of settling a loan by agreeing to pay less than the total amount due.

6

:neutral_face: A credit counselor or lawyer that focuses on student loan debt can be a great resource for advice and support when navigating the tricky legal and financial terrain

1 Like
7

:smiling_face: Reaching an agreement on better terms for repayment, including a longer payback time or a reduced interest rate.