Federal loans aren’t the only hardship for college graduates. Many students also relied on private student loans to finance their education. Typically, private lenders are stricter on repayment terms, offering little to no grace period, no flexible repayment options, rare deferments, and capped forbearances. And while for many student loans, these strict standards remain in place, other private lenders are willing to make changes to help make repaying debt more manageable in today’s economy.
For instance, Wells Fargo – a private lender with borrowers in $11.9 billion outstanding student loan debt – recently announced that it will lower interest rates for borrowers meeting certain requirements. Staff will review supporting documentation proving financial hardship including paystubs, other types of income documentation, and any other documentation showing the borrower’s full financial picture. If you are a Wells Fargo borrower and believe you may qualify for a lower interest rate, you can call 1-800-378-5526 or visit this website. In addition to lower interest rates, it has also been reported that this month (February 2015) Wells Fargo plans to extend repayment periods. These changes have the potential to save Wells Fargo borrower’s thousands in interest payments.
Another private lender, Discover Financial Services is rumored to be making similar changes. Other than lowering interest rates for some of its borrowers, the hardest-hit borrowers may also be forgiven for a portion of their outstanding debt! The company, which holds $8.3 billion in outstanding student loan debt, is still working out the details.
If you’re a borrower with a different private company, continue to check with your lender. These changes mentioned above could mean less defaults and consistent repayments for these lenders, which may interest other private lenders to make changes as well.
Until Next Time,
Jenny L. Maxey
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