If you have a student loan, then you know it’s not easy to pay it off. But there are other problems associated with having a student loan. There are lots of issues people face when they are trying to refinance student loans without a degree. So, take a look at why some students go for bankruptcy for federal student loans and how to apply for refinancing without a degree.
Why do students need bankruptcy for federal student loans?
A new and improved federal law will allow student borrowers who have been in repayment for at least 20 years to discharge their federal student loans in bankruptcy. The new law is called the Student Loan Bankruptcy Fairness Act of 2019 (SLBFA), and it was signed into law by President Donald Trump on April 10, 2019.
For now, only those with Parent PLUS loans can apply to have them discharged through Chapter 7 bankruptcy. However, this could change in the future if Congress passes more legislation that would allow all borrowers to do so at some point in the future (the SLBFA allows this).
What is the grace period for student loans?
A grace period is a time between when you graduate and when your first payment is due.
It varies by loan type but generally lasts six months to one year.
The grace period allows you to find a job and prepare for your first payment. You’ll want to start making plans immediately so that the transition from college to working life goes smoothly.
Can you refinance your federal student loans?
You can refinance your federal student loans directly through your loan servicer or with a private lender. In both cases, you’ll need to start by identifying your federal student loan type. For example, if it is an education tax credit or loan forgiveness program, you cannot refinance these types of loans.
If you decide to refinance your federal student loans, remember that certain eligibility requirements exist. For example, suppose your current monthly payment is higher than the new one-year standard repayment term (10 years). In that case, refinancing isn’t likely to be beneficial for you—unless there’s another reason why it would be worthwhile (such as getting rid of late fees).
How to apply for refinancing without a degree?
- Find a company that offers good rates and has a solid reputation. Check websites like the Better Business Bureau, Yelp and Google reviews to see what kind of feedback customers give. It would help if you also considered whether the company is licensed to operate in your state or country (this information will be listed on their website). Lantern by SoFi has helped many individuals with their loans and refinances.
- Make sure you understand the terms and conditions of your loan before signing up for one. Try to avoid getting caught up in numbers; make an effort to understand each piece of information so that you can make an informed decision before applying for refinancing without a degree online.
After reading this article, you should know whether it is worth refinancing loans without a degree. All the information they provided might have been helpful for you, and now you must better understand how obtaining loans works.