Student loan forgiveness and cancellation programs do exist, but the options are pretty limited. To qualify you must meet specific requirements and the process is not a walk in the park. Recently, debates and dialogue over a potential complete student loan debt wipe-out have surfaced worldwide, following President Biden’s proposed student loan cancellation plan.
It goes without saying that student loan debt is a wrenching burden to students and graduates from all over. Any form of economic relief, especially during a pandemic, sounds pleasant. Of course, loan cancellation will provide much-needed relief, but there’s no guarantee it’ll occur or impact you right away. It’s critical to have a back-up plan in place if you’re struggling with loan repayment. Until then, read on for what student loan cancellation could do for Arizona residents.
Putting Student Loan Cancellation in Perspective
Eliminating debt could be a transformative experience, both personally and professionally. Although the costs of student loan cancellation are currently unknown, or at-least not widely understood just yet, the following speaks to what life without student loan debt could mean for Arizona residents.
Take Control of Your Career
One of the most significant drawbacks to student loan debt is its effect on those entering the job market. While almost all student loans come with a grace period, the moment graduation arrives, the pressure is on. Graduates have to start thinking about how they’re going to repay their loans. With shifting labor markets and job insecurity, some graduates may feel inclined to take any job that comes their way, even if it’s underpaid or not related to what they’re passionate about.
If student loan debt was canceled, recent graduates wouldn’t feel compelled to accept random jobs and could instead wait for better opportunities. As a result, they would likely feel happier, less stressed, and more optimistic about their future.
Own Your Future
The most apparent benefit of student loan cancellation is that it would allow people to get more in touch with their future. Because debt often holds a student back from owning property, starting a family, and taking career risks, borrowers are forced to put their lives on hold—sometimes for several years.
Without debt, people can get married sooner, have children, put a down payment on a house, buy a car, travel, start a business, and more. The possibilities are endless. The simple fact that you can enjoy your life and not worry about your finances will inevitably ease the process and improve mental health.
What About Student Loan Cancellation for Private Loans?
While cancellations for federal loans are in the works, private student loans are a different story. The market for private student loans is ever-growing and indicates how far the student loan debt crisis extends—beyond just federal loan borrowers. It’s not required by law for private lenders to forgive borrower debt; therefore, it’s entirely up to your lender’s discretion if they would agree to cancel your loans or not. Unfortunately, you’re probably not going to get the outcome you want. Because private lenders are businesses, canceling your loans would only hurt them.
Still, there’s no harm in discussing cancellation programs. Communicating consistently with your lenders shows that you’re trying, so they may be more willing to come to a resolution with you. Perhaps instead of cancellation, they’ll reduce your loan balance or temporarily lower your monthly payments.
Learn More About Better Ways to Manage Debt
For many, waiting around for moves to be made on student loan cancellation isn’t worth it. Meanwhile, loan balances increase, interest charges grow, and stress levels hit an all-time high. Also, it’s doubtful that student loan forgiveness will have any effect on private student loan borrowers. That said, debt settlement may be a viable option to reach your goals of becoming debt-free. The Arizona debt lawyers at McCarthy Law PLC work strategically to forge a debt-relief solution that works best for your situation.
At McCarthy Law, our nationally recognized legal team is committed to getting you back on your feet. We strive to get you the fresh start you deserve and provide you aggressive protection from creditors. For a free case review, reach out to our experienced debt settlement attorneys by calling (855) 976-5777 or filling out a contact form today.