Looking for a student loan attorney in Texas? Good luck. People tell me all the time how difficult it was to find a lawyer near them that knew how to handle student loan issues.
Thankfully, for most things, location doesn't matter. I can help you stop a student loan garnishment, get out of default, negotiate a settlement, choose the right repayment plan, etc. no matter if you live in Dallas or Houston or San Antonio.
The one thing I can't help you with is if you're being sued for student loan debt in Texas. In that case, you really should work with a law firm near you.
Okay, with that out the way, let's go over a few student loan basics. Of course, you can skip the reading and schedule a free 10-minute student loan consultation by clicking here.
- Federal student loan basics
- Private student loan basics
- Loan forgiveness programs in Texas
- How to stop a student loan wage garnishment
Federal student loan basics
Federal student loans are a double-edged sword. They offer flexible repayment plans and loan forgiveness programs. Those are the good things.
The bad things start with the fact that federal student loans charge daily interest. They continue if you ever default.
When you default on federal loans, the Department of Education can:
- charge collection fees
- garnish your wages
- offset your tax refund
- garnish your Social Security benefits and
- stop you from getting more federal student aid.
Click here to read Guide to Dealing With Student Loan Default.
On top of that, if you ever file a consumer bankruptcy case (chapter 7 or chapter 13) federal loans are much harder to get rid of than private student loans. To get a discharge of a your federal student debt, you have to prove undue hardship by passing the three prongs of the Brunner Test:
- inability to maintain a minimal standard of living for yourself and your dependents if forced to repay the loans;
- additional circumstances indicating your financial situation is likely to exist for a significant period; and a
- good faith effort to repay your student loan debt (deferment, forbearance, income-based repayment, etc.).
Click here to read the Complete Guide to Student Loan Bankruptcy.
Private student loan basics
The repayment plan options for private student loans suck. If you can't afford your monthly payments, most private lenders/loan servicers will offer you a temporary forbearance. Some may even give you a temporary interest rate reduction. But that's about it.
They're not going to offer you an income-based repayment plan. And they're not going to agree to waive the interest or reduce your balance to what you originally borrowed.
If you can't keep up with your student loan payments, your options may be limited to look into refinancing with a different lender or attempting to negotiate a settlement.
To negotiate a settlement, your loans have to be in default.
I've never seen a loan servicer accept a settlement for a loan in good standing.
Click here to read the Guide to Negotiating Student Loan Settlements.
The good thing about private student loans is that defaulting on them isn't as bad as defaulting on your federal loans.
Student loan lenders can't forcefully take any money from you unless they file a student loan lawsuit against you and get a judgment.
When that happens, they may be able to garnish your wages (Texas has special rules that makes this hard to do) levy your bank accounts, and put a judgment lien on your home.
Filing bankruptcy on private loans
One other option you can look into is trying to get rid of your private student loans in bankruptcy.
In my experience, bankruptcy is a great option when you can't refinance your student loans and can't afford a settlement.
At that point, what else are you going to do? Wait for your lender to file a student loan lawsuit?
You could do that. Or you could be proactive. Meet with a bankruptcy attorney. File bankruptcy. And then file an adversary proceeding to try and discharge your student debt.
Click here to read How to File an Adversary Proceeding to Discharge Student Loans.
Loan forgiveness programs in Texas
There are at least 9 different loan forgiveness programs offered to Texas residents working in different professions.
Here's the thing about those programs, unless your loan balances are fairly low (think less than $50 thousand) these programs aren't all that helpful. The amount of forgiveness offered is low or it comes with a bunch of conditions, or both.
For many borrowers in Texas, the loan forgiveness programs they're more likely to take advantage of are the programs offered by the US Department of Education. Namely, the Public Service Loan Forgiveness Program and the loan forgiveness offered at the end of the various income-based repayment plans.
How to stop student loan wage garnishment in Texas
For most Texas residents, the type of student loan wage garnishment you're looking to stop is a garnishment for a federal loan.
Federal student loans can send a garnishment notice to your employer after you default. They don't need to sue you first.
To stop it before the garnishment starts, you may be able to apply for a loan consolidation or enter in the loan rehabilitation program.
If the garnishment has already started, your options to stop it are limited to entering the loan rehabilitation program or filing bankruptcy.
- How to Stop a Student Loan Garnishment After it Starts
- How to Stop a Student Loan Garnishment by Filing Bankruptcy