Student borrowers face penalty for co-signer’s misfortunes.

As a debtor you have consistently been making payments each month cutting down the balance. Suddenly your cosigner dies or files for bankruptcy protection. Now, your creditor is demanding that you pay back the entire loan – despite your good faith and consistent payments.

Automatic defaults are a big problem for private student loans according to a report by the Federal Consumer Financial Protection Bureau.

More than 2,300 private student loan complaints and 1,300 debt collection complaints related to student loans submitted to the Bureau since October 1, 2013 have been analyzed.

The Bureau’s student loan authority, Rohit Chopra, explained that the agency cannot determine how many borrows are impacted by automatic defaults. The problem occurs with many loan and lender servicers.

The majority of student debt is from federal loans which typically do not require a co-signer.

Private loans have different rules than federal however. Private loans are typically more common for high-debt borrowers and they usually require a co-signer. More than 90% of private loans are cosigned and typically by a grandparent or parent.

Automatic defaults can be extremely damaging for borrowers because potential employers and landlords can check credit reports. Defaults can destroy an otherwise good credit score.

Here are some questions about private student loans and co-signers:

How quickly can an automatic default appear on my credit report after my co-signer dies or files for bankruptcy?

Most lenders check their credit bureaus typically every month. The effects can be seen on your credit report within a short amount of time.

Can I ask to have my co-signer released from my loan?

Typically lenders will promote options of having a co-signer released if the debtor has met a certain amount of consecutive on-time payments for a certain amount of time (two-years usually) and has decent credit. Lenders however have been known to change the policy even after meeting the criteria to release the co-signer. It is best to check for certain.

How do I know if I'm eligible to have my co-signer released?

Always be sure to ask your creditor about its policy and request the moment you have met the criteria. It is good to do this in case anything happens to your co-signer. Also, co-signers can request a release for themselves.

Marcadis Singer, PA

Florida Collection Attorney

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

(888) 547-1881

(813) 288-1881

New Clients 

Ext. 247 Gil Singer

Ext. 240 Ralph Marcadis

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Hospitals Halt Extraordinary Debt Collections

It's a sign of the times in the tightening of how debt can be collected.

http://www.forbes.com/sites/insidepatientfinance/2014/01/16/hospitals-ordered-to-halt-extraordinary-debt-collection-for-now/



Not-for-profit hospitals have been ordered to stop "extraordinary" debt collection unless they can clearly show the patient does not qualify for financial assistance.   gthe industry waited over a year and a half for the IRS to come up with final regulations.  

Now Patients have roughly 6 months from the time of service to decide wether or not to apply for financial assistance, they then have another 6 months to complete the paperwork.  During that period, hospitals can no longer go to "extraodinary" measures to collect on the past due debt.

This applies to Not-For Profit Hospitals only.

This is an offshoot of the Affordable Care Act.  The Affordable Care Act requires not-for-profit hospitals to have "reasonable billling and collection rquirements" but it never defined reasonable.

The new definition is a negative definition.  Instead of defining reasonable, it defines what is Extraordinary, and therefore forbidden.

Specifically, the regulations prohibit nonprofit hospitals from engaging in “extraordinary collection actions” for up to 120 days after the patient gets his or her first bill. The regulations define “extraordinary” as:

• Reporting a patient’s delinquent debt to a credit bureau’

• Selling a patient’s debt to a third party;

• Placing a lien on a patient’s property;

• Foreclosing on a patient’s real property;

• Attaching or seizing an a patient’s bank account or any other personal property;

• Commencing a civil action against a patient;

• Causing a patient’s arrest;

• Causing a patient’s to be subject to a writ of body attachment; and,

• Garnishing a patient’s wages.

Not-for-profit hospitals can still engage a third-party to collect a patient debt.

We have all seen this coming for some time.   We will offer more on this as it develops.

Marcadis Singer, PA

Florida Collection Attorney

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

(888) 547-1881

(813) 288-1881

New Clients 

Ext. 247 Gil Singer

Ext. 240 Ralph Marcadis

Existing Client Client Liaison

Ext. 242

To Pay a Claim

Ext.  245

Gainesville Debt Collection Attorney

Today we celebrate our attachment to Gainesville.

Ralph Marcadis is an alum of the University of Florida, and maintains strong ties to his Alma Mater.

http://www.marcadislaw.com/index.php/primary-cities/gainesville-debt-collection-attorney

We welcome all of our Gainesville alum's that are now running their own businesses and need help with their receivables to reach out to us, as we are Debt Collection Attorney's serving the entire state of Florida, and especially our old home of Gainesville.

Marcadis Singer, PA

Florida Collection Attorney

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

(888) 547-1881

(813) 288-1881

New Clients 

Ext. 247 Gil Singer

Ext. 240 Ralph Marcadis

Existing Client Client Liaison

Ext. 242

To Pay a Claim

Ext.  245

#7 Shop Shop Shop

You shop for clothes, you shop for cars, you will shop your house, shop your college as well.

Often college choices are not researched and sometimes choices border on totally illogical.   Price does not always equal quality.

Thank You Wells Fargo for this image.

One of the easiest ways to score financial aid is to apply to schools that offer lots of it to students like you. The National Center for Education Statistics' College Navigator tool can help you find institutions that offer substantial aid packages to families in your income bracket while The Education Trust's College Results Online database can identify colleges that are similar to your dream school in net price and academic competitiveness.

Debt follows you for life, it isn't forgiven in bankruptcy.  Your college education, or your children's has to be shopped, weighed against earnings, and has to not pose such a large burden on the family or student that the debt cannot be paid.

Marcadis Singer, PA

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

(888) 547-1881

(813) 288-1881

New Clients 

Ext. 247 Gil Singer

Ext. 240 Ralph Marcadis

Existing Client Client Liaison

Ext. 242

To Pay a Claim

Ext.  245

Another in our stand against unreasonable Student Debt (Con't)

5.  Consider non-traditional Student Loan Debt Providers

Federal Lans nearly always provide better interest rates on your college debt, and typically provide better debtor protections.

 However, if you need a private loan supplement, there are more and more interesting alternatives in the emerging crowd sourcing market.

• scholarshipproz.com/provides students with a platform to make their needs known and turn their education into a family, friend and community event, says vice president of marketing, Orlando Espinosa. 

• Upstart.com offers crowd funded loans in exchange for a percentage of the borrower's income over the next five to 10 years

• YouCaring.com lets users set up free fundraising pages for a variety of causes and students can share their pages with donors around the world through social media sites like Facebook, Twitter and Pinterest.

• GradSavecom  directs donors to contribute directly into a user’s 529 plan, an education savings plan operated by either a state or higher education institution designed to help families save for college.Watch out though, not everyone gets their campaigns fully funded.

• FiPath allows parents to direct the funds into a savings account without paying fees for early withdrawal, Harrington explains that “collective peer pressure” prevents anyone from dipping into the account.

These nontraditional sites are an interesting alternative, just be careful as not all campaigns end up funded.  Be creative, shop as best you can to minimize your college debt, and debt expense.

Marcadis Singer, PA

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

(888) 547-1881

(813) 288-1881

New Clients 

Ext. 247 Gil Singer

Ext. 240 Ralph Marcadis

Existing Client Client Liaison

Ext. 242

To Pay a Claim

Ext.  245

Another in our stand against unreasonable Student Loans (Con't)

4.  Take the income driven assistance plan

There's a new program that has been put out there to help reduce the risk of default for college grads with lots of collect debt.

Eligible federal loan borrowers can have their monthly student loan payments capped at 10 percent or 15 percent of their discretionary income and forgiven after 20 or 25 years of consecutive payments.  There's tax consequences on what gets forgiven.   If ou work in public service, you many even have your debt forgiven in 10 years, and without the tax issues.

Check out www.studentaid.gov  to estimate your payments using the income based scale.

Marcadis Singer, PA

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

(888) 547-1881

(813) 288-1881

New Clients 

Ext. 247 Gil Singer

Ext. 240 Ralph Marcadis

Existing Client Client Liaison

Ext. 242

To Pay a Claim

Ext.  245

2014 The Year Ahead in Debt Collection Part 5

Credit Report Disputes

Amazingly, as long as the big 3 credit bureaus have been in existence, there has never been a fine for sloppy practices or ignoring consumer disputes.

One has to ask, are they that well run, or has oversight been that sorely lacking?

This is a question that will likely be addressed by the agency of the coming year.

One of the thorniest issues will be finding a way to disentangle individuals credit.  For instance, when there is a divorced couple with one being a responsible bill payer, and the other not.  Thsi tangling can become a credit untangling nightmare.


Surprisingly, if you extrapolate from comments made by Chi Chi Wu, a lawyer at the National Consumer Law Center focussing on consumer credit issues  "We would like to see matching  <social security number> based on all nine digits of the social security number." that implies at least to us, that someone's credit with a similar personal history, just a number or two off from my social security number, could have a big impact on my own personal score.

These are things well worth the time and effort of the board to sort out.

Marcadis Singer, PA

5104 South Westshore Blvd.

Tampa, Florida 33611

info @ marcadislaw.com

http://www.marcadislaw.com

(888) 547-1881

(813) 288-1881