Your Questions About Direct Loan Servicing

Nagesh answers:

Actually there is loan forgiveness now available to those that work in public service work. You sound that you would fall into that category off the top of my head, but it’s always important to check. Congress passed, and President Bush just signed HR 2669 (College Cost Reduction and Access Act), which would implement loan forgiveness for those that work in that sector for ten years. You must make 120 payments (12 months x 10 years), however they do not need to be consecutive. Make sure that you are already enrolled in the direct loan program (which you can do by contacting your lender). Although it doesn’t formally take effect until July 2009, any payments made now through the Direct Loan Program, will count.

Nagesh answers:

Http://www.peacecorps.gov/index.cfm?shell=learn.whyvol.finben

Deferment of Student Loans
Volunteers may defer repayment of student loans under several federal programs, i.e., Stafford (formerly known as guaranteed student loans), Perkins, direct and consolidation loans. Some commercial loans may also be deferred during Peace Corps service. Because the rules that authorize deferment are complicated and subject to change, it is best to talk to a Peace Corps recruiter about how this benefit applies to your situation.

Nagesh answers:

By law, lenders are required to use the same interest rate formula for Consolidation Loans. However, many lenders offer interest-rate reductions for paying on time or via direct debit. It is important to read the fine print and understand how you become qualified for or disqualified for a lender’s borrower benefits programs. Beyond savings, borrowers should consider customer service, flexible repayment options, online account access and applications, reputation and industry experience when selecting a lender.

Lots of shady characters have entered the consolidation market recently, so it’s important to stick with a big, reputable company. It might be a good idea to start with whoever currently holds your student loans.

Sallie Mae has a lot of good info about consolidation, including a quick tool that will show you how much you can save by consolidating. Http://www.salliemae.com/after_graduation/manage_your_loans/consolidate_student_loans/federal/student_loan_consolidation.htm

Nagesh answers:

They can be beneficial if you are dealing directly with the institution that is servicing the loan. The 3rd parties are just scheming of what you can do for yourself. I have been a direct GNMA lender/servicer for 17 years. I have seen more modifications ( legit ) in the last year then in all the last 17.

We do not want to foreclose. No matter the MI (mortgage Insurance) we will still lose 12-25% depending on the type of loan market area esc.

Contact your lender directly.

Nagesh answers:

Http://www.peacecorps.gov/index.cfm?shell=learn.whyvol.finben
says

Deferment of Student Loans
Volunteers may defer repayment of student loans under several federal programs, i.e., Stafford (formerly known as guaranteed student loans), Perkins, direct and consolidation loans. Some commercial loans may also be deferred during Peace Corps service. Because the rules that authorize deferment are complicated and subject to change, it is best to talk to a Peace Corps recruiter about how this benefit applies to your situation.

Cancellation of Student Loans
Only Volunteers with Perkins loans are eligible for a partial cancellation benefit. Fifteen percent of your Perkins loans can be cancelled upon the completion of each 365 days of service during your first two years of service, and 20 percent can be cancelled upon completion of each of the third and fourth years. Therefore, four full years of service would equal a 70 percent cancellation of your existing loan.