Three Steps to Solving Your Student Loan Nightmare

Michael Lux Blog, Student Loans 1 Comment

The Situation: You have long since finished your schooling.  Money isn’t what you had hoped.  Bills are coming in that you cannot afford.  You never answer calls from numbers you don’t recognize, because you know exactly what they want.  You have a student loan mess.  You want to fix it, but you really don’t even know where to begin.

There is an old Chinese proverb that says, “The best time to plant a tree was 20 years ago.  The second best time is now.”  You may or may not already realize that the best time to address your student loans has already passed, but right now is the second best time.  If you follow these three somewhat easy steps, you can plant the seeds for a brighter and less stressful future.

Step 1: Find all of your loans

This step sounds like it should be super easy, but be because these loans can change hands so easily, it is a bit more complicated.  However, if you know what sources to check, find your loans can be simple.

There are two types of student loans, federal and private.  The Federal government has records of all of your federal loans, and your credit report should have all of your private loans.  Here is a guide for finding ALL of your student loans.

It is important to find all of your loans and who services them/owns the debt for two reasons.  First, it helps you prevent becoming the victim of fraud.  Second, it gives you an idea of how big your student loan problem is and who to contact.

Step 2: Get organized

If you have been in college long enough to run up a bunch of student loan debt, hopefully you know a thing or two about organization.  One of the best ways to keep track of your student loans is to create a file folder for each loan.  You can name your folders according to when they were taken out or where you first got them, but by lender is probably the most efficient way.

As bills arrive in the mail, file them according to lender.  When you call your lenders (spoiler alert: that is the next step), take notes about each conversation.  Be sure to note when you called, who you talked to, and what you were told.  If you exchange emails, print them out and get them in your folder.

Sherpa Tip: Obviously you never want to end up in court with your lender, but if you do, you will definitely want to have these detailed records.

Step 3: Call your lenders

This is the part that can be intimidating, but the relief you feel after getting it done makes it worth the effort.  The money you save by fixing your problems should also be a huge incentive.

These phone calls may lead to answers you don’t like, but in this case getting the bad news is better than no news.  You may think you cannot afford your loans, but there are many programs in place to help out people in your situation.  The federal government has a range of repayment plans, and some private lenders offer programs to help people get their loans back on track.

Once you have all the facts in front of you, you can figure out the plan that works best for you and your individual situation.


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Student Debt Survivor
Student Debt Survivor

Step one, don’t take out student loans 😉 Regarding step 3, I found talking to my lenders on the phone incredibly frustrating. Most of the customer service folks didn’t understand what I was telling them and would transfer me around from person to person before “accidentally” hanging up on me. What I did find out, after the fact, was that some student loan companies have e-mail (this may be true of all of them now-that was a few years ago). It saved me a lot of headache because I had exactly what they had said in writing and they couldn’t debate they said it because I had proof. Long story short one of my loan companies accidentally “gave” me an extra $10k I didn’t want and returning it was a nightmare.