Note that the government has paused all repayment on federally held student loans through the end of 2022, with no interest to be charged during that period and no loans to be held delinquent or in default.
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While student loan counseling is useful for some borrowers, it might not be worth the cost for others. Unless you need the accountability that working with a counselor can provide, you can instead rely on trustworthy free resources to learn about your repayment options and come up with a plan for managing your debt.
Here are five reasons you may not need to pay for student loan debt counseling, and how to get free or low-cost expert advice instead.
Reasons not to pay for student loan counseling
1. Some student loan counseling services are scams
2.A wealth of expert advice is available for free online
3. Free student loan calculators can help you understand your debt
4. Other free tools can collect your debts in one place
5. Your student loan servicer should help you for no charge
As the student loan debt crisis grows in the U.S., so does the number of student loan counseling scams. These predatory services target vulnerable borrowers with false promises that they can help you pay down your loans faster or cheaper — or get them completely forgiven.
Although legitimate loan forgiveness and assistance programs do exist, none can offer immediate loan cancellation — if any program claims to do that, it’s a scam. You could get loans forgiven, though, if you’re eligible. You’ll typically need to work for years before qualifying for programs such as Public Service Loan Forgiveness, which requires applicants to have made at least 120 qualifying federal loan payments while working in an eligible government or nonprofit job.
If a student loan counseling service is making promises that sound too good to be true, be wary. You should also back off if you feel pressured to sign up right away, pay significant upfront fees or share personal details like your Social Security number or Federal Student Aid (FSA) ID.
Unfortunately, there are scammers posing as student loan counselors, and their offers can be tempting. If a service seems sketchy, walk away and seek out one of the options below.
Although student loan counseling services can help you navigate your loans, the knowledge they share isn’t exclusive. In fact, you can find lots of unbiased, expert advice on student loan management online for free.
If you have federal student loans, the FSA website is a good place to start. It details various student loan repayment plans and forgiveness programs, including how to qualify and apply for them.
You already should have some knowledge of how the student loan borrowing and repayment processes work. That’s because most federal student loan borrowers must complete official entrance and exit counseling sessions as part of the borrowing process.
The government offers the entrance and exit counseling for free online, or your school might require you to complete them in-person — which is also free. You learn crucial information about how much you owe and how to pay it back, which can eliminate the need to pay for additional counseling services after your graduate.
You can also use independent online sources for financial advice. Student Loan Hero and the nonprofits American Student Assistance and Student Debt Crisis, for instance, provide thorough and up-to-date advice on student loan repayment options.
Online student loan calculators are another excellent resource for borrowers. These free calculators can help you better manage your loans and figure out how much you’ll pay each month.
For example, the FSA’s Loan Simulator can help you calculate your monthly payment (you’ll need to log in first to see your personal federal loan information). This online tool also allows you to view alternate repayment options to see how long you’ll make payments and how much you’ll spend on interest. That can help you decide if an income-driven repayment plan, which limits monthly payments to a percentage of your discretionary income, is a worthwhile option for you.
If you can afford to pay extra toward loans, our student loan prepayment calculator can show how much you’ll save in interest when making additional payments regularly.
If you have loans from multiple sources, it can be easy to lose track of your bills and miss a student loan payment.
A student loan counselor can help you track down and organize your loans, but you can do this without paying for student loan counseling first.
Access your loan balances and other details on your servicers’ websites or by calling their customer service numbers. If you’re not sure which servicers manage your loans, check your free credit report on AnnualCreditReport.com or use Federal Student Aid for your federal student loans.
Once you’ve found your loans, write down each loan balance, its repayment term, the monthly bill amount and payment due date — and figure out a way to keep track regularly and organize your payments.
Your loan comes with a built-in counselor — your student loan servicer. If you’re struggling to pay your loans, call your servicer and ask about your options.
For example, you may decide to apply for an income-driven repayment plan or use forbearance or deferment to postpone federal loan payments. Your servicer can help you accomplish these goals for free.
If you have private loans, you may find that some private lenders also offer flexible repayment options. Reach out to the company that collects your loan payments to explore ways to postpone or lower the monthly payments.
It’s important to advocate for yourself and ensure that any advice your servicer provides is in your best interest, however. Navient, a federal student loan servicer, has faced a recent legal battle involving allegations that the company didn’t steer borrowers into the lowest-cost repayment plans possible. Use additional resources, like government websites, to double-check the guidance you receive.
Some borrowers can benefit from nonprofit student loan counseling. At times, student debt can get so overwhelming that a sympathetic ear is necessary to show the way forward. If you have an especially complicated situation, you also may need to speak to an expert.
But before you pay for a student loan counselor, make sure the counselor you choose is reputable. The nonprofit National Foundation for Credit Counseling’s StudentLoanHelp.org resource can connect you with free or low-cost student loan counseling that’s personalized for you.
Marty Minchin contributed to this report.