There’s nothing a student loan counselor will tell you that you can’t learn on your own.
That may sound like a bold statement, but it’s true. There’s a wealth of information and resources online to help you manage your student loan debt.
That’s not to say student loan counseling is never helpful. If you’re facing a ton of debt, you might gain peace of mind from speaking one-on-one with an expert.
But most borrowers are fully capable of managing their student debt without a student loan counselor. Here are five important reasons you should think twice before paying for student loan counseling.
1. Some student loan counseling services are scams
As the student loan debt crisis in America continues to grow, student loan scams are popping up. These predatory services target vulnerable borrowers with false promises of loan forgiveness.
Although legitimate loan forgiveness and assistance programs do exist, none offer immediate loan cancellation. You’ll typically need to work for years before qualifying for a program such as Public Service Loan Forgiveness.
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 up-front fees, or share personal details, like your Social Security Number.
Unfortunately, scammers are out there posing as student loan counselors. If a service seems sketchy, don’t waste your time or money.
2. A wealth of expert advice is available for free online
Although student loan counselors can help you navigate your student loans, they don’t have exclusive knowledge. In fact, you can find expert advice on student loan management online for free.
If you have federal student loans, the Office of Federal Student Aid (FSA) website is a good place to start. The FSA site details the various student loan repayment plans, plus it has information on forgiveness programs.
You can also use independent sources for financial advice. Student Loan Hero and non-profits American Student Assistance and Student Debt Crisis, for instance, are all committed to providing thorough and up-to-date advice.
If you’re looking for unbiased student loan advice, there’s an abundance of resources online. Instead of paying for a student loan counselor, you can learn everything you need to know on your own for free.
3. Student loan calculators can help you understand your debt
Student loan calculators are another excellent resource for borrowers. These free calculators help you better manage your loans.
For example, the FSA website has a “repayment estimator” for calculating your monthly payment. You can adjust your monthly payments to see how long you’ll pay and how much you’ll spend on interest.
If you can make extra payments, you can use a student loan prepayment calculator. It shows how much you’ll save in interest by making regular extra payments each month.
Alternatively, you can use an Income-Based Repayment (IBR) calculator to understand what your bills would look like under an IBR Plan. You’ll pay less each month and extend your terms to 20 or 25 years.
There are a wealth of online calculators that offer insight into your student loan situation. Instead of paying a student loan counselor to crunch the numbers, you can easily do so yourself.
4. Free tools could collect your debts in one place
Do you have loans in multiple places? It’s all too easy to miss a payment if you’ve lost track of your student loans.
A student loan counselor can help you gather your data in one place. But besides helping you get organized, the counselor isn’t doing anything you can’t do.
If you have more than one loan, track down your loans through your online accounts on your servicers’ websites or by calling their customer service numbers. If you’re not sure which servicers your loans are under, you can download your free credit report on AnnualCreditReport.com or use the National Student Loan Data System (NSLD).
Once you’ve found your loans, write down each loan amount, repayment term, monthly bills, and payment due dates.
The Student Loan Hero dashboard is one tool for collecting all your loans in one place. It gives you a bird’s eye view of all your loans at once. Plus, the dashboard shows what progress you’re making on each.
A student loan counselor can help you track your loans, but you can take this step without paying for student loan counseling first.
5. Your student loan servicer can explain your options
Finally, your student loan servicer is also a useful resource. If you’re struggling to pay your loans, call your servicer and ask about your options.
For instance, you may choose to put your federal loans into forbearance or deferment, or you could apply for an income-driven repayment plan. Your servicer can help you accomplish these goals for free.
Some private student loan servicers also offer flexible repayment options. CommonBond, for example, allows for temporary forbearance in the case of economic hardship.
That’s why you should cross-check any advice against a trusted source, whether it’s an official government website or a reliable finance blog.
Explore your options before you pay for a student loan counselor
Student loan counseling can be useful for some borrowers. Sometimes, student loans get so overwhelming that we need a sympathetic person to show us the path forward. If you have an especially complicated situation, you may benefit from speaking to an expert.
But before paying for a student loan counselor, explore your options. There’s a ton of free online resources to teach you how to manage your student loans.
If you’re still interested in student loan counseling, beware of any scams. Here are three red flags to watch out for when choosing a student loan counselor.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 5.87% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 5.87% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 5.87%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|