What is Financial Hardship Assistance?

You may declare financial hardship to lower the payments on most of your loans. This does not mean you will not have to repay the loan, but it means that your lender may offer you flexible terms. Depending on the type of hardship you have experience, a lender can delay, reduce or waive speicific amounts of debt. Many consumers consider financial hardship assistance as an alternative to bankruptcy.

Debt Relief for Hardship

Debt relief options may be available. Debt relief offers a portion of your debt to be forgiven, depending on the circumstances you describe in your hardship letter. A hardship letter is submitted to the lender. For example, a lender may offer to forgive or reduce a debt if you have lost your job or suffered a large medical emergency. 

Debt Deferral for Hardship

Debt deferral is a different option for those experiencing financial hardship. It allows you to put off making payments for a determined amount of time, sometimes at low or no interest. For example, if you have received a job offer but the company is deferring your employment until a date in the future, you may declare financial hardship and try to pay loans off after you begin your employment. 

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