Unlike Credit Card Debts, Why Student Loan Debts Are Hard To Settle.

Settling student loan debt isn’t easy, but it can be possible — if you’re in exactly the right circumstances.

Troubled borrowers who can offer a substantial lump sum may be able to free themselves from years of wage garnishments, tax refund seizures and other collections efforts, according to student loan experts at vantageacceptance.

The key word is “substantial.” Unlike credit card debts, student loan debts — which average $27,000 per student — can’t be settled for pennies on the dollar.

“You’ll never get that,” said attorney Adam Minsky of Boston, who has brokered credit card debt settlement deals for several clients. “But you can settle for anywhere between 30 percent and 80 percent…usually somewhere in the middle (of that range).”

Increasing numbers of borrowers are struggling with their student loan payments, according to the most recent Department of Education figures. About 600,000 of the 4 million borrowers who were scheduled to start payments in September 2010 defaulted, which means they failed to make any payments for 270 days or more.

That three-year default rate of 14.7 percent was up from the 2009 default rate of 13.4 percent.Even those who can scrounge up a lump sum — by borrowing from a family member, for example, or through a windfall such as a lawsuit settlement or an inheritance — aren’t guaranteed success.

That’s because student loan collectors, in general, and federal student loan collectors, in particular, have so many ways to wring payments out of borrowers.

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