Repaying New Jersey HESAA Loans

One of the great features of federal student loans is that you can get a repayment plan that tracks your income. Monthly payments can be capped to either 10% or 15% of your disposable income and adjust up or down over 20 to 25 years. It is essential to understand that not everyone pays for all of college with federal loans. As an experienced New Jersey student loan lawyer, I know how to negotiate repayment plans to help you get out of student loan debt.

But What About CLASS Loans from HESAA?

In New Jersey, the Higher Education Student Assistance Authority (HESAA) offers CLASS student loans to people who live or attend school in the state. These loans can help cover any shortfall in the cost of attendance after federal loans and grants have been exhausted, but they don't come with many advantages.

People would graduate and discover that they have a huge amount of CLASS loan debt and a monthly payment that is just unaffordable. They may be able to get a forbearance or deferment while they get a job or figure out what they will do, but that is not a long-term solution. There are no income-driven repayment plans for these loans.

Income-Driven HESAA Repayment Plans 

In 2019, Governor Murphy signed a bill allowing borrowers to get into a repayment plan more suited to their economic situation. After filling out a simple, one-page financial disclosure form (and attaching paystubs and tax returns), they will look to put you into a no-interest repayment plan that can stretch out as long as 30 years.

This bill may sound great, but it does have you paying for quite a long time and has tax consequences. Although there is no interest on the payment plan, it does accrue and is discharged at the end of the repayment term. This forgiven debt can be considered taxable income by the IRS.

Negotiating a Repayment Plan

As a student loan lawyer, I have successfully negotiated these repayment deals with HESAA. If you need to get into a plan like this because you can't afford your current payment or are in default, you live in New Jersey, know you need to do something about your loans, and you are ready to take action, then please click on this link to schedule an initial call to discuss your case. Put my experience to work for you.

Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.