No one wants to get the dreaded notice that their New Jersey College Loans to Assist State Students (NJCLASS) loan is in default. But it happens, and if you don’t take action, it can spiral into a major financial headache. Debt collection lawsuits, wage garnishments, bank account levies - the consequences of default are serious.
The good news? There are options to get your loan back in good standing and on an affordable repayment plan, even if you’re already being sued by the New Jersey Higher Education Student Assistance Authority (HESAA). Here’s what you need to know.
The Dangers of Ignoring Default
When you default on your NJCLASS loan, HESAA turns your account over to a collection law firm. This sets in motion a litany of repercussions:
- Your credit score takes a nosedive, making it difficult to qualify for other loans, credit cards, or large purchases like a home or car.
- You become vulnerable to wage garnishment, where up to 15% of your disposable pay can be seized. This leaves you struggling to make ends meet.
- Your bank account can be levied, draining the funds you worked hard to save.
- Significant collection fees and interest get tacked onto your loan balance, inflating the amount owed.
- You may be taken to court by the collection law firm, resulting in a judgement against you if you do not respond. This judgement follows you for years.
The fallout affects not just you, but any co-signers on the loan as well. Simply hoping the problem goes away or ignoring calls and letters from collectors only makes matters worse. But the good news is, there are solutions.
Get Your Loan Back in Good Standing
If your NJCLASS loan is in default but you haven’t suffered garnishment yet, you have options to get back on track. The first step is contacting HESAA or the collection law firm directly to ask about rehabilitation or consolidation of your loan.
Rehabilitation allows you to make nine on-time monthly payments based on your financial situation to bring the loan out of default. Consolidation rolls the NJCLASS loan into a new Direct Consolidation Loan with affordable monthly payments. In either case, you get the loan back in good standing so you can repair your credit and avoid harsh collection actions.
If you already know you want experienced legal help negotiating the rehabilitation or consolidation process, you can click here to schedule a call to discuss your situation with me. I can walk you through the best options.
Don’t wait - the consequences of remaining in default on your NJCLASS loan will only compound. By taking action now, you can get your finances back on track and avoid wage garnishment, bank levies and other collection actions that create financial havoc. Reach out to me today to discuss your options and find an affordable solution.
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