Fed Financial

Any way to reduce payments on Sallie Mae student loans?

I have a friend who took out about $80,000 in private loans from Sallie Mae. She did not understand at the time that these loans would have an extremely high interest rate - it is now at about 18%, which means they are asking for $3,000 per month! She has been deferring her payments for the last year because she does not have enough income to pay this amount. Is there any way she can reduce this payment? Has anyone sued these guys for fraud? It seems like such a scam. Thanks in advance.

Public Comments

1. You can request "Interest only" payments that are lower monthly payments until you can afford more. You can also get a company to give you an estimate of a lower interest rate and then call Sallie Mae and let them know you are considering walking away from them bc you were offered a lower interest rate and you wanted to give them the opportunity to lower your interest rate and continue to make the money off your loan. Most of the time companies will take the deal to not loose you if you can tell them a competitors name, phone, person you spoke to that confirms they will give you a lower rate. *Please rate me "best answer" if you like my answer best.
2. Ask about an income contingent payment plan. They will look at what she makes, then determine what she can afford to pay. Deferring payment just makes things worse because all of the interest she's not paying gets added to the original loan amount, then she'll end up paying more. She needs to start making minimum monthly payments or she'll never get out of debt. Taking out loans is a huge deal. Just because she didn't understand that her interest rate was variable when she signed for the loan, doesn't mean she has any right to sue the company. Borrower beware!