We meet people almost every day that have large student loan payments.? Unfortunately, as we have discussed in the past, most student loans are not dischargeable.? While the payments can be made through a Chapter 13 Bankruptcy, they will not be discharged.? While we try to assist our clients in any way possible, the bankruptcy code and case law somewhat limit us in this area.? This can leave our clients unsure of how to proceed.? A quick internet search of loan options will produce an overwhelming amount of information, and much of that information is contradictory to other sources.? It can be hard to know where to turn for answers.? Another unfortunate truth is that many student loan companies do not do much in the way of offering help to the people that need it the most.? Even when the companies do offer help they don’t always properly explain the options and the implications associated with those options.?

It is easy to see why people turn to student loan assistance companies.? People think they are dealing with experts in their field, companies that understand and care, and companies that can actually help.? Unfortunately, many of these companies are predatory in nature and these companies. Sadly, these practices primarily imp Remember, if they are offering to help you they are getting something out of the deal.? This loan assistance companies are for-profit entities that are making money off of the advice they give you.? Many of these companies offer the world and seem to ask for very little in return.? Word to the wise: if it seems too good to be true it probably is!

However, in the last few week the Illinois Attorney General has decided to do something about this.? The Illinois Attorney General has filed two law suits this month, one against Broadsword Student Advantage, LLC and the second against First American Tax Defense, LLC.? The long and short of the allegations the Illinois Attorney General has included in the complaint against Broadsword Student Advantage is that the offered to reduce payments, reduce interest rates, and or consolidate loans, however, they were charging people a fee of $499 up front and a recurring monthly fee of $49 when this information is available for free to lenders. ?Further, the services Broadsword claimed to offer we not all available to consumers.?

In the second case the Illinois Attorney General has filed, against First American, the state alleges that First American offered to get lower payments, obtain forgiveness of loans, and the ability to fix credit scores.? First American was charging $1,199 and up for these services, which are otherwise free to lenders.

Basically, you should take a few things from this.? First, is to be careful.? Second, while these cases were filed as violations of Illinois laws it will be interesting to watch and see how those cases come out and whether other states begin to follow suit.? ??

If you have questions about this, or any other bankruptcy question, please feel free to contact your St. Louis Bankruptcy Attorney today!