Our team has over 45 years of combined experience assisting individuals who are suffering from student loan debt. We offer different solutions based on each individual situation. Clients wishing to reduce their principle balance will likely hire us for a student loan modification. Please read below to understand who is eligible for modification and how our solutions work.
Determining Eligibility for Student Loan Modification
The most important part of the process is ensuring you are eligible for a student loan modification or complete cancellation of your student loan.
If you meet one of the criteria descriptions below, you may be eligible for an attorney-based student loan modification:
- Student is facing an “undue hardship” as a result of student loan debt
- Did not graduate
- Misled about potential job placement
- Student has encountered some type of disability
- Student feels they were misled or coerced into taking large loans for education
- Was a minor when commitment was made for student loan
- Student not benefiting from education
- Feels trapped in an abusive loan contract with high interest
- Misled about student loan “forgiveness” options
- Has had to defer payments or request forbearance options
- Student feels they did not receive what they paid for
- Simply cannot afford ongoing payments
- School or University attended is no longer open
If you think you may be eligible, fill out our start now form to initiate the process.
Once we review your situation and approve your eligibility for our services, it typically takes about 14 days to start the process.
1. We will send the lender a letter of representation and advise them to cease all direct communication with you and direct all future correspondence, other than regular notices and monthly bills to our office.
2. We will assert your rights under the “Federal Fair Debt Collection Practices Act” so that you will not be burdened by the incessant phone calls that occur once you become in default and the regular payments to your lender ceases.
3. We will then provide your lender with financial information about your income and expenses so the lender can make an informed decision about whether or not they would make more money by settling than by pursuing the debt.
4. We will review your file to see if there are any irregularities in its origination or payment terms.
Unless you are prepared for the potential negative impact that a default in your loan may have, you should not pursue a student loan modification.
This does not mean, however, that all debt negotiation results in negative credit reporting. If there is negative credit reporting, we have the tools at our disposal to assist you in mitigating the damage.
While there is never a guarantee that any lender will negotiate with you, the likelihood of success is greatly enhanced once you hire an Attorney-Based service.
You do not have to suffer financially and you are far from alone. Over 40 million Americans are burdened by Student Loan Debt.
Many are taking action, learning if they can modify their student loan debt and regain control of their financial future.
To see if you are eligible, click here and fill out our free evaluation form. You may also call our office during regular business hours at: 800-632-7967. Thank you.
Frequently Asked Questions
How much will this service cost?
We charge 10% of your current loan balance. For example: If you owe $100,000 in student loan debt and we are successful in reducing the principle loan balance by at least 30%, you would pay us $10,000 upon completion of the loan modification. If we reduce the loan by more than 30%, or if we are able to cancel it out completely, our fee would remain the same. Our minimum loan modification service fee is $3,000 and can go up to $20,000, based on your loan amount and situation. We offer zero-down financing for approved clients with at least a 600 FICO score. We also guarantee in-house financing for those who don’t qualify for zero down financing. All of our financing options include affordable monthly payments and interest as low as 4.99%. There is no pre-payment penalty. All loan modification customers are required to post the service fees to Escrow.com before we initiate services. Once we are successful in modifying the loan, you will be required to release the escrowed funds to Iron Fist Legal, LLC. The process can take up to 2 years to complete, however we expect a 4-6 month window for completion.
My school closed. Am I eligible for relief?
There has been a widely reported problem of colleges closing and leaving students in debt without having received the education they paid for. Relief in these situations is available for those who paid for an education through Federal Student Loans to schools which closed prior to or shortly after completing the educational program, known as “Closed School Debt Relief”. Contact us right away if you believe this situation may apply to you.
Who is not eligible for Closed School Debt Relief?
Borrowers for which the schools directly misled students in connection with obtaining Federal Student Loans and they completed their education before the school closed or the school remains open are ineligible for debt relief through Closed School Debt Relief.
What is Borrower Defense?
Due to colleges having obtained funds from student loans by deceptive means leaving the student borrowers with the debt and without the promised educational advancement, the “Borrower Defense” was made into law on November 1, 2016. The defense provides debt forgiveness of Federal Student Loans under certain circumstances of wrongful acts by the schools.
It finally went into effect after the US District Court ruled on BAUER V. DEVOS in 2018. The delay in implementing the program was unreasonable and the program must finally begin to provide relief to borrowers who obtained Federal student loans as a result of being misled by educational institutions.
Are there any limitations to Borrower Defense?
The Borrowers Defense only provides a means of forgiveness for currently owed Federal Student Loans. Private student loans are not covered under Borrowers Defense and private loans cannot be forgiven or reduced nor put into forbearance or stop collections under this program.
This limitation would also apply if a loan that was originally a Federal Student Loan, but was subsequently refinanced by the borrower with a private lender as in the process the Federal Student Loan would have been paid off and the current loan would be a private one. Federal Student Loans include Federal Direct Consolidation Loans, Direct Federal Loans, and Federal Family Education Loans (FFEL).
What happens if you qualify for Borrower Defense?
Those who qualify for Borrowers Defense Loan Forgiveness will have their debt reduced or eliminated completely, depending on the particular circumstances of their individual claim, even if repayment has already begun.
The program provides forgiveness of a loan wrongfully obtained, absolving the borrower of the debt or a portion of their outstanding debt along with possible reimbursement of any portion of the loan that has already been repaid.
Does my school have to be closed for me to be eligible for Borrower Defense?
Unlike the Closed School Debt Relief program, the school which misled the borrower does not have to be one that has closed its doors. Forgiveness is available to borrowers regardless of the school having closed, the educational program the borrower was in still being discontinued, or the school and program still being open to conduct classes.
Who specifically qualifies for Borrower Defense?
The requirement is limited to only borrowers who received a Federal Student Loan if the loan was obtained due to misconduct of the educational institution as mentioned above. Forgiveness is not available if the loan was not obtained by misconduct by the school in direct relation to obtaining the loan.
For example, simple lack of employment after graduation, being personally dissatisfied with the education provided, harassment by school faculty, injuries which occurred at the school, or any other reason not directly related to the Federal Student Loan or the educational services the school provided from obtaining the loan would be ineligible for Borrowers Defense Loan Forgiveness.
What is the process for relief under Borrowers Defense?
To apply for relief under Borrowers Defense, an application must be filed via an online form with the Department of Education, or a form must be completed and mailed or emailed to the Department of Education. A borrower who attended multiple educational facilities is eligible for relief if more than one misled or defrauded the borrower in connection to the student loan for each school that the loan applies to. Also, if the same institution was attended for different degrees, relief is available as well. In each case, the borrower must make a separate application and show how the school misled the borrower for each claim.
In applying, the borrower will have to provide:
Their name, date of birth, social security number, phone number, address, and email address
The information of the school they attended, which does include on-line campuses as well as “brick and mortar” facilities
Date of enrollment
Educational program or major the student enrolled in
Degree or Credential sought in attending the educational program
Current status in the educational program
If they have had any other student loans forgiven
If they have made any attempts to recover tuition paid to the school
What the borrower believes the school stated or failed to disclose
How the school communicated the information
Name and title of the people who misled, if known.
Why it is believed the school misled as to the education other matters directly related to the loan
For Borrower Defense, does it have to be the student that attended?
No, the borrower does not have to be the student that attended. The program is available if a parent took out the Federal Loan on behalf of the student who the loan was for not just if the borrower took out the loan themselves personally.
What Current Litigations Should I be Aware of Regarding Borrowers Defense?
Despite having been implemented and the court ordering the program to commence, there is current litigation due to the failure of the Department of Education from processing applications for relief under Borrowers Defense. At the time of this writing, while over 160,000 applications have been submitted and awaiting determination, the Department of Education has not granted nor denied any applications since June of 2018 leaving a great many borrowers in limbo as to their Federal Student Loans.
While those who properly submitted applications can have a forbearance or stop collection to prevent payments from having to be made and the loan not go into default, interest on the debt still accrues. This can prevent a student from being able to obtain other Federal Student Loans or other financial aid to get the education they had believed they were going to get, or a different path, in order to qualify for productive employment.
This additional interest while awaiting a determination can have a substantial financial effect as the additional interest must be paid if the claim for forgiveness is denied or only partly granted.
The lawsuit does not stop borrowers who were misled by the college in obtaining their Federal Student Loan from seeking forgiveness under Borrowers Defense.
The lawsuit seeks to have the court order the Department of Education to grant or deny claims under Borrowers Defense and end the policy of indecision. Even though the lawsuit does not prohibit new claims to be filed, the current situation of lack of processing of claims by the Department of Education which has led to the lawsuit should be kept in mind.
How are repayment programs with zero monthly payments addressed?
Borrowers that believe they were misled by the school in relation to their loan and are currently under a repayment program which assesses the monthly repayment amount due as zero, having their loan placed into forbearance would be a detriment. The is due to the present zero due payment being considered on time payments for the purpose of the duration of the Federal Student Loan toward the expiration forgiveness that may apply.
For these students, they can apply for Borrowers Defense Forgiveness without having forbearance applied to their account. This allows the process for review of the claim for forgiveness of the loan without losing the on-time payments of zero counting toward their long term loan status should the claim be denied.
To be eligible for forgiveness under this situation, the school has to have done one of the following:
The school misled as to the educational services for which the loan was provided to pay for.
The school obtained the student loan by use of misleading activities or other misconduct.
Can payments be stopped when I have submitted an application for forgiveness?
While the application for forgiveness is under review, a borrower can have their loan placed in forbearance or to have collection stopped pending the determination of the application. This will allow a borrower to stop payments while awaiting the decision regarding forgiveness. This also allows for payments to stop after the application is filed without penalty and without the loan going into default. Interest would continue to accrue during this time and would have to be paid if the application is ultimately denied.
Is there an Impact on Corinthian Colleges?
Borrowers who attended Corinthian Colleges, which include Everest Institute, Heald College, and WyoTech campuses, are subject to a current injunction due to an ongoing lawsuit which has put a hold on forgiveness for students who attended these schools while the case goes through the court.
This injunction applies to borrowers who attended these schools and believe they were misled by the schools misrepresenting job placement rates of some of the educational programs offered.
Borrowers that attended these schools before April 27, 2015 can obtain loan forgiveness if they can show they were defrauded by Corinthian or the school engaged in actions which violated State law no matter when the school closed. For those who attended a Corinthian school that closed on April 27, 2015 may be eligible for relief on their Federal Student Loan though Closed School Debt Relief.
What About Corinthian Colleges and Loan Forbearance?
Even though forgiveness is currently unable to be given under Borrowers Defense due to the injunction, those who believe they were misled or defrauded by Corinthian can still apply and relieve loan forbearance to allow the borrower to stop paying on their loan without going into default, or for collections to be stopped if their loan is already in default.
Can I Discharge my Student Loans through Bankruptcy?
While discharging student loans may be difficult, it is not impossible. To effectively do so, you must show that payment of the debt “will impose an undue hardship on you and possibly your dependents.”
Courts use different tests to evaluate whether a particular borrower has shown an undue hardship. The most common test is the “Brunner Test,” which requires a showing that:
1) The debtor cannot maintain, based on current income and expenses, a “minimal” standard of living for the debtor and the debtor’s dependents if forced to repay the student loans;
2) Additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans
3) The debtor has made good faith efforts to repay the loans.
(Brunner v. New York State Higher Education. Services. Corp., 831 F. 2d 395 (2d Cir. 1987).
Most, but not all, courts use this test. A lot has changed since this 1987 court decision and some courts have begun to question whether they should use a different standard. For now, most federal courts of appeal have adopted the Brunner test, but the law in this area is changing.
What if I can prove undue hardship?
If you can successfully prove undue hardship, your student loan will be completely cancelled. Filing for bankruptcy also automatically protects you from collection actions on all of your debts, at least until the bankruptcy case is resolved or until the creditor gets permission from the court to start collecting again.
Assuming you can discharge your student loan debt by proving hardship, bankruptcy may be a good option for you. It is a good idea to first consult with a lawyer and/or another professional service to understand all of the pros and cons associated with bankruptcy.
For example, a bankruptcy can remain part of your credit history for up to ten years. There are many costs associated with filing for bankruptcy as well as a number of procedural hurdles. There are also limits on how often you can file for bankruptcy.
Whether a student loan is discharged based on hardship is not automatically determined in the bankruptcy process. You must file a petition (called an “adversary proceeding”) to get a determination.
If you have already filed for bankruptcy, but did not request a determination of undue hardship, you may reopen your bankruptcy case at any time in order to file this proceeding. You can do this without payment of an additional filing fee.
What if I have trouble locating the documents needed?
Not to worry! If you need help obtaining any of the documents please feel free to call us during business hours at 800-632-7967.
What if I’m already behind on payments to my student loans?
This is completely normal and will have no effect on the outcome of our process.
How long will the process take?
From beginning to end, the process can take 14 days to start and up to two years to complete. Most files will process in less time but we like to under-promise and over-deliver!
Will there be an actual attorney involved in the process?
Yes, an attorney will be involved in the modification process. You will be required to authorize an official “Power of Attorney” document before the loan modification can be processed.
Is this service guaranteed?
We are proud of our “Iron Fist Guarantee,” which says we will reduce your student loan debt principle balance by at least 30% or more, or you would pay nothing for our services.