Is it legal for a private student loan lender to charge me more than 8% of my disposable income on payments?

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Is it legal for a private student loan lender to charge me more than 8% of my disposable income on payments?

I showed my student loan statements to someone who worked in the finance industry, they said i was being charged 124% of my disposable income for payments which seemed legally questionable.

Asked on October 23, 2010 under General Practice, Texas

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

First of all, student loans are loans acquired to obtain a degree.  It is a contract into which you enter theoretically prior to entering any type of employment.  Student loan rates are not contingent on your income though if you do have a low income, you may qualify for some sort of forbearance of your loan for a few months or a graduated rate of payment for a number of months or years.  Oftentimes banking department agencies or offices of the attorney general or department of education in your state can and do have jurisdiction to review your student loan education related complaints.  Consider doing some research on your terms and if you qualify to obtain a lower payment and consider exploring your options in filing a complaint if your state as usury laws with respect to loan rates (rates charged and considered a consume credit item).


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