FAFSA Fresh Start program - Is this legit or another predatory loan tactic?

The Fresh Start program is actually legitimate - it's a Department of Education initiative to help borrowers with defaulted federal loans. It does get your loans out of default and stops collection activities, but you're right that it doesn't offer forgiveness. The main benefits are: - Removed collection fees - Default status removed from credit reports - Restored eligibility for income-driven repayment plans (which could be much lower than your previous $475) - Restored eligibility for additional federal student aid if you want to return to school Bankruptcy for student loans is still extremely difficult. You'd need to prove 'undue hardship' which courts interpret very narrowly. Fresh Start is likely your better option, especially if you qualify for income-based repayment that could be as low as $0 monthly if your income is low enough.

i got one of those 2. said some BS about 'restoring my financial future' lol. whole system is RIGGED. i paid almost DOUBLE what i borrowed over 6 yrs and they still say i owe $24K!!! how is this even legal?? 😠 my cousin tried this fresh start thing and they just put him on some plan where he still pays $$$ every month. its just a trick to get u back on the hook.

Fresh Start is legitimate but you need to understand what you're signing up for. The program ends SEPTEMBER 30, 2025, so it is time-limited. Here's what happened with mine: 1. I called my loan servicer directly (didn't trust the letter initially) 2. They confirmed it was real and helped me fill out the request form 3. My loans came out of default status within about 4 weeks 4. I immediately applied for the SAVE income-driven repayment plan 5. Based on my income, my payments were set at $73/month instead of the original $340 The key is to NOT just accept whatever payment plan they initially suggest. You MUST specifically request an income-driven plan after the Fresh Start process completes. If you don't, they'll put you on a standard plan with much higher payments.

Yes, exactly! It's two separate steps, and they don't always make that clear: 1. First step: Get out of default through Fresh Start 2. Second step: Apply for an income-driven repayment plan And yes, when I first called, they tried to put me on a standard repayment plan that would have been around $250/month. I had to specifically ask about income-driven options. When I mentioned the SAVE plan by name, suddenly they were much more helpful about getting me the lower payment. Also, with your income at $1,800/month, you might qualify for very low or even $0 payments under SAVE, depending on your family size and state.

my sister tried this fressh start thing and it actually worked for her but its not forgiveness, just stops the collections calls and fees. she still owes all the money but at least the payments r based on how much she makes now

I've been trying to reach someone at Federal Student Aid for WEEKS about Fresh Start - constant busy signals, disconnects after 2 hours on hold, and website errors. I finally found a service called Claimyr that got me through to an actual human at FSA in less than 30 minutes. They have this priority line service where they wait on hold for you, then call when an agent picks up. Saved me so much frustration! I watched their demo video first (https://youtu.be/TbC8dZQWYNQ) and it worked exactly like they showed. Their site is claimyr.com if anyone else is trying to reach FSA about Fresh Start or anything else.

Yes! The FSA rep I finally spoke to was actually really helpful once I got through. She explained all the income-driven options in detail and ran the numbers for my specific situation. The letter only mentions the basics, but there are actually 4 different income-driven plans with different calculations (IDR, PAYE, REPAYE, and the new SAVE plan). The agent told me the SAVE plan is usually the best option for most people right now. She also confirmed what others have said - Fresh Start is just to get out of default, then you need to immediately apply for an income-driven plan as a separate application. If you don't, they automatically put you on a standard 10-year repayment plan with much higher payments.

unpopular opinion but bankruptcy ISN'T going to help with student loans - courts almost NEVER discharge them, i tried 2 yrs ago and got denied even with a good lawyer. fresh start + SAVE plan might be ur best option rn unless u qualify for disability discharge

Just to add some clarity on bankruptcy and student loans - while it's still difficult, there have been some recent court cases that have made it slightly more possible than before. The key is meeting the "Brunner test" criteria: 1. You cannot maintain a minimal standard of living while repaying the loan 2. Your financial situation is likely to persist for much of the repayment period 3. You've made good faith efforts to repay That said, Fresh Start combined with an income-driven repayment plan is still the more guaranteed path for most borrowers. With the SAVE plan specifically, if your income is low enough, you could get $0 monthly payments that still count toward eventual forgiveness after 20-25 years. Also, if you've truly paid back more than you originally borrowed as mentioned in your first post, you might want to request your complete loan history to verify where all those payments went. Sometimes a significant portion goes to interest rather than principal.

One more important thing about Fresh Start that no one mentioned yet - if you have wage garnishment or tax refund offsets happening now, those stop immediately when you enter the program. For me, that was the biggest immediate benefit since they were taking 15% of each paycheck. After Fresh Start, that stopped, and then with my income-driven payment being much lower, it made a huge difference in my monthly budget. Also, entering Fresh Start doesn't restart the clock on forgiveness options. If you've made qualifying payments before defaulting, those still count toward the 20/25 year forgiveness timeline under income-driven plans.

Just wanted to add that when you do Fresh Start, make sure to keep detailed records of everything - save copies of all forms you submit, confirmation numbers, and dates of phone calls. I've seen cases where people had to resubmit paperwork because the servicer "lost" it or claimed they never received it. Also, once you're in the program, don't ignore any communications from your servicer. They'll send you forms to complete the process and if you miss deadlines, you could get kicked out of Fresh Start and go back to default status. The whole process took about 6-8 weeks for most people I know who've done it. Good luck with getting this sorted out! The fact that you're asking the right questions and doing research shows you're approaching this smart.