What is Student Loan Document Preparation?
Updated on June 28, 2018
When you are trying to reduce your student loan payments, you will inevitably need to file documents with your servicer. These documents are sometimes confusing and not clearly identified so you know which document to file for what repayment plan. Enter student loan document preparation companies. These are companies who claim they will help you complete the correct documents so you can get the repayment plan you want.
What Does a Student Loan Document Preparation company Do?
This is an interesting question. You would think they help you to perform student loan document preparation and give you guidance on how to fill them in. However, most of these companies do not stop there. Why you ask…because they see an opportunity to take advantage of your situation. Since they are not typically lawyers or financial advisors, they cannot give you legal or financial advice. Although, many do when they say they will help you select the plan that is right for you. Truthfully, how can they possibly know what is right for you?
How Do They Profit From Student Loan Documentation Preparation?
Most of the time, these companies have a salesman who works on commission trying to be your friend in order to get the sale. They make plenty of assumptions and steer you into a plan which might lower your payment, but may also have implications later they do not tell you about. Some even tell you to complete a deferment or forbearance so you can immediately stop making student loan payments and pay the student loan document preparation company instead. It is how they make sure you can pay them the many hundreds of dollars they want to fill out the form.
What To Look For In A Student Loan Document Preparation Company?
They should be transparent about their fees. Since they have no legal or financial expertise, there is little reason to vary pricing.
- You should be able to get their price without having to share your situation.
- They should have a good rating with an accredited consumer organization such as the BBB.
- Their fees should be less than an Attorney or Financial Advisor, again since they have no expertise.
- They should provide the option for you to do it yourself with support.
If you ask a student loan document preparation company about their pricing, for forms, if they can send you the forms and if they can provide the student loan analysis they use to make their recommendation to you and they refuse, run!