Why are student loans so complicated?


A common question I get from borrowers across the U.S. is this:

Why are my student loans so complicated!

Honestly, it’s because of many reasons.

One of the main reasons is that there are many different types of loans, and many different lenders. Each lender has different rules for how it wants to be paid back, and each offers different types of repayment assistance.

To boot, each lender is not so good at explaining precisely how they want to be paid back, in plain English. They’re also not so great at explaining your repayment assistance options, as the $1.2 trillion national student debt situation shows!

Consider it this way: having different lenders offering advice about each of your loans is like having a different financial advisor offering advice about every sector of your financial portfolio.

For example: Jim handles your checking account. Jane manages your savings. Fred works with your stocks. Cynthia is in charge of your bonds. George is managing your credit card debt. Mary is managing your mortgage payments…

…and each person can only advise you with one area of your finances — without understanding how their guidance will impact the rest of your financial landscape!

Ay yai yai. So, the customer service reps at Sallie Mae obviously can’t advise you with what to do with your Nelnet loans, and the Nelnet customer service reps can’t tell you what to do about your Parent Plus loans… etc. etc.

This conundrum is exactly what is making student loans so complicated. Well, it’s part of the issue, anyway.

Long story short: No one student loan lender (or rather, their customer service reps) is an expert on all the other types of student loans.

In fact, most lender customer service reps barely understand the loans you hold with their employer, nevermind what’s going on with all your other loan types/lenders/servicers in the student loan lending industry!


Different Lenders, Different Worlds

At the broader scale, private lender customer service reps are not familiar with federal loan regulations, since the loans they work with do not have to adhere to them.

And federal loan lender reps have no idea how to manage a private loan, since private loans are not bound by the same regulations that federal loans are.

To top it off, Perkins Loans, Plus Loans, Alternative Loans and school lines of credit (along with their various interest rates and dates of origination) exist completely independently of each other.

So when the time comes to make sense of and manage the repayment of all of these loans, all of these complications can really throw a borrower in for a loop! (In fact, just explaining this can get very confusing.)

In sum, the complicated nature of the loans themselves, PLUS the very narrow, specialized knowledge that any single lender has, are two of the main reasons why student loan debt is now posing a $1.2 trillion challenge to our country. And our sanity.


Next Steps

If you’re feeling overwhelmed by your federal and/or private student loan debt, or simply need someone to talk to to get more clarity or control over it, please click here to schedule a free consultation with me.

I’ve worked for many years in the student loan industry, and the financial services industry, and it’s now my (very rewarding) help every borrower I speak with.

I look forward to pointing you in the right direction, and helping you make sense of your student loan debt. I assure you, it’s possible!

Your student loan portfolio may or may not be a good fit for my services. Regardless, during our consultation, we’ll make sure YOU know how to make your student debt repayment experience the very best it can possibly be.

In service,




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