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McCarthy law Plc legit? Student loan lawyer that gives loan to settle debt

Started by Beachguy2000, March 01, 2016, 02:25:43 pm

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Beachguy2000

Hi guys,long story short I fell into some hard times and defaulted on my private student loans a few years ago. I am now looking to fix my credit and move forward in my life.

I found a student loan attorney called McCarthy law. I spoke on the phone with them and was told they negotiate a settlement deal with the student loan lender, while I make monthly payments to the attorney. Once they agree to a settlement they have a personal loan lender that  they use that gives me a loan to pay the agreed upon settlement. From that point on my student loans are settled and I can work on repairing my credit making timely payments on the new loan. Is this legit? It almost sounds too good to be true how they can give loans to clients with obviously tarnished credit. I don't want to discount them but I am a little Leary. Any advice will help thanks!

TheCollegeInvestor

Here's our generic advice on student loan attorney's:

Be very careful in working with any law firm. Make sure that you ask them exactly what steps they are going to take in fighting your debt.

A lot of people get burned dealing with law firms trying to get their student loan debt dismissed.

Make sure they don't ever:
1. Ask you to stop making payments
2. Ask you to make payments to them

Both of these are big red flags that they are NOT trying to help you, and focused on other priorities.

Most people don't ever need a student loan lawyer unless you're struggling to get out of default, or you are being sued by your private lender.

If neither of these apply, all good lawyer will:
1. Validate that the debts are legitimate (which you likely know to be the case)
2. Validate that they haven't violated any debt collection laws (which you could sue them for violating)

You might still be able to get a settlement, but I would ask the attorney that you keep all money yourself and only pay for the attorney's fees. When you have a settlement, you can figure out your own financing.

Beachguy2000

Thanks for the reply. In regard to your point about not sending the law firm money, the person I spoke with said the reason behind that is so I can build a track record showing I can make payments for their lender they work with so they can approve me for their loan to pay the settlement. Is this an odd arrangement or even make sense?

TheCollegeInvestor

It's an odd arrangement, and the firm likely get's a commission from using that law firm. You're probably better off looking for a loan on a P2P lending site or a site like Credible. And do that IF/WHEN you get a settlement.