For millions of Americans, the pursuit of higher education has come with a staggering price tag. In Texas, the burden of student loans is a daily reality for recent graduates, established professionals, and families alike. Whether you are navigating complex federal regulations or facing aggressive collection tactics from private lenders, the stress can feel overwhelming.
Many borrowers suffer in silence, unaware that strong legal protections exist to shield them from predatory practices and unmanageable debt. Understanding Your Rights is the first step toward regaining financial freedom. You are not at the mercy of your servicers, and you do not have to face this battle alone.
At Cannon Legal PLLC, we believe that everyone deserves skilled advocacy when navigating complex financial disputes. This guide explores your protections under federal and Texas law, explains the critical differences between repayment, forbearance, and deferment, and details how a dedicated attorney can help you pursue loan discharge or defend against lawsuits.
To effectively manage your debt, you must first identify the type of loan you hold. The laws governing student loans differ significantly depending on whether the debt is federal or private.
Backed by the U.S. Department of Education, these loans offer the most robust consumer protections. They are eligible for Income-Driven Repayment (IDR) plans, forgiveness programs (like PSLF), and specific discharge options. However, the government has extraordinary collection powers, including tax refund seizures and wage garnishment without a court order.
These are issued by banks, credit unions, or other financial institutions. Private student loans operate much like credit card debt or auto loans. While they lack the flexible repayment options of federal loans, private lenders must sue you in civil court to garnish wages or seize assets. This is where Texas state law becomes a critical shield for consumers.
In Texas, we serve clients in Tarrant, Denton, Dallas, Collin, and Parker counties, helping them navigate the specific state statutes that protect borrowers from harassment and time-barred debt collection efforts.
Borrowers often assume that once they sign a promissory note, they have no recourse. This is incorrect. You have specific rights regarding how your loan is serviced, how collectors interact with you, and how accurate your credit reporting must be.
If you fall behind on payments, you are protected by the Fair Debt Collection Practices Act (FDCPA). Third-party debt collectors cannot harass you, call at unreasonable hours, or make false threats. Our attorneys are experienced in debt collection defense and hold collectors accountable for harassment and violations of consumer rights.
Your student loans must be reported accurately to credit bureaus. Errors in reporting can devastate your credit score, affecting your ability to buy a home or car. We represent clients in disputes involving the Fair Credit Reporting Act (FCRA), ensuring that inaccuracies regarding your loan status are corrected.
Not all loans are issued in good faith. Some for-profit schools and private lenders engage in deceptive practices. We challenge predatory lending practices and provide critical support for those burdened by student loans that may have been issued based on fraudulent enrollment data or misleading job placement statistics.
If you are struggling to make monthly payments, simply stopping payment is the worst option. Instead, you should proactively explore structured repayment plans.
For federal loans, IDR plans cap your monthly payment at a percentage of your discretionary income. In some cases, your payment could be as low as $0. These plans also offer a path to forgiveness after 20 or 25 years of qualifying payments.
Consolidation: Combines multiple federal loans into one, potentially opening up eligibility for different repayment plans.
Refinancing: Involves taking a new private loan to pay off existing federal or private loans. Warning: Refinancing federal loans into a private loan strips you of federal protections like IDR and forgiveness.
Private lenders are not required to offer income-based repayment. However, an attorney can often negotiate a modification or settlement on your behalf, especially if the loan is in default or if the lender fears they may lose a lawsuit due to documentation errors.
When financial hardship strikes, you may need a temporary break from payments. It is vital to understand the difference between forbearance and deferment, as choosing the wrong one can increase your total debt.
Deferment is generally the better option. If you have subsidized federal loans, the government pays the interest while your loans are in deferment. Common reasons for eligibility include:
Returning to school half-time.
Unemployment.
Economic hardship.
Active duty military service (Our firm proudly advocates for military members and service families ).
Forbearance allows you to stop making payments or reduce your monthly payment for up to 12 months. However, unlike deferment, interest continues to accrue on all loan types. This interest is often “capitalized” (added to your principal balance) at the end of the period, meaning you will pay interest on your interest.
Key Takeaway: Use forbearance only as a last resort. If you are facing long-term financial difficulty, an IDR plan is usually a superior choice to avoiding the “interest trap.”
While “forgiveness” usually implies completing a repayment term, loan discharge eliminates the debt immediately due to specific circumstances. This is a complex legal area where having an attorney is invaluable.
If your school misled you or engaged in misconduct related to your loan or the educational services provided, you might be eligible for a discharge. This is common with predatory for-profit colleges.
If you are unable to work due to a total and permanent disability, you can apply to have your federal student loans discharged.
If your school closed while you were enrolled or shortly after you withdrew, you are not responsible for the debt incurred at that institution.
There is a pervasive myth that student loans cannot be discharged in bankruptcy. While difficult, it is not impossible. You must prove “undue hardship” through an adversary proceeding. Recent Department of Justice guidelines have made this process slightly more accessible for federal loans. Our bankruptcy services provide relief for those overwhelmed by debt, offering a path toward financial stability.
You might wonder, “Can’t I handle this myself?” While you can file forms on your own, the student loan system is designed to be confusing. Servicers frequently make mistakes, lose paperwork, or provide incorrect advice.
Hiring Cannon Legal PLLC provides you with a strategic advantage:
If a private lender like National Collegiate Student Loan Trust or Navient sues you, you need a defense. We assist with judgments and lawsuits, guiding clients through defense strategies to minimize financial harm. We check for:
Statute of Limitations: Has the time limit for collecting the debt expired?
Standing: Can the lender actually prove they own the debt?
Documentation: Does the lender have the original promissory note?
Debt buyers often purchase private student loan debt for pennies on the dollar. We can leverage this to negotiate lump-sum settlements that are significantly lower than the total balance owed.
We help protect your Texas and Federal rights making sure you are fairly treated.
Cannon Legal PLLC is a nationwide law firm dedicated to protecting consumers facing financial challenges. Our firm managing attorney, John Helstowski, has been licensed in Texas since 2011 and leads a team committed to leveling the playing field against powerful creditors.
We combine deep legal knowledge with a client-centered approach. Whether you are dealing with student loans, merchant cash advances, or identity theft, our mission is to provide strong legal representation and restore your peace of mind.
We serve clients across Texas, including:
Dallas
Fort Worth
Colleyville
Plano
Denton
We understand that student loans are more than just a bill—they are a barrier to your life goals. We challenge lending practices and provide the critical support you need.
Ignoring student loans will not make them disappear, but taking action can change your financial trajectory. Whether you need clarity on Understanding Your Rights, assistance with repayment negotiations, or a fierce defense against a lawsuit, Cannon Legal PLLC is your trusted ally.
Don’t let lenders dictate your future. If you are in Dallas, Colleyville, or anywhere in the surrounding counties, reach out to us. We will review your case, explain your options for deferment, forbearance, or loan discharge, and fight to protect your financial well-being.
Ready to discuss your options? Call us today at (800) 890-8585 or schedule your appointment online at can.tocall.me. Let us help you move forward with confidence.
As a student loan borrower, you have numerous rights under federal and Texas law. These include the right to accurate information about your loan, the ability to apply for alternative repayment plans for federal loans, options for forbearance and deferment if eligible, and protection against wage garnishment for private student loans in Texas without a court order. You also have the right to dispute errors on your loan and credit reports and to be free from harassment by debt collectors.
If you are being harassed by a student loan debt collector, you have the right to send a cease communication letter demanding they stop contacting you. Keep a record of all communications, and be aware that debt collectors are prohibited from using abusive tactics, making false threats, or contacting you at certain times or places. You can also file complaints with the Consumer Financial Protection Bureau (CFPB) and the Texas Attorney General and consider legal action for violations of the FDCPA and TDCA.
You have the right to dispute errors on your student loan account by sending a written dispute letter to your loan servicer. Similarly, you can dispute inaccuracies on your credit report directly with the credit bureaus (Equifax, Experian, TransUnion). The servicer and credit bureau are then obligated to investigate and correct any verified errors. If the errors are not corrected, we can assist you in filing a complaint with the CFPB.
In Texas, your wages cannot be garnished for private student loan debt without a court order due to state law. However, the federal government can administratively garnish wages for federal student loan debt that is in default, without a court order, after providing notice and an opportunity for a hearing.
If you are served with a lawsuit related to your student loan debt, it is crucial to respond to the lawsuit promptly. Failure to do so can result in a default judgment against you. Contact Cannon Legal PLLC immediately to discuss your case and understand your legal options and defenses.
Answer: Generally, private creditors cannot garnish wages in Texas for consumer debt. However, they can sue you, obtain a judgment, and potentially seize funds from your bank account. It is crucial to defend against these lawsuits before they reach the judgment stage.
Answer: Courts use the “Brunner Test” or a “Totality of Circumstances” test. You must generally prove: (1) you cannot maintain a minimal standard of living if you pay; (2) this situation is likely to persist; and (3) you have made good faith efforts to repay.
Answer: You may qualify if your school misled you about job placement rates, transferability of credits, or the cost of the program. You must file a claim with the Department of Education detailing the school’s misconduct and how it caused you financial harm.
Answer: There is no statute of limitations on federal student loans—they can be collected indefinitely. However, private student loans in Texas generally have a four-year statute of limitations. Once this period passes, the lender cannot legally win a lawsuit to collect the debt.
Answer: Yes. If you are in default, we can help you navigate rehabilitation or consolidation for federal loans to restore good standing. For private loans, we can negotiate with lenders for a settlement or defend you if a lawsuit has been filed.