Student loan default...please help

Discussion in 'Credit Talk' started by panther, Jul 21, 2014.

  1. panther

    panther New Member

    My federal student loans have been in default and in collections for a few years now. I have completely ignored the issue and have never spoken to anyone at the original creditor or any collection agency until today. After reading through this board some, I'm realizing it may have been a mistake to speak to her for my 1st step, but in an attempt to resolve this issue and to get out of default I contacted the collection agency.

    I spoke with a rep for several minutes about what my options were and she informed me of the rehabilitation program where if I pay them for 9 months I will be out of default and sent back to the original lender to continue paying.

    I'm wanting to do whatever I need to do to deal with this issue. I told her I would call her back and also gave her my correct info. I'm skeptical of any of these collection agencies but through some internet searches it seems this "rehabilitation program" is the correct action to take. How should I proceed?

    Sorry if my question is vague, I just don't want to do anything more that I'm not supposed to do but want to get this resolved. I will check back frequently to answer any questions on any info I left out.

    Thanks!
     
  2. jam237

    jam237 Well-Known Member

    Student loans can be complex beasts...

    Are there any extenuating circumstances?

    Did you use up all your deferments/forbearances, etc.? While they are not an option while in default, it can be helpful in knowing as an option for coming out on the other side.

    Who is showing as the current 'owner' of the student loan? (The OC, DoEd, etc.)

    Is the CA & OC or current owner, reporting the debt 100% complete, accurate, and verifiably?

    A key thing to notice, if you multiply the number of payments times the payment amount, does the total equal approximately the debt? (i.e. If you're in default, and they are still reporting 36 payments, but the payment amount that they are reporting is the full amount, TECHNICALLY, they are reporting that your student loan debt is 36 TIMES what your student loan debt, actually is.)

    If the DoEd is reporting, you can't get civil damages from them for reporting incorrectly (after you've disputed it), but it can provide some additional leverage in trying to resolve the situtation, if you are willing to go the extra mile of a long battle. (Hint: Mine was 14 months, thanks to a delay while waiting for a case to be ruled on at the U.S. Supreme Court. :))
     

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