Hi all, I just joined creditnet. I've been reading here for a couple of weeks and can't believe how much information is available. Anyway, I have pulled all 3 of my credit reports and figure the first thing I would tackle was fairly obvious and easy - get into a rehab program with my student loans that were previously in default. I contacted the Dept of Education info line and found the name of the guarantor. Contacted the guarantor who told me they had been placed with a collection agency and that I had to deal directly with the CA. Called the CA and requested to be in the rehab program and received my package on 9/18 with written acceptance, payment amounts, etc. I sent in my first payment which was cashed on Friday. Here's my question (finally) - Saturday I received a letter in the mail from the CA with a threat to garnish my wages for non-payment of a defaulted student loan. It said they'd tried without success to contact me, and if I didn't pay in full within 10 days, my wages would be garnished. I'm not sure whether to be confused or mad at this point... LOL. Any ideas what I should do about this? Just contact the CA by phone and see if maybe it's just a mistake (I know this seems kind of obvious, but they are a CA so I don't want to mess anything up)? Contact the guarantor directly and let them know how incompetent this CA is? Contact the DOE ombudsman? Thanks in advance for any advice and thank you all for being there to help. CB
it probably is just a mistake, but I would follow up with a phone call first thing this morning and then confirm everything in writing and send it to ca. better safe than sorry!
Cornbread: Did the collection agency charge you collection fees in addition to what you owed? If so, did they roll it into the rehab loan amount? And, if you were charged collection fees, how much were they (as a percentage of the total amount you defaulted on). Were these government loans? What kind? From the time you first contacted the CA, how long did it take to get the paperwork? Sorry for all the questions, but am helping my son with the same problem, and he is about to get started on it.
Okay I called the CA and it was indeed a mistake. They apologized and are sending in writing that it was a mistake, so all is well. Karen - my collection fees were 19% of the principal and interest. I double-checked this with the original guarantor and they said this was correct. It was rolled into total amount due. I got my rehab packet 2 days after I talked with the CA. My loans were stafford loans. Since you are just getting started, do you already know who is the guarantor for your son's loans? If not, you can call the DOE loan locator line at 1-800-433-3243 and find out very easily. You can read about the rehab program at http://www.ed.gov/offices/OSFAP/DCS/rehabilitation.html and http://www.carreonandassociates.com/sl2.htm. If you run into problems with the CA or the guarantor, the DOE has an ombudsman who can help. Their phone number is 1-877-557-2575. If the loans are defaulted and have been placed with a CA, they *have* to let you rehab. They are still a CA, though, so expect them to ask you if you will pay in full or try to convince you to consolidate or something. I specifically requested loan rehabilitation when I called. Mine at first said they needed a 10% downpayment to let me into rehab (not true), and I just said I didn't have that (true). They asked me how much I'd be willing to pay and I said $100 per month and they hemmed and hawed and said that might not be enough, and I said well that was all I could do. Then they do that "well let me check with the originator and we'll see if they will accept that", but that is all a song and dance. So know before you call what you can do, and be polite, but firm in sticking to that. (Note, this is just my experience and your mileage may vary). Okay sorry so long winded, but I hope that helped.
Very good information Thanks. I hate dealing with CA's, and feel a need to be prepared ahead of time.
