Hi all! I hope you are all doing well. I am here looking for some advice on rehabbing my student loan. I am SO lost on where to start. There are several collection agencies mailing me demands for payment, and several reporting on my CR. I have contacted American Education Services in an effort to discern who it is I should be paying. Two CAs I know are trying to collect are NCO and Diversified Collection Services. I hope to hear from AES soon. Here are a few questions that I have... 1) Do they take your income into account when drafting a repayment plan? My DH is currently laid off, and our only income is his Unemployment Compensation. I cannot currently work because of a difficult pregnancy. 2) If I do enter a rehab plan, will they still take my tax refund? We are due some $$ this year, and really need it to live right now. 3) In addition to my loan amounts, each CA is asking for HUGE fees. Is there any way to negotiate these amounts? Any and all advice about rehabbing the loan is greatly appreciated. Thank you SO much!~ Maureen
Do not attempt to rehab until you are sure you can make 12 consecutive payments. If you screw up you will never be able to rehab again and that means 7 years of pain. And I don't think they set up payments according to income. If I remember correctly, I had to pay 2% of each outstanding loan for 12 months. My advice, make a payment here and there to keep it out of default, or to appease the CA until you can afford to rehab.
They do have income sensitive repayment plans (however, I'm not sure if you can use these to rehab). The CAs who will start calling you will try and push you to consolidate, they get more money this way. However, I wouldn't do it unless you absolutely need to get the loan(s) out of default. Go with rehab if you can (it is better for your credit, if the loan(s) are in default). Contact the Student Loan Ombudsmen if you need help or you aren't getting anywhere (you can find the contact info at the Dept. of Ed web site). If you are in default, they can take your tax return, without a judgment. However, unless you've been in default for quite a while, I doubt that will happen (but ya never know...). Keep after these and don't let them go. They never go away and the quicker you get these taken care of the better off you'll be. Good Luck!!
