I would greatly appreciate any suggestions on how to go about writing a letter to the guaranty agency that currently holds my loan to let them know I received their letter and I need some time figure out the best way to proceed. I received a letter from them last Friday stating that this would be their final notice before possibly sending it to collections, filing a civil suit, or referring the debt to the government. I will know better where I stand this coming Wed. Should I wait until I know more after next Wed, or is it better to write the letter now. I know I don't want to talk to them over the phone as I do not want to be bullied into making a decision. Any thoughts on this would be great! Thank you.
Have you ever looked into seeing if you qualify for IBR (Income-Based Repayment) on this student loan? If it's a Federal loan and you don't have enough income to make the payments, you should definitely look into this. In the meantime, write the letter, explain your financial situation, and inquire about applying for IBR through your lender. If you exhibit that you're trying to work with them instead of avoid them, they will be less likely to resort to litigation, which is generally a last resort.
Yes, I have been researching IBR. Unfortunately I am in default and you can not be in default when you apply for IBR. I have also researched rehabing a loan which on the surface sounds great, but when you do the research you find out that once you go through the nine months of rehab if your loan is not bought you remain in rehab. I have not been able to find anything about applying for IBR if you are stuck in rehab. The only thing I have found is that you have to apply through you lender. Does anyone know if I have to wait until someone purchase my loan to apply or if the last lender is who I would apply through? I so appreciate your help and time.
Yes, that's right. I had forgotten that you have to get yourself in repayment before you can qualify for IBR. But as long as you are in repayment, you should be able to apply for IBR either through the current lender or a new one if the loan is sold. You can read more about it in this FAQ: IBRinfo.org.
Sherriann, you can consolidate your federal student loans using federal direct loan consolidation(as long as the defaulted loan is not a direct consolidated loan), which will take you out of default or make the 9-12 months of on-time consecutive payments. If you do not cure the defaulted federal student loan, you will not be able to receive any type of financial aid until the default is cured. Loan consolidation does not take a long time and you can apply for the Income Sensitive Repayment Plan when you apply(actually, you are required to do so if you are consolidating a defaulted loan) Also, the interest rate is very low right now.
