You all have been helpful, thanks! Now, I have a new/continueing situation. My CA won't respond in writting to anything. They want to talk on the phone, but they keep sayng different things. On your advice I called both the DEpt of ED (they hold my loan) and the ombudsmans office. The ombudsmans office said I had to deal with the Dept of Ed in writting before they could help me . Fair enough I think. I called the Dept of Ed. I got some airhead representative. I had to explain what a settlement offer was, she wasn't clear how long a rehab would take. she said if the CA only wanted to talk on the phone, there was nothng the Dept of Ed could do about it. .She didn't know what an ombudsman was. She kept referring to the money owed as the CA's money. UGh. (I guess I'm venting.) The next week I got to go bury my Grandfather, and pick a nursing home for my grandmother.fun stuff. When I was gone the CA kept calling my house mate and yelling at her (????) Now, the question is, do I have a legal right to tell the CA to contact me only in writtng?I want some written words before I agree to anything. Also My student loans aren't beign reported to the credit Agencies. If I settle,do you think they'll be reported? Has anyone been able to deal with the Dept of ED instead of the CA? Thanks! I've just written the DEpt of ED, stating my problems, but I can't imagine that they'll get right back to me.
So, your guarantor/servicer is the Dept. of Education. Are these federally subsidized Stafford or Perkin's loans? Is the holder of these loans the William D. Ford Foundation/Direct Loans? Is the lady that you spoke with at the DOE your specific account manager for these loans or a front line rep? If she is not your specific account manager, you need to speak with the person who is handling your account at your servicer. Also, if you want to rehabilitate the loan, you first need to make sure it is eligible before you go through this process. Call 1-800-4fedaid to make sure that it can be rehabilitated. I can't believe that this woman whom you spoke with at the DOE could handle your account, as it is ludicrous for a servicer rep in federal student loan collections not to know "how long" a rehabilitation is and tell you that the money owed is the "CA's money". That isn't true. All federal student loan money ultimately belongs to the DOE - including that handled by other servicers. That's why they are called "holders" not "owners". The collection agencies NEVER own the loans, they just get a fee (18.5%) for collecting on the account. That's pretty ignorant of her not to know that. I would call the DOE (i.e. the servicer of your loans) and find out which person is handling my defaulted account at the servicer (this is the person who is in contact with the collection agency and this is the person who notes all of the payments received on the account). If it happens to be this uninformed woman you spoke with, demand to speak with her supervisor and tell him/her that you want the account rehabilitated. Also, ask this supervisor for the name and phone number of the supervisor who is handling your account at the collection agency. I would then tell your account manager to notate your account for rehabilitation. You also need a letter from the servicer stating the priniciple, interest, and collection costs owed on the account. As the Ombudsman's office recommended, write the servicer all of the above - stating that you want to rehab the loan, requesting a rehab agreement letter from them and the collection agency, and requesting an itemozed breakdown of what's owed on the loan. The Ombudsman's office is looking for evidence that you are trying to fix this, so it is entirely appropriate to start a paper trail. In the meantime, get you a specialist at the Ombudsman's office to work with and make friends with him/her and communicate with him or her all letters you send/receive to the CA and the servicer. I would call the collection agency and tell them that I will rehab the account and that I need a written rehab agreement from them detailing the montly payment due (they have to send it). If this rep is unreasonable - get the supervisor and tell them. If the supervisor is unreasonable, call the servicer back and talk to that supervisor and tell them that the CA is uncooperative. Write them as well detailing any lack of cooperation and cc your specialist at the Ombudsman's office. Concerning harassing calls from the CA, once you get set up on a payment plan, they will leave you alone. You're privileged not to have the loans reported yet. That's great. First, there is no such thing as a "settlement" for federal student loans. You must pay in full - including all interest and collection costs. This is the government's money - not some private compan'y money - and the government is not about to "write-off" a bad debt to itself. Having said that, if you can pay in full now - then there is a good chance the entries won't make it on your credit report (but I don't guarantee it). Also, obviously, paying in full will bring you out of default. If you can't pay in full, then you need to call the collection agency to send you a rehabilitation agreement letter. The loans may or may not make it on the report, but if they do it's a moot point since they will come of in 12 months anyway. Again, once you set up a payment plan, then the CA will leave you alone. Please take my advice on your own recognizance, but I think it is largely sound. You can do a search here for "pamela moran" who works for the DOE re rehabilitation and may be able to help you more. I listed her e-mail address on this site.
