Your balance is $320. In Jan I sent in $10. Now their saying my balance is over $600 because they taxed on late fees. Can they deduct from my taxes? Can they garnish my wages? Would they have to bring a judgement against me to garnish? What should I do? I was going to pay them when I got my taxes back, but now they want $600. What should I do?? Thanks Me
Yes they can seize your tax refund, but they have to notify you in advance (you have to be in default I believe). Yes, they can garnish your wages and no, they do not have to obtain a judgment to do it. All it takes is a letter to your HR department to begin garnishment. Totally legal - Congress gave the Dept of Education more power to collect on defaulted student loans (basically their power is equal to the IRS's power to collect back taxes). Filing bankruptcy will not even get rid of your student loans.
Ok thanks for the info. This post is about my friend not me. She talked to a cs rep in jan and told her to take the $300 from her taxes, because she planned to pay it off then anyway, but they didn't. Now it's $600. If they do garnish wages? willthey take the whole $600 or a certain percentage at a time? Thanks...
if they take taxes- they will take the whole $600. If they garnish wages, not completely sure on this, but I think they cannot take more than 15% of gross. It takes along time to garnish wages though- its best if she just gets in touch with them and makes payment arrangements.
She did get in touch with them in Jan, she tried to default the loan and they said no. So she said she'd pay the $300 when she got her tax return. Now they said her balance is $600. They didn't take it out of her taxes like they threatened to either. ( they threaten after she said she would pay them with the taxes anyway) Is there anyway to get them to settle for the whole balance of $300?? Or should she say F-them and let them garnish her wages. I just want to add, my friend is a single mom who only has extra money at tax time. The rest of the year she scraps by ( brorrowing from me, LOL ) Me
If they garnish wages, they take 15% of gross pay. And it doesnt take long at all - two weeks and they are getting their money out of your check. The extra $300 is probably collection fees and no they usually wont settle. They dont have to settle because they have some pretty good ways to collect on the debt (taxes and garnishments). Best thing to do is to call them and work something out.