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Are there special exceptions with the laws for student loan collections?  

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Are there special exceptions with the harassment laws for collection agencies trying to collect on student loans? I am getting harassed at work by an agency who is representing my school loan debt....I want to pay but, they are not working with what I can afford to pay.

Mandy
 

asked Nov 2, 2004 08:34 AM

Anonymous
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Quote:

Originally Posted by Mandy
Are there special exceptions with the harassment laws for collection agencies trying to collect on student loans? I am getting harassed at work by an agency who is representing my school loan debt....I want to pay but, they are not working with what I can afford to pay.

Mandy


No, the laws regarding harassment from creditors applies for student loans as well. They are not allowed to harass you for student loans. All you have to do is write them a letter to tell them that they should only contact you through mail. Tell them that your employer disapproves of creditors calling your job. They are not allowed to call your job if your employer disapproves of this.

When you said that you want to pay, does that mean that you are actually still keeping up to date with your payments. Even though you cant afford it now, you should try your best to keep up to date with your payments while you try to work something out with this collection agency. Because missing payments will ruin your credit and get you in even more trouble. So it is most important to protect your credit while you are trying to work something out with this collection agency.

I also have heard of cases where students are able to consolidate loans that have been defaulted. As long as there are no judgments against you and you have not consolidated in the past. This will allow you to reduce your monthly payments so your payments could be more manageable. Contact the education department where you received your student loan I hear that they are very helpful with people who are genuinely interested in resolving their debt. They may be able to direct you to your next course of action.

answered Jun 1, 2005 04:13 PM

16 Answers

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Hi Mandy,

Yes the same fair collection laws are applicable for student debts as well.
However there are options for you, during this hardship to handle your debts in a smoother way. If you can't make payments on one or more of your student loans, don't panic. It's important that you learn about your options rather than give up and slide into default.

In case of economic hardship you can defer payments on federal loans obtained after June 30, 1993 for up to three years if you are suffering an economic hardship. You are automatically entitled to this deferment if you receive public assistance, such as welfare or SSI. If you don't receive public benefits, qualifying is based on a complex formula that's a mix of your income, the federal minimum wage, the federal poverty level and your monthly or annual federal student loan payments. You will have to provide documentation of your income, such as pay stubs.

Other possible options include:

* postponing payments through deferment or forbearance programs
* eliminating the loan altogether through loan cancellation, or
* discharging the loans in bankruptcy.

answered Nov 3, 2004 02:45 AM

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If they are federal student loans they won't be able to discharge them in bankruptcy, they will remain on the credit report 7 years following payment in full of the account.

Was going to say that you can send the collection agency department a partial cease and desist letter telling them that you are not allowed to accept phone calls at work and to just contact you by mail.

Make sure to keep copy of the letter you send them, and send it certified return receipt requested.

answered Apr 26, 2005 03:30 PM

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I cosigned a student loan for my son about 7 years ago. It has been unclear as to how he has handled this, but I have since filed bancruptcy. The trustee and I tried to locate the debtor many times and was told there was no record of it. My bancrupcy was discharged several months ago. Now, I am being written letters threatening lawsuits and garnishments. My son says he has talked with them about this matter and agrees to pay. how should I handle this matter.

answered Sep 16, 2005 11:41 AM

Anonymous
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Hi sandra,

Welcome to forums. Perhaps some collection agency is sending the letters; am I right? Since your son agrees to pay the loan amount they should not contact you. You can refer the contact details of your son to the agency and your son should handle the issue in future.

Make sure that your son pays the installments timely; otherwise you would be responsible for non-payment. Also remember that federal student loans do not have any statute of limitation, you have to pay it anyway.

Regards,
Bryan

answered Sep 16, 2005 12:26 PM

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Is the collection agency allowed to call all my family members and tell them I put them down as a reference for a loan? I don't know how they got their numbers.

answered Mar 7, 2006 06:36 PM

Anonymous
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Juanita,

Third party debt collectors should maintain the collection norms set by FTC. The rules made for debt collectors are stated under fdcpa. It says that collectors can call your relatives or references if you are not available at your address or they cannot locate you for somehow.

They can call your employer only to verify your employment. They cannot disclose your financial obligations to others. If they do, you can file complaint against them with FTC, BBB and Attorney General's office of your state.

However they can contact your co-signer if the debt is default. Juanita, are they calling you for student loan? If you find them violating FDCPA laws, you can also report against them with DOE. Keep us posted.

answered Mar 8, 2006 12:44 PM

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My wife has cosigned for a Sallie Mae loan with her son. It appears he may default and she is not able to pay due to her own obligations. She and I have co-signed together for our mortgage about four years ago. The Sallie Mas loan is about two years old. Can Sallie Mae come after our home to collect this loan even though I, the husband did not co-sign on that loan?

answered Dec 20, 2008 10:00 PM

Anonymous
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Your wife as the cosignor has the same obligations as the borrowers. This loan IS her obligation. Sallie Mae and the collection agencies with pursue both your wife and her son . Sallie Mae will sue which could lead to a lien against your home plus they could actively pursue wage garnishment.

answered Dec 21, 2008 06:38 AM

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I had a school loan from when I was taking classes online then my schooling was disrupted by hurricane katrina and I had to relocate. I have a family and I am doing everything I can to make ends meet and I am not doing very well at it. I still owe 4000 on the school losn but just can not afford to keep up the payments at this time. What can I do?

answered Feb 18, 2009 09:53 AM

Anonymous
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