Student loan Wage Garnishment - How can I remove them?

I have been getting my checks garnished because of a defaulted student loan. I went the process sending Dept of Ed (direct loans actually) for this to be added to my current student loans. I got a summary statement letter saying it would be consolidated in 10 days. Can my check continue to be garnished from this collection agency even though the dept of ed approved my consolidation? Do I have to wait until this 10 day period ends?

Within a timely manner. This has been going on for almost 5 months, garnishment. A guy from the collection agency told me when i get this summary statement, fax and then they would stop garnisment by calling my employer.

Quote:

No garnishment can be stopped by a phone call. Plus student loans loans already in garnishment are automatically denied consolidation.

How did you get your loans consolidated if your wages are already being garnished? I was told by federal idrect loans, once your wages are being garnished, you can't consolidate them until the garnishment is lifted.

He hasnt qualified....initial paperwork done, but he will be rejected.

BODY { MARGIN: 8px } .LW-yrriRe { FONT: x-small arial } I am in default of a student loan. Through job layoffs and attrition, I simply could not pay it, so it naturally defaulted. OK, I get a called from FMS and got letters as well telling me about a loan consolidation plan that would get the student loan out of default. The agreement was that I make 9 consecutive payments. I had it set up where it was automatically being debited from my account....$150 a month. I made 7 consecutive payments.....7 MONTHS. I was furlowed (a nice way of saying laid off) and soon after, my bank account was in the negative and ALL of the online bill pay accounts I had were bouncing because I simply could not pay the bills. My bank account was closed....CLOSED because there was no longer a direct deposit going to that account and I had no way of paying the now $900 that my account was showing delinquent. Show Sun Trust naturally closed the account. I called FMS and let them know my situation. I was at 7 payments. I was out of work for a couple of months. I finally get back to work and within 2 months, I get a call from my employer saying my wages were going to start being garnished by FMS at 15%. That is absolutely killing me. What is more frustrating than anything else was I was never offered a chance to start over with the loan consolidation plan...seeing as I had honored our agreement all the way up to me being laid off. So now my wages are being garnished and have been garnished for 8 months now....for far more than the agreement I originally set with them. What can I do?

You were doing loan rehab, not consolidation.

Did you go back to the same employer or a new one? Did you not receive the 30 day notice of garnishment, giving you the right to appeal?

How much do you owe?

I honored a payment plan for 8 months, missed one month and immdeiately my check was getting garnished on a weekly basis by 15%. I've called HESC several times to try to get that percentage lowered from 15% to 10%. Since once garnishment has started its extremely difficult to get them out. Im not trying to get over on anything, but there's has to be something I can do about this. HESC extremely rude and not willing to help. My check has been getting garnished from 11/09-current, avg. about 105.00 a week. Between loan, interest and collection cost my payments havent even made a dent. What can i do? PLEASE HELP! If not by finding a way to stop garnishment ushering me to some sort of program or lowering the weekly percentage fro 15-10 percent. In today's world, every little bit counts I'm trying to do the right thing but it is extremely difficult when people are unwilling to either offer information or assistance.

I have a suspision you were set up on rehab in lieu of garnishment....garnishment never starts immediately unless the 30 day garnishment notice had already gone out.

By my calculations, you net $2800 per month, well above any hardship guideline. The only way you will get out of garnishment now is to attempt rehab again, making your 9 payments over and above the garnishment.

I have a similiar situation. My wages are being garnished & I have found that I can do NOTHING about it. Due to divorce, job loss, medical, etc. etc. I have fallen behind or stopped making students loan payments several times over the last several years & I have always been able to work out something. I refinanced my home a couple of years ago & it was a mortgage scam. Long story short, I fought for awhile & could not pay student loans. They did not send me any notice at all about garnishment, just late payment notices......I was in a forebearance agreement trying to keep my home of 14 years & bam......got a check that was garnished & could not pay my agreed house payment so I lost my home in Jan. I tried to show hardship but they DO NOT care even if you are homeless (which I was for a few weeks), also my son meanwhile had to have surgery & therapy, etc. If I didn't qualify for hardship, I don't know who would. Now, I am having my wages garnished & can't seem to do a thing about it. I was told right before that I could make $127 a month but they now take about $575.00 a month from my wages. I wish I had a better answer for you but I can tell you that SOAPLADY knows her stuff & alot of other info on here is WRONG! She must work for an agency because she is the only one that has the facts. Trust me, I have been trying to save myself from garnishment but not happening. Eventually this will be paid & maybe I can look for a house again in a few years, until then I'm at their mercy & once they get your $$$, they will NOT talk to you. Good luck & if you find something that works, lemme know.

I have a past student loan debt. I graduated from college in 2006 & I believe my loan went into default in 2008 due to non-payment. My question is. what can I do to prevent granishment (cause I "finally" have an interview set up next week) before it begins? I'm almost positive that this interview will end on a good note & I want to try & prevent granishment if I can.

Is it a federal or private loan.

Ok first I wanted to know two things. One if I never contacted the CA back would they have ever found me. The same with giving the CA my employer. If they didn't have that could they start the garnishment process.

Next, I have requested the hearing within the 30 day notice from the CA. How do I prove that I'm paying expenses for my mother who now lives with me after being evicted from her home last year. So I pay for her basic living expenses. Because they are saying they can't go below 1% of the total balance. I want to start rehab payments for the 9 months. But it is too much for me by $200 and they just will not budge. I also have filed for some of the loans being signed by someone else. It is just taking me time to prove my signatures to find signatures from 12-14 years ago.

And if they do garnish that is not part of the rehab program right? I would have to make payments on top of the garnishment correct.

So besides though questions my main one is how to get them down on the monthly payments and all that nonsense about 1%.

Thanks,
Goldy

Loan repurchased by PHEAA. Employer sent me a copy of the garnishment letter. I never received the 30-day letter to appeal the process first. Yes I moved, but the garnishment letter shows the CA received my correct (new) address. CA also verified my e-mail address and phone number prior during a phase where I was disputing the default status as I had applied for a deferrment...

How do you file an appeal based on the fact that you never received the 30-day letter and that the CA had the proper contact info?



I think the whole intent here is to make as minimal communication as possible so they can charge the 18.5% collection costs.

PHEAA paid your default claim. Garnishment notices are usually "address correction requested" which means the post office sends your mail back with your new address. It is your responsiblity to keep your lender/guarantor informed of your current address....they will not resend the garnishment notice. You can appeal but your request will not be processed timely....meaning those appealing within the 30 day period go before you.

You may have applied for deferment but it was not granted in time or at all. It takes 270 days to default....deferment takes a couple of weeks. They probably ditched your dispute.

The 18.5% is charged at 60 days post default. As a general rule, they dont start garnishment until a minimum of 180 days post default.

Anyone else at this point?-Income breakdown 52% for mortgage, 22% taxes, 15 % for garnishment.... Dealing with the ca is like dealing with a small minded communist country. Their story- that they sent a notice for garnishment 30 days prior to action....Asked how they sent notice- they replied "by mail because you don't answer your phone"...interesting when the mail service stopped delivery 2 months prior to my address...and I have no phone. How can these people blatantly lie like this? The fact of the matter is I too, like prior persons on this chat board routinely tell people "NEVER take out a school loans".
Here's the kicker...13k for the original loan amount- which is now at 36k.
This is painful, when a colleague has "0" loans because of her "citizenship status" allowed for a full ride...on my back. Now lets see if there is any hope for some light on this matter...considering over 62% of student loans are currently in default. Has anyone else written their congressmen/rep?

Phone issue....whatever phone they had on file was not answering. Did you give them a new contact phone number? Mail was sent to your last address on file. It is the borrowers responsiblity to notify the lender of their current contact info including address and phone.

What has your collegue's loan got to do with yours? Citizenship status doesnt give her a full ride unless she earned it.

You had the opportunity to consolidate your loans under the income contingent repayment like everyone else prior to the garnishment. It is not the governments responsiblity you are paying a mortgage payment you cannot afford but you did have options....

I'm sure this question has been posed many, many times, but I'll ask again because I am new to the forum. I have been very poor with my money management and have avoided mostly paying for my student loan. Of course, it is in default and the CA has been tracking me down for years. At times they have "caught" me and have made some payments, only to run into some problems with other debts, causing me to stop making payments. Stupid on my part, yes. Now they have contacted me threatening wage garnishment. I make very little money compared to the cost of living where I live. I plan on talking to them this week, but I want to be armed with information.

Is it possible due to financial hardship to get the loan (it is a federal loan) wiped out with bankruptcy? I know you have to prove hardship, and after paying rent, phone, utilities, food there is very little left to pay of the loan. I'm desperate and this whole deal has had me contemplating suicide. Should I contact a bankruptcy lawyer after talking to the CA and seeing what plan they have to offer? They are threatening garnishment, but I don't know exactly how much of my net (or gross) they would take in 2010. Any help or advice would be appreciated. Thanks, and good luck to all those who are in the same boat as me.

Not gonna work.

If you had read the forum, you would know that garnishment is 15% for federal loans. You would have read that you can consolidate, get out of default and get an Income Contingent Repayment based on your income. Read the stickies at the top of the forum...they contain valuable information.

I was really stupid and cosigned on a student loan for a friend. He is currently making payment but they are getting behind. Of course he won't answer my phone calls or emails. I am curious to know if I will receive the same garnishment treatment and have my income tax refunds withheld if he defaults on the loan or if there is any protection for me because I was the cosigner and received no benefit from the loan?

Please help.

You will both be sued first and then garnishment can occur. You are just as liable for the funds as he is....there is no protection.

I don't know if you will be able to answer this but If I as the cosigner take over making payments on the student loan and there is a cosigner release clause, can I be released from the loan if I meet the 24 month on time payment condition and the promamry borrower credit report is in ok shape?

Can I sue to primary borrower for the monies I had to pay on their behalf?

If there is a cosignor release, it has to be the 1st 24 payments coming out of school....miss any or be late, it becomes null and void. There is no grace.

You cosigned of your own free will...you took on the responsiblty without conditions. On what grounds would you sue??

Collection agency has been taking 15% of my net pay for the last 9 months for my "student rehabilitation loan". They said after 9 months it will no longer show in default of my student loan on my credit report and I will go back to making regular payments on my account. My 9 months payment was JUly 25th. I have no heard anything from them. I want to know what's happening and what my payments are going to be. I am hoping they are not going to continue to take the $486 a month from me and I can make a less gouging payment. Anyone have any experience with this loan rehab program?

Sorry, but a garnishment is not a rehab payment.(you are being garnished, correct?) Rehab payments by law have to be voluntary which means you have to pay them yourself, not have them involuntarily taken from your paycheck. Your garnishment will remain. The only way to get out of the garnishment will be to make 9 payments over and above the garnishment.

A couple questions...

Can you negotiate a rehab payment? Or is the payment base on a formula and there is no way to negotiate the payment down?

When doing a rehab payment, do you need to get something in writing? Or, it just standard procedure and everything goes as planned when you are finished after 9 months...

Thanks in advance for the help... This is a great forum and I'm sure it has helped a lot of people...

If you have a private loan,which reading back I think you do, rehab is not a possiblity. Only federal loans have the rehab option.

It's a Federal Student Loan (29,800) that defaulted. The CA is quoting me (for a rehab program) a payment of $280 for 9 months.

Can I negotiate this payment? Or, am I stuck with $280?

Also, I'm a business owner (same as self employed - correct?), as of now, they would offset my tax return if I did not go into the rehab program. This really doesn't effect me because I can make my tax return be very little.

So, what else could they do besides going after my tax return - should I not elect to do the rehab program?

$280 would be the standard 1% payment. You can get "reasonable and affordable" payments but you will have to prove that the $280 is a hardship. Since you are self employed, that would mean submitting bank statements, tax returns, financial statements and anything else they ask for.

I can certainly understand the way Anonymous feels. It is a Trap! A trap of debt for life and if it is beyond your control to pay it back, then the death scenario can seem like your only way out. Overwhelming debt with no hope of relief in life can cause despair, desperation, anger, and depression. To top that off the feedback you get concerning your debt situation of apathy and no excuses simply adds to your hopelessness. Bankruptcy is not even an option because you have to be dead or permanently disabled to discharge student loans. How absurd! Again, from this criteria, the creditors are telling you...you are worth more DEAD than ALIVE and DEATH is a way out! There are worse things than death, where at least you are at rest....living a life of desperation, depression, hopelessness, oppression, and discrimination is WORSE than DEATH! Death is a way out of a SHIT LIFE and the LAW has made it so! Screw the student loan system and it's laws!

The law has also made it much easier for students to pay back their federal loans thru the Direct Loan Consolidation program, ICR/IBR repayment and loan cancellation/loan forgiveness. It is those over borrowed, using private loans to attend schools that they couldnt not afford that are now in trouble.

We live in a society of "want it all now." When I went to college, I worked, saved and planned for college. Got scholarships. I did come out with loans but they were paid back within 4 years thru hard work and determination. The borrowers of recent years go to schools they cannot afford, out of state, private and study majors that wont lead to a job.

More shit student loan repayment options. Here is the Department of Educations sword and ace in the hole against discharge of student loans. The ICRP as it is known...the Income Contingency Repayment Plan is a 25 year prison sentence with the REAL PUNISHMENT to come AFTER the 25 years is up. You make your minimum monthly payments during your 25 year repayment plan (ICRP). If you are unable to make sizable payment to cover the full amount of interest/penalties, etc... the loan interest will continue to accrue/capitalzie year to year. It never stops growing, if you cannot make sizable payments. Your payments will be scrutinized year to year and updated as your wages increase (if they increase). At the end of the 25 year period...depending on how old you are...you may be on social security at that point....they say the balance of the loan is discharged/forgiven. What they don't tell you is....the dischaged amount after the 25 years is up is TAXABLE. You will then owe the IRS a huge sum of money in your elder years as the amount continues to grow. Thereby giving you a whole NEW SET of problem, as you are unable to pay off the IRS debt with your social security payments! They will be coming after you then exchanging the student loan collection activities with IRS collection activities. How SWEET! Oh yeah, one more thing...if you are unable to pay your student loan back into your elder years, they will be able to confiscate 15% of your social security payment. Again, how sweet! They won't allow you to dischage the shit in bankruptcy negating the "FRESH START" you are supposed to receive from a Chapter 7 and from bankruptcy code 523 (a)8 and they oppress you for life to pay back a loan that will cause a low income person...undue hardship. I have read case after case of undue hardship legal proceedings where the judge denies discharge on self-evident hardship cases of low income debtors in bad predicaments and the LAW simply does not care when it comes to student loans. The LAW MUST BE CHANGED concerning student loans and classify them as any other form of unsecured debt, so they can be released in Bankruptcy court for poor debtors. There is NO FRESH START for student loans. It is simply a LIFELONG OPPRESSION of debt! How PATHETIC! The student loan collection people have a saying...You can't squeeze juice from a turnip, but we will try to crush the turnip! WRITE YOUR CONGRESSMEN AND THE PRESIDENT to have them CHANGE THESE ABSURD STUDENT LOAN POLICYS TODAY!

Higher Education is not a god given right in this country. You borrow, you pay back. Why should there be a fresh start? You choose to go to a school you cannot afford , why should the taxpayer foot the bill??? Explain that one! Student loans used to be dischargable in bankruptcy but they system was abused.

Parents need to take more responsiblity in educating their children in borrowing money....as a former financial aid officer, I saw students arriving with no clue on how to pay for school. No parental advise, no parental assistance. These often were students that would have been better served by attending a community college that was affordable...but no...they wanted the university "experience".

Soaplady - you are extremley knowledgeable and I appreciate the time you put in on this forum. I have only one question for you after reading all the other discussions.

You said earlier "The only way to get out of the garnishment will be to make 9 payments over and above the garnishment."
Does this mean:

1) They take the $400 a month garnishment and I pay and extra $50? Is that considered over and above?

2) They take the $400 a month garnishment and I pay for example an extra $450?

Thanks again for all your advice.

Your payment over and above the garnishment is based on what you owe...a standard rehab payment is 1% of your balance. So, if you owe $8000, the payment would be $80, $32,000, $320.

Hello all. I am in the same situation as most. I went to college for what was suppose to be four years turned into five and $45000 in student loans. I'm still struggling to get a job that I'm comfortable with in my field and the creditors won't keep calling. I'm scared out of my mind because now they say that they are going to garnish my wages. I have made attempts to pay but because it's not the amount "they" stated, they said they couldn't accept it. I've been out of school barely 3 years and working my butt of to live not even comfortably but enough to make it day to day and now "they" say their going to take my income. What else can I do but cry?

What type of loans do you have? Federal or private?

I am experiencing an AWG the collection agency intentionally sent it to the wrong address they had my correct address on file yet they sent the notice to the wrong address so I could not reply within the 30 days and stop the AWG and rehab the loan. Is there anything ic an do

Sorry but I really doubt is was done intentionally...collectors do not commission on garnishment accounts. If they had your correct address at some point, why did you not get into the rehab program??

Sorry SoapLady but back in the day going to college was absolutely affordable. Nowadays, working a whole summer making minimum wage will barely cover your textbooks for the semester nevermind the tuition. The educational establishment has been hijacked by greedy lenders which has driven costs through the stratosphere. We are entering true crisis mode and something is going to have to give. We will have 1 trillion dollars in outstanding student loan debt in just about 2 years time. Bankruptcy reform is coming whether you like it or not. No way this madness can continue much longer.

i just received a letter from my employer that my wages are been garnish from defaulted student loan... my question is if i offer to pay half of my 16,000.00 dollar loan will they lift the garnishment and let my pay the rest via checking account?

You had the opportunity to appeal the garnishment prior to it starting. Only thing you can do now is rehab the account and you will be able to get it out of default in 9-10 months.

i flile my taxes joinly with my husband will they take my tax return too if I rehab the account?

If your loan is in default, they can seize your taxes. Depending on the guarantor, if you get into repayment, they will not seize your return. Each guarantor has a different guideline so talk to the CA handling the account.

I recently got behind on my student loan payments due to being laid off from my job previous job. After being set back on payments I recently tried to make a $1200 payment and was told it had been sold to a CA. I contacted the CA and they gave these options: pay the $30,000 balance in full, pay $18,000 of the balance with a $180 monthly payment every month, pay $12,000 with a $250 monthly payment, or pay $6,000 with a 350 monthly payment. I stated to the CA that I could not even come close to any of those options. I stated to her that I could put 2,000 down and make monthly payments of $200. She said that I would have to try and talk to my co-signer or somehow come up with the money to meet one of those payments plans because those were my only options. I told her that it was IMPOSSIBLE to match any option she gave me and I once again said $2,000 down and $200 was what I could afford.

Any ideas on what I could do from here?

I do not want wage garnishment and am looking for any options at this point in time.

I have rehabbed my loans once before.

Thanks

Is this a private or federal loan? It is a little confusing...federal loans dont have cosignors, only private loans. And you cant rehab a private loan....

Yes, the loan is a private loan. I had just assumed it was in rehab because a few years back I was put on a payment program that reduced my payments for about a year and it all went to interest only on the loan. The name of the plan was entitled "rehab3" when I would go online to the website to make a payment.

It might have been some internal type of rehab program but it also sounds like you were not in default when this happene....this is nothing like the federal rehab program.

Also, nobody would have told you that your loan was "sold" to a CA.....student loans both private and federal are only assigned, worked third party.

Because this is a private loan, they set the terms....there are no income contingent or hardship payment plans available. Is your cosigner aware of what is happening? Even making payments, they are still likely to sue both of you.

Ya my cosigners is very aware of the situation. Not happy but aware. So I pretty much have no options at this point?