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Co-signer attempt to pay on a defaulted student loan

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I am (unfortunately) a cosigner on a student loan that my son took out near the end of his doctorate program with a national education service. The debt (which now is about two third of the original $10,000) had now go into default. I realize I should have been paying more attention to this, but I am on it now.
I tried without success to talk to the education service about this-they say they no longer own the loan-the collection agency owns the loan. I spoke to the collection agency and they say the education service owns the loan. So apparently I can't get a straight answer.
I have offered to pay the balance on the loan (which is unsecured) plus late fees and a penalty fee. The agency refused my money, insisting they will collect an additional 25% of the total, bringing the loan to near the starting point. I am trying to be responsible here, but I just can't agree to this.
Do I have any options here? (Sorry for the length.)




Register with the forum so you get email replies. You may have been talking to some idiot at the NES who doesn't know the difference between assignment of a debt and selling of a debt. Soaplady will correct me if I am wrong but student loans are almost never sold, they are just assigned to collectors. Wait for soaplady to answer the question but for now register with the site. She used to collect student loans so she knows this stuff very well.

Sub: #1 posted on Wed, 11/28/2012 - 20:40

waffles waffles
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(Posts: 1697 | Credits: )

Correct....student loans are assigned to collection agencies, not sold.

Your current balance will include daily accruing interest and more than likely collection costs. Collection fees run on average about 25% and you both agreed to pay them in your original prom note.

Have you asked for a settlement??

Sub: #2 posted on Wed, 11/28/2012 - 20:55

SOAPLADY SOAPLADY
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