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Loan Default and 1099 income

Submitted by on Wed, 06/20/2012 - 20:08
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Hi. Thanks for providing this service.

I racked up about $130,000 in federal loan debt in grad school, then fell in love with a European and moved to Germany. We're married, and are legal residents of Germany (though I still have my US passport). I can't use my degree to work there, as the licensing is completely different, so I can't pay off the loan as I'd planned. I know they can garnish wages and such, but the only work I get paid for in the US is from occasional consulting stuff which is paid directly to me, and I file taxes on that, so there's no tax return at the end of the year. I have no assets in the U.S., won't inherit anything when my parents die, and don't anticipate living in the U.S. again (no Social Security). I don't like leaving these loans unpaid, but I can't realistically pay them. The loans have gone into default once, and I made "reasonable payments" for a year to bring them out.

Does it make sense to make an offer and try to negotiate a settlement, or should I just let them go into default? I know my credit rating in the U.S. is toast, but it's not worth $160,000 or so to me to try to fix that at this point (as if paying that much were even an option!).


well, it would be of benefit for you to get them out of default, because if you keep it there, it's jus going to accrue more and more interest, and you'll end up owing WAY more than wut you owe now... ull want to get them consolidated through the government, as that is the cheapest and quickest way to handle the situation... u dont want to have something like that jus laying around on ur record, regardless if you plan to live here again or not... u can contact a company to assist you with getting the loans handled, and there are even forgiveness programs out there that can help you out with reducing the loan amount... i contacted a company myself a few months ago to help out with my loans, and they handled everything quickly, and at a lot cheaper rate than i was expecting... i can refer u if u need some assistance...


Submitted by monkeyman on Tue, 07/03/2012 - 10:16

monkeyman

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