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Hello, I have a $8000 student loan that was done with Sallie Mae that since has been in default for a couple years now...

Recently I got a letter in the mail from NCO Financial that they would be starting the process of collection of the defaulted loan by Treasury offset in 65 days if I do nothing.

I really want to take care of this but I know I can't make the payments they'd want. So, after doing some research on this site I want to ask them if I can make payments by citing the Higher Education Act and the Student Loan Ombudsman that way I know I can at least manage to pay them something and get this whole process started.

I'm just wondering if I can do all this by typing up a letter and sending it to NCO? I just hate telephones and even worse talking to people about money over the phone... I'll bite the bullet though if I have to but I'd much rather do it with the letter that way I'm sure of what I'm agreeing to because sometimes talking to people things can get cloudy for me at least...

- Brandon




I work in education and I can tell you that communication is key in getting these things taken care of. Student loans are serious debt and can cause you a lot of trouble. Have you tried getting them deferred? You shuodl probably call NCO and try to set up a payment plan that works for you.

Sub: #1 posted on Fri, 08/15/2008 - 11:27

cdollar cdollar

(Posts: 227 | Credits: )

nope...they will not negotiate via mail and there is a reason for this. The CA cannot and will not put in writing any agreement that implys a payment plan....part of this stems from the fact that they cannot alter or change the terms of your promisory note.

You can cite any references you want but you have a prom note whereby you agreed to balance in full on demand. Unless you are specifically asking for the rehab program, you do not have any rights to paying them something. Paying them something with out an oral payment plan will not prevent wage garnishment or treasurey offset.

With a $8k balance (you didnt say whether this is the original balance or the current balance updated with interest and collection fees) you would be looking at a standard rehab payment of 1% or $80-$100 per month. They can go lower but you will need to provide proof of income and expenses for anything lower than that. Keep in mind, they will have a copy of your credit report.

Sub: #2 posted on Fri, 08/15/2008 - 11:37

SOAPLADY SOAPLADY
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Quote:
Have you tried getting them deferred? You shuodl probably call NCO and try to set up a payment plan that works for you.


Once you default, you are no longer eligible for deferments or forebearances.

Sub: #3 posted on Fri, 08/15/2008 - 11:39

SOAPLADY SOAPLADY
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You can sometimes get a hardship deferrment, but it depends on how long you have been in default and your ability to agree upon a payment plan. At least that what some of my students have done.

Sub: #4 posted on Fri, 08/15/2008 - 11:40

cdollar cdollar

(Posts: 227 | Credits: )

Quote:
You can sometimes get a hardship deferrment, but it depends on how long you have been in default and your ability to agree upon a payment plan. At least that what some of my students have done.


Not in default you cant. No such thing. I spent almost a decade collecting on both FFELP and DOE loans and neither program has any hardship programs while in default that include not paying. You can negotiate a low payment based on income but no agency will agree to no payment.

Sub: #5 posted on Fri, 08/15/2008 - 12:27

SOAPLADY SOAPLADY
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So yeah, I understand I have to call them up. One thing though, I have to specifically ask for a rehab program when speaking with them? I just want to be sure on what to say, I don't want to screw it up for myself even further...

And $8,000 is about what it says in the letter they sent me so I'm assuming that's how much I owe... Thanks for your prompt replies this site is a great help and so are you Soaplady!

Sub: #6 posted on Fri, 08/15/2008 - 17:05

Unregistered


I just want to be clear...

Do I have to say I want to rehab the loan or somehow enter a rehab program for the loan? What exactly should I say? Or should I just see if I can get the payments down to a reasonable level without doing a rehab or do you think that's not possible???

Sub: #7 posted on Tue, 08/19/2008 - 15:11

ideletemyself ideletemyself

(Posts: 3 | Credits: )

Why would you not want to rehab?? You cant make payments to the CA forever...they will put the pressure on to get your loan out of default, and your only choices are paying it in full, rehab or consolidation. It is not doing your credit any good to stay in default as you do not get credit for making payments on a bad debt.

You have to specifically ask for rehab and reasonable and afford payments.

Sub: #8 posted on Wed, 08/20/2008 - 09:36

SOAPLADY SOAPLADY
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I'm sorry if I was unclear.

But I DO want to enter a rehab for my defaulted loan. That's what I was trying to figure out is HOW to properly ask since that's what you're telling me I have to do.

I don't want to be rude or preceived as being rude, I just want to ask them in the best manner possible that way I can get this whole mess taken care of...

Sub: #9 posted on Wed, 08/20/2008 - 09:42

ideletemyself ideletemyself

(Posts: 3 | Credits: )

Quote:
Originally Posted by ideletemyself
I'm sorry if I was unclear.
But I DO want to enter a rehab for my defaulted loan. That's what I was trying to figure out is HOW to properly ask since that's what you're telling me I have to do.
I don't want to be rude or preceived as being rude, I just want to ask them in the best manner possible that way I can get this whole mess taken care of...





Ask for the rehab program. Mind you the rehab is not based on reasonable and affordable payments. It is based on principle and interest. they take a financial statement from you because that proves to the gov and client that you can not pay the entire balance in full. if you got a letter stating that it is 8,000(based on who the client is that sent you the letter, chances are the default charge isn't added on yet), your monthly payments should not be that high. but that does also depend on your interest rate on your loan. nco wil prolly ask for a down payment as well. the reason being for that is it supposed to help bring down your balance and also cut down the time estimated on paying your loan back. i know it is the only program out there that helps your credit

Sub: #10 posted on Tue, 11/02/2010 - 21:23

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