Reader Jennifer sent the following letter to a few lawyers looking for some help with SallieMae. They told her that there was nothing she could do and to negotiate with the lender and to start making payments:
Hello,
I’m writing this email to express my interest in your services. I’m looking for some legal help with the matter of my student loans with Sallie Mae. Basically my situation is that for the past 3 and half years I haven’t been stable, financially or emotionally. I’ve also have had difficulty finding and keeping a job and I have not had a steady place to live, basically staying with different friends for a few months at a time. During this time I haven’t contacted Sallie Mae about my loans. Initially I had talked to them a few years ago and they threatened to garnish my wages but at the time I wasn’t working so there wasn’t much I could say in response. I’ve changed addresses and phone numbers several times in the past few years and I’ve lost contact with them. My parents have mentioned that they’ve received calls and letters but without a stable place to live or work I didn’t contact Sallie Mae.
Recently I started a pretty good job that I’ve had for the past 4 months and I’m doing well. I have a stable place to live and I’m making enough money to support myself. With what I make, it’s about enough to pay my rent and utilities, but I still don’t make much more than that to be able to start making the $400 a month payments they want from me. I would like to start making some kind of payments for now and increase that amount as my financial situation improves.
I’m afraid however to contact them because of threats they’ve made about garnishing wages in the past. They told me that they can take up to 25% of my pay, and frankly if I lost a quarter of my income I’d lose my place to live and be unable to get to work and be at square 1 again. I’ve read on the consumerist (www.consumerist.com) about Sallie Mae harassing people and causing them to lose their jobs. So I would prefer to have an attorney contact them for me initially to set up an agreement and to help me understand what they can and cannot do. I’ve also read about debt collection agencies illegally threatening and insulting people, and I’d to be informed about my rights in this matter.
I’d like to make an appointment for a consultation. Please let me know if you think you can help me and what you can do for me and what your rates would be. Thank you very much for your time.
Regards,
Jennifer
Congratulations on getting a job and turning your life around! If you had federal loans, the answer would be simple, because they have flexible loan workout programs that can help people who have been through some tough times. Private loans are much more difficult to deal with. Student lenders have broad rights not available to traditional “debt collectors,” and it can be difficult to get back on track, even if you’re well-meaning.
According to the Student Loan Borrower Assistance website, your private lender isn’t required to offer you income based repayment like you would get if you had a federal loan. You should contact them, however, and ask them what income-based options they are willing to offer you.
Sadly, the best recourse for you may be to file bankruptcy. It’s very difficult to get your student loans discharged through bankruptcy, but it isn’t impossible. You’ll need to prove that repaying your loan will cause you undue hardship:
Courts use different tests to evaluate whether a particular borrower has shown an undue hardship. A common test is the Brunner test which requires a showing that 1) the debtor cannot maintain, based on current income and expenses, a “minimal” standard of living for the debtor and the debtor’s dependents if forced to repay the student loans; 2) additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and 3) the debtor has made good faith efforts to repay the loans. (Brunner v. New York State Higher Educ. Servs. Corp., 831 F. 2d 395 (2d Cir. 1987). Not all courts use this test. Some courts will be more flexible.
If you can successfully prove undue hardship, your student loan will be completely canceled. Filing for bankruptcy also automatically protects you from collection actions on all of your debts, at least until the bankruptcy case is resolved or until the creditor gets permission from the court to start collecting again.
Assuming you can discharge your student loan debt by proving hardship, bankruptcy may be a good option for you. It is a good idea to first consult with a lawyer or other professional to understand other pros and cons associated with bankruptcy. For example, a bankruptcy can remain part of your credit history for ten years. There are costs associated with filing for bankruptcy as well as a number of procedural hurdles.
Even if you can’t get the loans discharged, you can repay them using a Chapter 13 repayment plan:
CHAPTER 13 and STUDENT LOANS
A case under chapter 13 is often called “reorganization.” In a chapter 13 case, you submit a plan to repay your creditors over time, usually from future income. These plans allow you to get caught up on mortgages or car loans and other secured debts. If you cannot discharge your student loans based on undue hardship in either a chapter 7 or chapter 13 bankruptcy, there are still certain advantages to filing a chapter 13 bankruptcy. One advantage is that your chapter 13 plan, not your loan holder will determine the size of your student loan payments. You will make these court-determined payments while you are in the Chapter 13 plan, usually for three to five years. You will still owe the remainder of your student loans when you come out of bankruptcy, but you can try at this point to discharge the remainder based on undue hardship. While you are repaying through the bankruptcy court, there will be no collection actions taken against you.
Why not talk to a bankruptcy lawyer? It’s obvious from your letter that you want to pay your loan, just not while living on the streets. Good luck!
Has anyone successfully negotiated smaller payments with Sallie Mae? Share your advice in the comments.
Student Loans & Bankruptcy [Student Loan Borrowers Assistance]
More From Consumerist
-
Mattress-Jumping Isn’t Just Child’s Play; It’s A Real Job
-
That’s Great, UPS: Just Fling My $1,200 Laptop At The Porch Without Getting A Signature
-
Best Buy Founder Writes Lovelorn Letter To Board In Buyout Quest: "I Am Not Going Away"
-
Walmart Still Ignoring Customer Whose Engine Was Ruined In Botched Oil Change
-
Kohl’s Staff Is Helpless When Gift Card System Goes Down
Jennifer, look first things first, is your in trouble. Student loans are one of those things that just don’t go away. Whether you have $1500 or $15,000 your going to have to repay them. So, with that, my advice would be to hold off on an attorney or filing bankrupcy and call AES (American Education Services/Stafford Loan) I don’t know if this is possible, but see if you can consolidate through them. It is government based and they have many options of repayment available. I am currently on the lifetime plan
, it’s actually the 15 year, it has been good because I can repay slowly and not kill myself. This situation will not resolve quickly. It will take time, but patience is what you need. If AES turns you down, then contact Sallie Mae. Talk with them, explain your situation, and take the advice of some of the people here and don’t give them any other personal information, such as job or bank. If they require an address and it’s possible give your parents address. Tell them the truth, explain that you were scared because you couldn’t pay and you know now that you should have contacted them and you want to repair the situation. Explain that you can’t afford $X dollar, but you can afford $X. My experience has taught me also to be persistent. If the first call doesn’t work, try again, your goal is to get the bleeding heart. Someone who feels they need to do something good for the day. In my early years, I did what you did, I ran, I hid, I was scared. But, it gets very overwhelming, very fast. Don’t let this get get the best of you, you will get through it. It will be tough, but stay strong. Good Luck!
The attitude expressed in a number of these comments about college majors is really sad. Not everybody treats college as merely a trade school, the only purpose of which is to get a good job — that’s not the true point of education and sean77 makes an excellent comment. Education is about improving yourself and your outlook. Financial success is a nice byproduct for anyone with a good head on his/her shoulders. And for those people, college probably isn’t necessary. But should they choose college, why not study what interests them?
In my unscientific study based on personal anecdotes, I can tell you that of my high achieving college friends, the most successful in terms of their employment were biology, theology, sociology and English majors. By the same token, my friends with undergraduate business degrees are mostly workaday drones, slugging along towards retirement at everybody-else speed.
I’m pretty much in the same position as Jennifer. I was going to college for about a year and 1/2, of course I took out a loan. Eventually I lost my job and couldn’t pay my tutition at school (Westwood college Calumet City, Illinois) and they told me I had to pay the tuition or stop going. This was back in like late 2006. Now it’s 2008 and I was trying to go to ivy tech, but i couldn’t get a loan through fafsa because of my previous one and I have a job now but it’s just so i can save up so my girlfriend and I can have a place of our own. After doing some research I found out I’m able to get my certificate for just over $2,000, but i’d probably have to end up paying cash. The people from EdFund have been calling me about repaying, but as of now I can’t and the amount they want me to pay per month keeps changing, it went from $250, to $150, now it’s $199, so i know there’s no set amount I’d have to pay per month. As I said the job i have now is just to save up before i move so we’d be settled and a while before we do move I’ll be applying at places. and of course I can’t pay back loans then while i have to pay rent, bills, food, and with the rise of gas prices that’s another burden. I’d hate to have to file for bankruptcy at the age of 22.
I planned ahead for this being poor immediately after college thing. I majored in Journalism and English. I could do a lot of things, but insisted on living in a big city with outrageous cost-of-living and wanted a job I liked, not one that paid well. So after doing lots of research (including paying very close attention during my government(I think?)-mandated loan counseling course prior to graduation, I signed up for interest-only loan payments for the next four years (from Sallie Mae, no less) until I become more stable. Or marry rich, whichever comes first.
@mac-phisto:
Ding Ding Ding! We have a winner.
3 out of 4 years, I had an EFC of exactly 0. That means you qualify for every last government program that exists for education. Pell grants, state grants, subsidized loans, etc., I got them all.
I graduated last year and am now ready to start paying back $40,000 in student loans … and I went to a state school!
I’ll blame Ohio for having the just about highest state tuition in the nation, but the idea that the poor get everything for free simply isn’t true.
@ceejeemcbeegee: Why would any other lender want to take a chance on her when she’s not worked with her previous lender at all and in fact dodged any opportunity to communicate with them?
I don’t have any helpful suggestions other than do what you can to make in-good-faith reparations with your lender, or at least start the freaking conversation with them. People who choose avoidance as a way to deal with their creditors are only digging their hole deeper in the process.
First, find out if you’re still dealing with Sallie Mae, or if you’re dealing with a Debt-Collection Agency.
If you’re dealing with Sallie Mae, you should talk to them about some sort of deferment or other options to help you in paying back the loan in a more reasonable time period. This may not be an option, though, since you’ve (in their opinion) been avoiding paying this debt for a long time.
If it’s a Debt Collection Agency, you may be able to negotiate to a lower payoff. GET THIS IN WRITING if they agree to accept a smaller sum. Then work out monthly or bi-weekly payments.
I recommend picking up (or checking out from the library) Dave Ramsey’s book called “Financial Peace Revisited”. It touches on the topic of debt and repayment, and he suggests a “Pro Rata” plan for when your monthly payments outstrip your available income.
Basically, you send your debtors a financial statement each month outlining your personal needs (shelter, food, health, etc.) and showing the remaining amount. If there’s one debtor, you pay them this amount. If you have multiples, you pay them their “percentage” of the debt – if one debtor is 80% of your debt, you pay them 80% of that remaining amount.
This should keep them off your back while you work things out. Also, pick up a second job and attack this debt like nobody’s business!
Sorry, but you knew the terms when you took out your student loan. You also dodged them for a few years, are we really supposed to feel sorry for you?
We should also blame these colleges for offering useless degrees. Do you know how many art students I personally know? They should honestly say, “here’s your art degree, get ready to be a manager at McDonalds.”
@nequam: I totally agree with you (I’m majoring in French, so I guess I qualify as having a “useless” major). As someone who spent her first three years miserably studying chemistry, I can tell you that it was much more valuable to me to study something I love – languages – than to study something that might get me a higher-paying job.
I now speak Italian and French fluently and am learning Spanish. No, I’m not going to be a billionaire, but I hate the sentiment that if you don’t major in science or engineering, you’ll work at McDonald’s.
And to dandd, my cousin and my best friend graduated last year. My cousin majored in computer engineering and my best friend majored in studio art. She currently has a job at a software development company in our area as a graphic designer. He is unemployed and having a hard time finding a job. I guess my point is, the major isn’t always the be-all, end-all that decides what you are going to do after college. I think a lot of employers look for college education as a sign that you committed four years of your life to something and followed through and that you have been given formal schooling beyond high school.
@nequam: I’m not saying your opinion is wrong, but I believe you’re in the minority. Most people I know went/go to college to get a (better) job.
@dandd: I can’t blame her for the dodging. Sometimes people go through rough patches in their life where the only available way to cope is to run and hide.
@stinerman: I went to an out-of-state school (tuition about 1.5 times in-state at Ohio), received the same from my parents as you likely received in grants (~$6k/year), and finished $16k in debt.
What does this story mean? Nothing. Your total, my total, and xtc46′s total don’t bring anything to the table.
That said, I agree that the belief that “the poor” get stuff for free and without working is flawed. It’s not true.
@dandd: She never asked for your sympathy. Or your opinion.
@lasereric41: Why’d he get his master’s degree and $50k of debt instead of a job? Oh snap, your example has nothing to do with your thesis statement. Not even close. See sean77.
(Full Disclosure: I also got a master’s degree and extra debt instead of a job. But if it all goes sour, I agree to blame myself instead of the system.)
Ya know, I work as a bankruptcy paralegal, and I have to give a few comments about what a Chapter 13 really does. A Chapter 13 only works if you have a minimum income. The IRS sets the standard for a minimum income, and it is not a good idea to try and go for a Chapter 13 if you don’t have any disposable income to pay into it. And that still wouldn’t fix this girls situation. Student Loans are all but impossible to get rid of, as has been pointed out in this post. They are, in effect, non-dischargable. So, if this girl could fund a Chapter 13, and didn’t have any other debts that were paid as part of that plan, she would still not get it completely paid off. At the end of that plan, she would still have to pay them off. Let’s face it, this is one of those debts that she can’t get rid of. I would still tell her to talk to a bankruptcy lawyer though, since they might be more willing to help her negotiate with Sallie Mae. When the BK (Bankruptcy) laws changed in 2005, almost all of the BK lawyers got out the of the game. Most attorneys, if they don’t deal with collections themselves, don’t want to get involved in this. The other thing that might work would be to go to Debt Reduction Services, or a similar place, and see if they can’t negotiate for her with Sallie Mae.
@oakie:
Talking about how lucrative a major will be in the future job market is nonsense. A major that is a sure ticket to job security when you start college may not be one by the time you graduate. Also, college is about producing educated people, not trade workers. In America, it seems people think the only reason to be educated is for work. How about just so you’re a better person? If you want only to get a job, learn to be a plumber or some other job where you go to trade school or apprentice with a company.
The OP said she had issues with emotional problems and security, not simply that she couldn’t find a job. The cold reaction some people offer smacks of those who had more choices than she did.
If I were in her shoes at this point, I’d contact them via a non-traceable address (post box or whatnot) and see if a payment plan was possible, but I’d be very tempted to simply ignore it and wait until I could make payments more easily. You can always sock away any spare cash and have a lump sum payment in hand when you finally got in touch with them.
absolute worst decision I have made in my life was getting involved with ITT and Sallie Mae. I went 2 days and realized what a joke eduacation it was; I left a class and went directly to the Dean’s office to remove myself. Shortly thereafter I started receiving letters about the 6k I owed. and still owe…anything short of the lottery or proverbial rich dying uncle leaves me unable to pay them and stop the harassment.
I work in the Student loan industry, and maybe I could offer a bit of advice.
There’s a really good program that might be able to help her. It’s called the William D. Ford Consolidation. Basically the Department of Ed can step in, bring her loans out of default, and once they’re out of default, base her payments on her income and family size. The webpage is http://www.loanconsolidation.ed.gov
You can file online, and all the documents you need to fill out are on the website. The 3 most important are all under the forms and publications page.
Application and Promissory Note
Repayment Plan Selection
Income Contingent Repayment Plan Consent to Disclosure of Tax Information
It doesn’t cost anything extra. In fact they actually lower your collection charges from 24% of the balance to 18.5%, so the balance goes down. You cannot be turned down for the program either. Just make sure you get all your paperwork done ASAP though. You only have 30 days from the time you file online to get the paperwork back to them.
@TheBestMaxEver: Realistically, you could get about $150 per bj in the Phoenix area.
another avenue to slavery.
@PirateSmurf:
Yeah, RIGHT – let the guvment pay for it! And how many MORE idiots will flitter away 4 years in college on stupid degrees like Art, Music, etc? If you are an artist or a musician, you don’t need a college education. Go perform, do what you do, don’t waste time in school. We need more people taking up trades, skilled workers doing good work, instead of HS drop outs that can’t do anything else.
@nequam:
Yeah, that works if your family is already rich and you just want to learn for learnings sake. The point of college, in THIS country, is to get ahead. That’s what EVERY college commercial, pamphlet, etc, etc, etc says. Are you asleep?
I graduated almost two years ago now with about $23k in school loan debt, not counting what my parents took on (thank you shitty Ohio education system!). Thank god I was able to take that all out from government loans, but I still feel suffocated by it. I make my payment on time every month and I will still be paying for probably the next 10 to 15 years. Was it worth it? It seemed like it at the time. Ask me again in five years. I did get a good job out of college, but the bills really add up.
If you’ve seen Sicko, Tony Benn talks about a very interesting theory of his wherein the government actually encourages debt. When people have debt, they are afraid to lose their jobs. When people are afraid to lose their jobs, they are afraid to protest and make a ruckus to better their lives. (For example, how many of us with full-time jobs can jaunt off to DC for a week-long protest of working conditions?) So, the government currently has no reason to fix our education system, and in fact has many reasons to allow universities to charge us even more.
The solution? I’m moving to Europe as soon as we can afford it. At least my future children can have a better start in their adult lives. If we don’t get to do that, I’ll be running for president in 2020.
No Exceptional Circumstances Needed for Student Loan Discharge
Educational Credit Management Corp. v. Nys, 04-16007 (9th Cir., Apr. 26, 2006)
Since so many of us are up to our eyeballs in student loan debt, there might be a lot of vicarious interest in this Ninth Circuit student loan discharge case. Lorna Nys owes $85,000 in student loans, up from an original principal of $30,000. She filed for a discharge, arguing that her income of $36,000 does not allow her to repay her loans, and that at the age of 51, she has no hope of making any more money in her dead-end job and will be in even worse straits once she retires at 65.
The bankruptcy court found that Nys was unable to repay her loans but still refused to discharge them because Nys had not shown any kind of “exceptional circumstance” – like a disability or a sick child – that would prevent her from repayment. She’s just your run-of-the-mill debtor with a modest income, high loan payments, and a house that always needs repairs. But the Bankruptcy Appellate Panel reversed on the ground that Nys only needed to show that she could not repay the loans now or in the future, and the Ninth Circuit affirms. It remands the matter with instructions that the bankruptcy court apply the proper tests for remand.
Student loan discharges are usually held to a very high standard, but this surprising decision opens up the possibility of discharge to many more mainstream debtors who don’t have a tragic story to tell the judge.
@CMU_Bueller: You know, as somebody who majored in a “risky” major and then has managed to keep my loans in order and pay them off at a reasonable rate, I resent a lot of what you’re saying.
So I’m a film major, you think that means I should have a larger interest rate on my loan because I’m a “risk” because YOU don’t see what I could do with a film major?
Not to mention the fact that just because I have a degree in film doesn’t mean that I didn’t just get a job in whatever I could when I was unemployed. Yeah, I could have bummed around L.A. waiting for somebody to hand me a job at a studio, but instead I actually cared about keeping my finances in order.
Not every liberal arts person is an unemployed loan risk. Your major has NOTHING to do with it, your personality and your own sense of responsibility does.
I remember how we got here…
When I matriculated,it became something of a parlor game for foreign students (notably Indians and Pakistanis) to talk openly about the thousands of $$$ they got from uncle Sam to go to school and then when they graduated,they were high tailin’ it back to the mother country… The U.S. taxpayer would be stuck for the tab and they would practice medicine or engineering etc.,and send their kids over here,wash ,rinse and repeat…To be sure,there was a lot of knowledge among U.S. students about reneging on their loans,but the foreign students had it down to a mathematical science.
Is this still possible?
@ericole: Nequam said “not everyone”. That only requires 1 exception. And no, not every commercial says that:
@Beki: The government does encourage debt. It’s a problem that private lenders will give you all the candy you ask for (and tell you’re not getting a real education unless you go to Harvard). But it’s an availability problem: it’s up to the student to just say no, “I can’t afford taking out this much debt.” Unfortunately, it’s hard to foresee that when you’re 17. Let your children know that one can take a break from education at any time, work a couple jobs, go to a cheaper school, go to community college for the first few years….
Maybe in 10 years or so, the economy will collapse again because of the sub-prime-student-lending crisis (or if we’re lucky, Sallie Mae will collapse in this round). Redirecting the subsidies to lenders is a good start.
@Snarkysnake: No. In fact, that’s an unsubstantiated assertion and totally irrelevant.
@ericole: High school dropouts can’t get into college, generally speaking. But if nothing else, you did demonstrate ignorance by equating art and and music majors with high school dropouts.
Just because it’s free doesn’t mean they’ll let everyone in: the number of people a major will enroll is related to the number of graduates that field needs. For example, music performance (a minority of music majors) is highly selective.
Please do some research about what various fields and specializations actually entail before you carelessly call vast swaths of them “stupid”: What can I do with a ____ Major?
I went into electrical engineering and computer science ‘cuz I figured that just about everything runs on electricity and has a computer chip in it, so how could I go wrong? The top two worst professions to be in? Electrical engineering and computer science. Ah, outsourcing.
EVERYONE supports education. It is the way by which the government (us) invests in its own people for a wealthy & prosperous middle class (see the GI Bill of WW2.) The citizens themselves are now being tasked to carry this risk alone, and the result is 21st century version of indentured servitude.
Previous comments have pointed out that an indebted workforce is inherently fearful of unemployment since the loan will not be discharged EVER (there is no statute of limitations on murder, rape or student loans). While this is very true, it misses two points.
First is the corruption by business interests around the student loan program ostensibly designed to help people achieve a higher education. Private interests charge exorbitant fees for no-risk government backed loans. [A great deal of the current fiscal meltdown involves trading bundled loans, and since payback is government assured, these are the best loans for banks to trade.] Think about it: exactly why should private investment groups be allowed to make ridiculously high profits though the non-risk government-guaranteed loans of a social program?
Secondly is what the government learned in the 1960′s: why should tax money be spent to educate a populace that will only then question government policies? Follow the amount of grant money and collegiate costs and they both skyrocket after the 1960s and the social upheaval of the civil rights, woman’s rights & Vietnam War protestors. NOT a coincidence.
George Carlin says it best:
+ Watch video
@Michael Belisle:
No,it’s not unsubstantiated. You don’t know what you’re talking about .I have seen this myself. This happened not a few years back.
first, I got lucky: went to state school, worked, and had some money come my way from the sale of my family home. so I got out without debt. sorry for all currently struggling.
@snarkysnake, I’m puzzled. I have no idea how these foreign students got “thousands of $$$ they got from uncle Sam to go to school” when government/federal loans aka uncle Sam, are restricted to US citizens and permanent residents.
Basically undue hardship has to be because of a permanent change in earning capacity that is beyond your control. Need to demonstrate physical, mental, emotional and/or psychiatric disabilities or impairments preventing one from working. Not market conditions. Also, being old during repayment is irrelevant, it does not matter if repayment goes on after you retire and into your 70′s.
You must show that you have “repaid the loan over the entire time period from the date on which the first loan payment became due to the date on which the debtor filed his bankruptcy petition.” In re Cehula, 327 B.R. 241 (2005). You need to show you take the payments seriously and have done your utmost to repay them.
The financial difficulty has to be beyond your control and not caused by your negligence or willful default.
The Dept. of Education has added the Income Continent Repayment Plan. Because of this plan you now have a much harder time arguing “undue hardship.” You should try to use this plan.
The court also looks at the ratio of loan left to be repaid and what has been paid. For example trying to discharge 70% of the debt was found not to be in good faith.
@levenhopper: Wrong.
In fact, the way I found out about my bankruptcy being cleared was via a mailer from a car dealership congratulating me and offering wonderful deals for a leasing new car. It arrived before the official court papers.
Since then I’ve received almost non-stop pre-approved offers for things – credit cards, mortgages, vehicles, even catalogs with pre-approved store credit! They may not be the wonderful sparkling deals offered to the average consumers, but businesses are still more than willing to contract with me and take my money. Two years out from my bankruptcy and I have one [active, new] credit card and remarkably good credit. Yes yes, woe to me, my life is… oh wait, NOT ruined!
See, my bankruptcy lawyer talked with me about what happens “afterward” during our meetings. Obviously you’re misinformed and are not speaking from experience, so now you can stop perpetuating the horrible boogie man stories. Myth busted.
@sean77: education is not free. you pay for it in taxes. it’s just mandatory as opposed to optional.
@firesign: i should amend that to say k-12 education.
@PirateSmurf: or at least reasonably priced. and reasonable does not equal the absurd amounts being charged right now.
1 sided victim blamers: RTL. lack of emotional stability often seriously aggravates financial stability as the persons ability to function is impaired.
@stinerman: EFC?
@nequam: bingo & well said.
@goddesssparkle: “First off, I agree that education should be government subsidized. Those who carry on about taxes just don’t get it. Having a better-educated population makes the nation and economy stronger. I’ve traveled extensively and lived overseas: the countries where education is a given if you’ve got the grades are much better off. If the US doesn’t catch on, we will be left by the wayside as other economies and nations progress more rapidly.” Excellent points.
I wasn’t able to. I owed them 7,000+ based on my own stupidity (I took a medical leave, and was under the impression that I wouldn’t have to start paying the loan back till I finished school, but was dead wrong, and then defaulted) They told me they would let me pay $88 every two weeks, and I supplied them with my bank information, and the proper signatures to do it, and they didn’t do it, tacked on some fees, and garnished my checks. I now get roughly 40% of my checks if I’m lucky after my taxes, insurance and the garnishment, which leaves me very little to live on. I also cannot go back to school until the garnishment is done, because since a student loan defaulted, I am not longer eligible for state or federal financial aid – and they automatically get my tax refund (I don’t even know about that stimulus thing, but I imagine that goes to them, too)