I have a friend that has defaulted on her federal student loans. They have already been consolidated. She isn't eligible for forebearance, etc because it has already defaulted. They are threatening to garnish wages if she can't pay $2000 right now plus $450 every month for the next 9 months to "Rehabilitate" her loan. Do yall know of any options she might have?
None. You cannot even discharge student loans in bankruptcy. Start paying something right now to show your intentions are good and contact the lender to show your good faith, explain your financial situation and create a payment plan.
She needs to call the loan place and ask them about an income based repayment plan. The do have things they can do to help get the loan repaid to them. My husband has defaulted on his student loans due to hardships and they have us on an income based repayment plan. She will basically have to fill out paperwork that they will send her and mail it back with paycheck stubs and/or her last tax return.
HTH
Look into this new program:
http://www.ibrinfo.org/
I pay through the Dept of Ed's Direct Loan program, and by signing up through IBR, I was able to reduce my payments. Paying something should keep them off your back. Don't let them bully you. Good luck.
I have had the same problem. They have the authority to waive the initial "down payment" but they don't like to tell you that. They are generally very aggressive and not easy to work with. They are actually not part of the federal government...just some company that is hired to collect on defaulted loans. I've never actually heard of anyone who had their wages garnished, but I have been told that they really can do that to you. I would tell your friend to talk to them again & tell them she can't pay such a huge downpayment but would be willing to make monthly payments. In my experience, they don't budge too much on the monthly payments but she can try to negotiate with that as well. HOWEVER, please also share with her to READ THE FINE PRINT! I paid for 1 1/2 years on this "rehabilitation" plan & was promised that as soon as I was moved out of the rehabilitation plan, my payments would be lowered. They continually told me to give them another month or two & they would have my loan sold & the payments would go down. Then the market crashed & no one would buy my rehabilitated loan. SO, my payments continued to be gigantic! I could no longer afford them & so my loan went into default again. That's where it stands right now. I hope your friend gets it all worked out & it goes better than it did with mine!
Check with a credit counselor or a different credit union maybe they have other options.
