I wish to bypass the Collection agency & deal with Dept of Ed direct. I want to settle loan for less than total balance. Who do I contact within the Dept of Ed for settlement. I tried the customer service # and got nowhere.

Background: Garnished wages in 2000-01. Filed C-7 BK because garnishment bled me dry. Recently got letter for 30 day intent to garnish wages. Filled out hardship papers & faxed them. Takes 4 days just to verify fax. Will see what happens. Loans were taken out in late 70's/early 80's.

Who do I deal with in the Dept of Ed? I want to borrow from retirement fund to pay off loan. Principle is 22K & total owed is 58K. What is a reasonable figure to settle with ED?

Thank you.

The Department of Ed does require that you work with the collection agency the loans is assigned to. That is policy. You can work on a settlement with the collection agency.

Generally they will settle off on the collection costs. Sometimes, in cases of old loans they will negate some of the interest. $40k would be a good starting point.

for a loan that old, you still have to pay it?

There is no SOL on federally insured student loans. No BK either.