I have a 12,000 debt with dep of education (5,000) of which is an accumulation of interest.
It now has transfered to ALLIED...collection agency, and I attempted to settle this debt
through rehabilitating it -thanks to the numerous forums in here:)

This man i spoke with was the ULTIMATE jerk, and told me i couldnt rehabilitiate since it
had been so long since i graduated and didnt make a payment. He also threatened me and
said he b/c he had access to all of my checking accounts could just take the money if he
wanted to.

So....me, acting in good faith worked out a payment plan w/ him...2,000 last week, 1,000
by the 15th of January, and 220 each month after that for the next ten months.

The problem is i am slowly feeling like this dude is just collecting his commision and could
care less what happens to me afterwards.

I gave him direct access to my checking account out of good faith, but i feel like im getting
swindled.

What can/should i do now?

I really want to stop the direct access he has to my checking account and say forget this repayment
for now...until i really have the money to just pay it all off at once.

How much power does this man (collection agency) really have?
And how much does a negative school debt have on my credit?


Thanks
ML

The safest way to stop the access to your bank account is to close your account and open a new one at a different bank. If you open a new one with the same bank, they might still be able to get into it. Can't offer any other advice.

thanks,
so i guess this means they do have the power to take the money if they want....
aaaaahhhhhhhh

Close the account and move to another bank. The calculation you can make with regard to best and worst case scenarios is to multiply .15 (15%) by the amount of your paycheck after taxes. The figure you get is the most they can garnish from you. There was some talk recently about 10 percent and also up to 25% and double garnishments, but I never saw a resolution to what can REALLY happen, so I'm assuming 15% is that max. End result - unless you are making big bucks at work you can tell collector dude to piss off, close the account and let him come and garnish you for 15%.

I will give you realistic advice to avoid garnishment. Yes your have been hustled. Nowhere in the HEA (Higher Education Act) does it state that you cant rehab after a loan is so old. Everyone is entitled to this benefit, particularly if you ask for it. You need to call Allied and talk to a collection supervisor. Go thru the main switchboard and ask for a name. You need to cease the collector that is currently assigned to the account. First of all you need to tell them to CANCEL the post dated check onfile. By law and regs, they are required to do so. With a $12K account you need to be making payments of $120/month to qualify. If management doesnt want to deal with that, inform them that you will be filing complaints with
1. US Dept of Education...each agency and collector is graded on complaints.
2. Student Loan Ombudsman
3. Since I believe you are dealing with the Minnesota office, another complaint filed with the MN State AG's office. Mike Hatch hates collection agency violations.
3.FTC

All of these complaints have to be answered to in writing. In the case of Mike Hatch's office, they require screen prints which they hate to give up!!!!

I am going to see if I can find you any contacts in my sources.

thanks a billion lynn!
i was acting in good faith,
but really my lack of knowledge allowed me to get HUSTLED!!!
now i know, and knowing is half the battle (gi joe!)

thank you so much.
im calling tomorrow!!!
but what do i do about the 2,000 withdrawn from my account
from last week?
i guess it is too late to retract that,
but im sure if i talk to someone to get a print out or proof of
payment on the loan,
i can use that 2,000 to lower the principal balance,
hence lower intrest...
right?

Has the $2k cleared your account yet?? If not?? Stop pay it NOW!!!

yes, the money has cleared, so i guess its a loss...
how frustrating!!!

while in the process of getting complaints answered in
writing, i will have to close my account b/c the next
scheduled withdrawl is on the 15th of this month.

wish me luck!!!