Should I make the frowned upon phone call?? I know the phone is a big NO NO in this forum.. But I do not want to dispute it.. I want to pay it.. I had no Idea I had even owed them money until it showed on my report as a late account.. I thought I only needed to pay my student loans, which I have been doing.. Apparently, I need to pay back the financial aid I was awarded for some classes I had dropped for personal reasons...

Now my question is this... I don't think I should write a goodwill letter because I have never made a payment... Should I just call the 800# and explain to them my situation, set up a payment plan and ask them to update to CRA's after a couple of months?

The US Dept of Education is very willing to work with people who want to pay their loans back. In this case, I would think it is fine to call them. You can get on-line account access with them too. You can make on-line payments and send them emails from the site.

Oh, wow.. That is great news! Have you personally had success using this approach?

I hate to burst your bubble, but they may not be willing to remove the derogatory marks from your credit (if any). They may be willing to help you to give them back their money, but it has been my experience that they keep very good records and do not let anything slide, even as a goodwill removal. Good luck, though, perhaps you will be the exception to the rule with them. Let us know!

Kris

*heavy sigh* Okay.. I will definitely keep u updated! I just hope that u if you are right and they do keep very good records, then they will at least update my report so it at leasts looks like I am trying.. I would hate for them to only report the bad and not the good..

If you are in default, then you will be able to set up rehab - do a search here for that. In some instances, this WILL remove the negative notations from your account. You will need to call them - this is the ONLY time it's acceptable to use the phone in a credit-related situation. LOL

If you need help, let us know.

How long ago where you in school?? How far into the semester where you?? When you drop classes before a certain date, FA is returned to the lender. Have you checked with your school to make sure that you have no balance with them?? Often with drops, it will create a student acount balance as well.

Student loans are the one case that you do need to call. They will not communicate in writing nor will they do rehab via mail. Open communication is vital.

I actually dropped classes too late to get the money returned, I waited until I saw that my grades were not what they needed to be so instead of taking the chance of tarnishing my 4.0 I bowed out gracefully.. This was exacly 1 year ago.

Thanks guys so much for ur advice.. I will be calling them TODAY and hopefully be able to start payments on this thing as soon as Thursday.. hopefully they will remove the negs but if not Ill just have to grin and bear it and just work that much harder to fix everything else.

I will definitely keep u updated...

If you seperated from school a year ago, you should be six months beyond your grace period and not in default yet. Does the DOE have your correct mailing address?? You should have been getting letters up the wazo by now. There is really no way that they are going to remove any negative information and if you havent defaulted yet, rehab is not a possibility. Make sure you check you account at the school too...if you have a balance on your student account, you cannot enroll or get a transcript until that is resolved too.

These are all questions I will be asking today, I have not received Letter 1 from the Dept of Ed. But Nelnet (Student Loans) Send me stuff all of the time (BTW them, I am current with) and I would assume that if Nelnet has the right address for me then so should the Dept of Ed, considering that the School handles the app process with both of them.

I will also be calling the School because when I checked they're site they show me with a balance of $800 Dollars NOT the $300 and change the DOE is reporting. so Now I am really confused!!! The problem is with the school the offices close at 5 and that is when I get out of work.. I am thinking I will leave early today and sit down there with someone, maybe they can handle both situations??

What do u think?

BTW this is how it is showing on my tc report..

US DEPT ED More about this account >>


Account No.: ***************** ***************** VALEN-**********
Condition: Derogatory Derogatory Derogatory
Balance: $306 $306 $306
Type: Educational Educational Collection
Pay Status: Collection/Chargeoff Collection/Chargeoff Late 120 Days

And I thought the 6 month thing only applied IF u graduate.. if no graduation then u must pay back immediately?

What is on your school account has nothing to do with the DOE. It is totally seperate. The school account is what you owe the school after the FA was returned.

Addresses can be complicated depending on what you put down on which application. There are also home and school address fields.

You said you got a DOE letter?? I am a little confused as NELNET is a FFELP lender, seperate from the DOE. Do you have older loans thru Nelnet? Was this last one thru Direct Loans??

Did I say that?? Im confused now too!! MAybe its cause I am typing as I am getting ready for work. hehehe

No I never received anything from the DOE about any balance being due..My credit report is the first I am hearing of it...The only correspondence I have received has been directly from nelnet regarding the loans I took out for what the financial aid/ Pell Grant/DOE would not cover.

As for Nelnet being a FFELP lender, I do not know... I will read up more on what that even is when I am at work..lol.. I went through my school to choose a lender, They gave me a list and told me to pick the lender that would suit me the best.. and I chose nelnet because they had what i thought to be Pretty good interest rates....So therefore I do not know any thing about Direct or FFELP.. Hmmmm....

Im starting to feel like this is the first day of school all over again! LOLZ...
Any input is welcome.. if there is a delayed response.. its cause I will be driving to work.. *i hate mondays*.. BUT since I am addicted to this site, I will be on as soon as I am behind my desk!

I don't know if you've called US DOEd yet, but my sister had defaulted on a Federal student loan that she had and they are really working with her. They told her if she paid $100 per month (but they will work to suit your situation) for 12 months, they will delete the derogatory information and she will then qualify for a new student loan and also a economic hardship deferment if needed at that point. All she had to do was do post dated checks and they are good about staying to the date that you agreed upon. They are probably the easiest creditor to work with. Their last resort is garnishing your wages and that's only if you haven't tried to negotiate with them or haven't talked with them at all. I think you will be fine.

There is absolutely no need to do post-dated checks. THAT I would recommend against.

Your loans become due six months after you cease being a full time student.

WHat I am reading above is a default.

I understand what you are saying about post dated checks because I would never do it with a "normal" creditor, but if the only other alternative is to have your checks garnished, I would do it because they can garnish 25% of your check. I know someone where that is happening (and they take her taxes) because she doesn't have a checking account for them to take money out of or for her to post date a check. They play pretty fair. She's being doing it for almost 9 months now and will apply for a deferment shortly after her last payment post. Trust me, the government will get their money one way or another.

No one knows that better than I do. But I assure you, there is NO requirement for post dated checks. In fact, it is illegal to write a post-dated check. Did you know that? And so many of your facts are wrong ... I dunno if that's because it's not YOU this is happening to and you're conveying third hand data or what, but the truth (as Lynn has already mentioned) is that the government can NOT take 25% of a paycheck. The max is 15%, the usual is 10% from what I've seen.

I stand by my earlier statement - there is no need to do post-dated checks and I still recommend against doing it.

Actually it is NOT illegal to write a post dated check. According to the ABA (American Banking Assoiciation) post dated checks to not exist. Banks do not recognize a date as being post dated. The onus is on the CA not to present the check until the date written on the check. This is part of the FDCPA!!

Right, exactly. I'm so glad you posted this Lynn, because there's misinfo over on the credit forum today.

Specifically, in the Unfair Practices section (808):

(2) The acceptance by a debt collector from any person of a check or other payment instrument postdated by more than five days unless such person is notified in writing of the debt collector's intent to deposit such check or instrument not more than ten nor less than three business days prior to such deposit.

(3) The solicitation by a debt collector of any postdated check or other postdated payment instrument for the purpose of threatening or instituting criminal prosecution.

(4) Depositing or threatening to deposit any postdated check or other postdated payment instrument prior to the date on such check or instrument.

Do either of you realize that if someone writes a post dated check and it is presented but does not clear, it is NOT considered a bounced check and cannot be collected as such? If a post dated check is not honored, then the person who received the check cannot go after the writer of the instrument for a criminal act; it becomes a civil issue. Maybe illegal wasn't the correct verbiage, but it sure as heck ain't smart to do it. Once that instrument leaves the writer's hands, they have lost all control over it. That's not a position I'd want to be in; would you?

And red, what's being talked about here and in the credit forum is apples and oranges.

Now Im really lost..LOL.. Looks like I am in way over my head right now with you all.. but a little update. I went to the actual school today and they are willing to set up a payment plan with me for the balance that is still in thier system so that it does not go into collections.. they said they usually give students a month before releasing the debt into collections, but they will try to work with me.. Im guessing cause i stressed how badly I needed to keep this off my credit report, she believed i was sincere which i really am... So I need to go back in on Friday and speak to her about setting something up..

I also took a trip to the Financial Aid office there to see if they could offer any help and they actual gave me some good news.. or what could potentially become good news.. based on my grades and all that other good stuff I could return to school this summer on what they call a needs scholarship and they (the school) would pay all of my tuition (no books) provided I maintain a certain GPA which I have way higher and maintain a good completion.. so Yea to me! The lady said most students turn it down and opt for student loans because they cannot afford the books.. but I said I can't afford to spend the rest of my life paying another loan so ill do what I can do to pay for the books!!! LOL.. now the bad thing is I have to pay the balance owed to the school before I can register..Grrr..registration is in 2 months... Grrrr.. But I want it badly enough so Ill make it happen.

Now back to the Dept of Ed thing... the number I called is saying they have no record of my file at all??????? WHat is that about?? My SS# pulled up nothing and the only person with my name they have on file lives in GA???

Im confused.. They gave me another # to call.. but I think I'll shall rest for the evening and start fresh in the AM.

TxQuiltGirl,

Well you're right, maybe because I have not defaulted on my my student loans that I do not know the proper procedure, but my friend informed that she was informed that the only way they can stop the garnishment is if they have post dated checks (and she said it's 25%, but maybe it isn't--I don't know) for the payments, otherwise the garnishments will continue. And like I state before (and it can be case by case) my sister has not had any problems with the rehab program . She gave them 6 post dated checks when she first started the program and then gave another 6 for the remainder of the program and they come out on the 20th of the month as agreed to when she first started the program. I KNOW it's ilegal to post date a check (as I never would with anyone other normal creditor). Again, I am not getting this first hand but I think the rehab program works fine in the event that someone has the ability to pay under certain terms. If they are lying about what they can do after 12 months of on-time payments then I guess she'll have to deal with those reprucssions after the fact since they did give her the information in writing my sister can handle it accordingly.

Today I called the US Dept of Education and they were more than willling to work with me in rehabing my loan with them. I am to pay $75 a month for 12 consecutive months, then they will remove the derogatories from my CR and my loans will go back to being with Direct Loan!

I am happy! One more step to helping my report...

Good for you!! Would u mind giving me the number you got through on? The one listed on my report is not who I need to be speaking with and they have no records on me

Calling the DOE will do you no good. You do not have a Direct Loan. You have or had Nelnet which is a FFELP lender. In your case it would be like calling Wells Fargo about a Citibank loan. Completely different programs. You need to call your guarantor or the CA you are assigned to.

Actually, I took out Student loans in addition to Financial aid from the government (Grants) Since I dropped the classes the Financial Aid is reporting that I owe a balance, which is completely seperate from loans(Nelnet), these are funds that If I had completed the courses for the term which they were dispursed I would not have had to pay back. Which is why the DOE is reporting seperately from my loans (Nelnet).. In a nutshell.. Financial Aid said "Hey, Vanessa, we will give you this money as long as you complete the courses during the semester in which we are providing the funds, IF you do not complete the coursework, U OWE US".. Nelnet is reporting as paid being in good standing, The DOE is reporting as delinquent. So it is nothing like "calling Wells Fargo about a Citibank loan".. In fact (using your example).. I have an account with Wells Fargo that is being reported as 120+ days late.. and My Citibank loan is in good standing...

UPDATE...

I got in touch with them today, or rather they got in touch with me..LOLZ.. After the initial raised voices over them calling me at work (b4 I knew it was them) and them threatening to garnish my check (after stating who they were)... things actually went pretty well... The lady turned out to be really nice, and me understanding that it is thier job to try to get as much money out of me as possible, I explained my situation, and told them what would work for me (although it was not even close to what they were offering) it really was more than I could afford to do but I figured why not, Either way we set up a payment plan that would have my balance with them "paid as agreed" by mid May.. 120+ late stays..but I guess u can't win them all.. So all is well... Thank you everyone for all of ur input.. it is greatly appreciated. I would have never had the nerves to put "my terms" on the table if it weren't for this board.. Many thanks!

Congrats; let us know how it all goes!