Thank you for your advice first off, here are the details: $24K on D loans, Allied said I was paying 5.3 I/R currently. Wanted $300/month initially, I told them I would like something more feasible and they said I qualified for a BSR Rehab program at $230/month for 12 months BUT could take an extra "month or two" in case the DOE was late in funding my new loan after rehab. They said this was "insurance" in case this happened, but that all payments would go towards the balance. What do you make or this, is this Ok?

They were nice initally then I said I wanted this in writing and the lady was a bit more stern. They can't give me any of these details in writing but that I HAVE to make a payment before the end of the month. I really want something in writing, why is this a big deal? Are they scamming me?

They also pushed HARD to get an auto draft for payment but said they would take a check but it had to be on time, everytime or I would screw up my rehab. I believe I've read before to NEVER give them access to my checking account, correct? Making payments via personal check is fine I'm guessing though?

I'm ready to get this mess straightend out, but I've heard so may horror stories about collection agencies that I'm apprehensive. How should I proceed? Also, is there ANY negotiation on the nearly 5K in fees they've tacked on?

THANK YOU SO MUCH!!
Jason

Thanks for the reply, so you don't think it's weird that they wouldn't give me anything in writing pertaining to interest rate, terms etc? Also, will the entire $230 go towards my balance or do they deduct a fee from this as well? I could have sworn I've read in here that you should NEVER give a collection agency access to your checking account regardless of whether it's for a student loan or not. Did I missread this?

Sorry if I'm apprehensive, this is a massive amount of money and will be a long road to recovery. I just don't want to get ripped off but at the same time I want to do the right thing. Texas Quilt girl, do you have an opinion on this also?

Thank you again!!
Jason

Honestly, Jason, my opinion is that you need to do some reading here because with these questions, you obviously have not.

The entire $230 will go toward your balance, but be aware at $24k a good chunk of it will go to the interest. There is no additional fee deducted from your payment.

Also, there is no reason why you can't or shouldn't give your checking account information to the CA who is dealing with this particular loan. As Lynn has already pointed out, there is very little to no chance of the CA cleaning out your bank account. These are government contracts they are working with and they are held to standards that regular CAs are not. Should they go about cleaning out bank accounts, there would be an outcry from the population with which they deal, and they would then lose the ability to service these defaulted loans. Since a good many people default on these loans and the CAs stand to make substantial fees as a result of yours and others' misfortunes, they will not risk the complaints. In other words, in this particular type of case, there is absolutely no need to bite the hand that feeds you. In fact, the CA is trying to be sure that you don't screw up and send in a late payment; should you do so, you would have to start rehab all over again and it's not pretty, frankly

Of course, there are other ways around it; you can send the payment in two weeks ahead of when it's due and call to ensure they received it and credited it to your account, or you can use your bank's bill pay ... the thing is, I used both of these methods, and I still found myself calling in every month to be sure they received it. If they are doing an auto-draft, you don't have to worry as much.

You really do need to read here about rehab and how it works, because I don't think you have, and if you do, you will be more at ease with the way these things work. Good ones to search on are ziggypop (both because she did auto-draft with the CA and there is a lesson to be learned from her experiences with consolidation), Cheech, and my own story.

If you have questions, please feel free to ask, but trust me, neither Lynn nor I would intentionally lead you wrong. Lynn and I don't always agree on the way reporting and TLs should be handled, but I warrant that we agree on 98% of what we say when it comes to setting up rehab.

Good luck, and happy reading!