I hope someone here could offer their assistance. I just defaulted on my student loan. I did try to contact the lender for some reasonable help but they denied me. They said that I was way past 270 days and that I had to pay about 4 months worth (I think) to catch up in order to be considered for forebearance. Needless to say, I couldn't pay it because my husband went on disability and then eventually lost his job while on disability leave. So my loans went into default and I received notice from Ed Fund. Oh, I should add that I held my loan from Wells Fargo and they told me to contact EdFund before it went into default. I did contact EdFund and they told me to work with Wells Fargo.

Now my loans are in default. Its been 30 days and I tried to negotiate something with EdFund. They gave me 3 options which I can't do. I am the only one earning money while my husband is fighting to get unemployment. I practically make nothing. We have 2 kids (young) and another on the way. In a month, I will be on disability myself for maternity leave. I got another notice from EdFund to call them to set up some payment schedule within reason and that's affordable for me. And the same time, I got a wage garnishment notice. It was a letter stating that they could garnish my wages. Well, I called them again and told them that there's no way, I could pay what they wanted. They wanted a large initial payment which was more than what I make a year and the monthly payments would be about 1/3 of my take home pay per month. The woman who I talked to would only offer me that and told me at one point to contact my parents and see if they can give me the money or get a private loan for me. I said that wasn't an option and she said, she'd call them for me and ask. She even stated their names and said, "oh dont' worry, we have all that information about you". When she wanted to know what my bills were monthly, she made the comment that I pay too much for car insurance. Funny thing, I pay a lot less than other people I know. She kept throwing out the payroll office address for the place I work and said that I have a garnishment in the workings. But looking at the letter and reading so much about defaults, I dont' think I should be at this point considering I just went into default. She said her supervisor said that I would not be a good candidate for wage garnishment (whatever that meant) but that they would rather pursue garnishment than set up a payment plan equal to or close to what they would get with the garnishment. With the garnishment she stated at least allowed a definite payment.

What are my options here? I can afford about $200 and that's pushing it while they would get about $300 in wage garnishment per month. I want to consolidate and that's why I want to voluntarily offer that payment. I can prove without a doubt that I am in serious financial distress but she didn't care. I have thought about contacting the ombudsman.

Definately contact the Ombudsman. They are refusing a $200 payment 30 days post default?? That is nuts! How much do you owe?? You might qualify for rehab!!

I owe close to $50k for loans from undergrad and graduate school. My husband has been interviewing for jobs as well and I know once he starts getting a salary, I could offer more but not until we are back to a 2 income family.

hang in there and don't worry too much. contact the ombudsman immediately!!! they will help you with the wage garnishment. i had to use this a while back. i couldn't work out reasonable payments with the collection agency and they were threatening garnishment. the ombudsman took over and things went smoothly. i was able to get a temporary financial hardship deferral that stopped the wage garnishment. they pulled my loans from the collection agency and the US Dep Ed handles the situation directly now. we've worked at some modified payment plans.

the best advice that i received along the way was to pay whatever i could each month even with out a payment plan. if you're paying something, then they can't claim a refusal to pay. that weakens their collection attempts.

The OP's loan is a FFELP loan, and it not with the DOE. Ed Fund is the guarantor!

Just a bit of clarification. Should I just go ahead and send in a payment so they are forced to work with me or so I can show that I have not refused to pay at least something per month. AND I should also contact the Ombudsman.

Contact the ombudsman first!