i'm a long time lurker and first time poster. I've been doing searches through the topics to find any information about the role collection agencies play in collecting on defaulted loans. Regarding am I supposed to be making payments to them....or do I continue doing what i'm doing and make payments to the government. Are my payments to the gov't even counting in getting my loans out of default.

I have a DOE loan that i've entered into a rehabilitation program (actually....this is my first month), i've already made my first payment and i've received a call from a collection agency (Van Ru in Skokie, IL). I haven't returned the call because I'm making payment through the Federal government....however I'm just confused. If i'm making payments through the Federal Gov't program....would i still have to answer to the collection agencies too.

I'm new to this and have gotten myself in a heck of a pickle...so i will be asking tons and tons of questions about SL stuff and general credit-related things, because i'm now in a slightly better position to pay off debts that i incurred when i was in college....as well as i'm fighting an uphill battle to get things removed from my credit that was put on there due to identity theft.

I just don't know where to start....and am on the verge of just giving up

thank you so much for responding Lynn

Yes, I set up a rehabilitation plan through the DOE Collection service....I get a statement every month from DOE and I've recently enrolled in the Automated Debit Program where they debit my account every 2 weeks....because I don't even want to have to remember to mail something in.

So, I should call them back and inform them that I entered the program and i'm set up with automated debit and DOE gets their money that way, or should I get out of the Automated Debit Program and just send my money to the collection agency.

I'm confused because I don't want to end up making double payments or end up paying the wrong entity. I'm also just frustrated because I'm thinking that i'm doing the right thing by trying to get out of rehab and dealing with the DOE, because I submitted all the financial infor and etc. to them and they set me up on this plan.

[quote name='LynnInMN' date='Sep 24 2006, 09:49 AM' post='1803631']

You do need to contact the CA. Once an account is outsourced you must communicate with them. If you formally entered into the rehab program with a DOE collector and the payment has posted, they should honor it. Even when dealing with a CA, all of your payments are actually sent to the same DOE address.

I'm new to this and have gotten myself in a heck of a pickle...so i will be asking tons and tons of questions about SL stuff and general credit-related things, because i'm now in a slightly better position to pay off debts that i incurred when i was in college....as well as i'm fighting an uphill battle to get things removed from my credit that was put on there due to identity theft.

I just don't know where to start....and am on the verge of just giving up
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I took your advice and contacted the CA a few minutes ago and explained to them that i just made my payment and talked to someone about entering the program and told them the amount that i'm paying, and of course they said according to their guidelines it's not an acceptible payment. I can't afford to pay the acceptible payment and i want to get my loan back on the right track, but i feel like i'm past the point of no return.

I made the payment Friday to DOE and i'm just trying to figure out whether i'd be dealing with the collection agency or dealing with DOE directly....and they are sending statements to the house on DOE letterhead. He said either way...DOE gets paid, so my thing is....why deal with the collection agency when i'm able to deal with the source. I guess i'm just borderline hysterical because I can't afford to pay between 445.78 to 681.79 per month, the $250 agreed upon based on my income is what i can afford. I mean I got myself into this....so I have to deal.

Who did you speak with to set up the payments you're currently making? And how did you reach an agreement with them?

I don't recall the person's name (i want to say his name was John or Jeremy)....however i contacted the DOE to rehab my student loans and they stated a payment amount that was something I just really couldn't afford....so they said I could show proof of expenses and income and suggest an amount that would be easier for me to establish.

DOE sent me a form that i had to fill out showing my monthly take home income (show 2 paystubs) and my expenses (show a copy of my lease, stating how much i pay in rent, proof of any other expenses i have...including child care expenses, car notes...and so on and so forth). They came to a conclusion based upon the information that I provided that I could pay another rate. I had to make 9 out of 10 on-time payments (i think they have a 15 day grace period) to continue with the program....if i don't do that, the guidelines of the rehabilitation was void.

DOE sends me a monthly statement and it states that my bill is due on September 25, and it's for $250, it shows nothing as past due or anything like that....it shows the "good faith" payment of $250 I made as well.

I would call the DOE back and tell them that you are being told by Van Rue that there is no payment plan they're aware of and that they are wanting more money from you. If you've already had agreement from the DOE, then I don't think the CA can intervene.