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RACE2255

Nov 25 2006, 07:46 AM

LynnInMN

Nov 25 2006, 10:35 AM

QUOTE(RACE2255 @ Nov 25 2006, 06:46 AM)

I consolidated all my loans 5/93 after graduating. Consolidated loan = $15k. I started paying $250/month. In 11/93, I received a notice saying my loan was now $23k. I immediately disputed, received no response, and stopped paying.

My situation changed, I moved over seas for a while, and I just "forgot" about it and ignored all the collection letters. I got a credit card as an aouthorized user on my mother's account, and never looked back.

I have recently returned (I have been living cash-only for YEARS, and love it!) and started working in the good ole U$A. Next year (summertime), I want to get back into real estate and will need credit again (groan). This is the ONLY bad mark on my report, but it is a whopper (or is it?). It was charged off and is now $37k.

I contacted General Revenue Corp (the collection agency) to see about paying it back, and raised the old dispute about the REAL amount. I finally received a copy of the original loan consolidation documents. They claim they are not responsible for sending me the original loan (pre-consolidation) documents, so I have everything except those. (issue #1)

I reviewed the loan consolidation documents where it lists the $15k worth of loans, but I had scribbled (it does look like my hand writing) a note on the form to the effect that I ran out of room to list them all and there may be more loans. The accompanying documentation does identify the "missing" loans, but provides no original loan documentation. So, on the surface, it does look like I may owe the whole (original) $23k.

That said, I want to pay it off so that my credit is in good shape next year; but I want to wiggle out of as much a possible before I start paying anything. (issue #2)

-- What are my options? Rehab or consolidation.

-- How can I pay as little as possible?

If you have funds available you could ask for a settlement. However student loan generally only settle off on the collection costs (18%) and maybe some of the interest

-- Should I hand it over to a lawyer to negotiate for me?

You could but quite frankly it is not a good idea. Hiring an attorney is telling the CA you have money to burn. When I used to negotiate settlements, borrowers represented by an attorney never got as big a settlement as those just calling in. For a collector, working with an attorney is a PITA.

-- Should I take it to court and try to have it dismissed on the grounds that they cannot provide the original loan documents?

The original documents are no longer party to this transaction. You consolidated into a new loan. Only the consolidation application and prom note are required. This would be no different then taking a consolidation loan from a bank to pay off credit cards. You cannot ask the bank 10 years later to provide you with one of the notes from the original credit card company.

-- Given the Higher Education Act language regarding charged off loans over 7 years old, can I get this off my report without paying anything?

If you consolidated in 1993, it was more than likely a FFELP loan. Being that it is how many years later, you more than likely have been subrogated by the DOE...the DOE would have paid off your loan to your FFELP lender and it starts another 7 year cycle. So probably not.

-- How can I get the fees and interest taken off?

Read above. And even if you settle, only the current 18% in collection fees will be waived. Your previous collection fees would have been capitalized into the loan by now.

I was the Invisible Loan Defaulter for years. After I contacted General Revenue to "voluntarily" see about paying off the debt, they started hounding me with calls, so I had to change my number and sent in a letter to shut them down. I'm the Invisible Loan Defaulter again, but would like to get this matter out of the way.

-- In the letter (sent from my letter-to-email PO Box), I withdrew any permission regarding contacting any 3rd party (as per the Fair Debt Collections Act). Does this mean they cannot contact my employer to garnish wages (assuming they find out that I am living/working in the States again)?

They don't need your permission to garnish you. Now that you have ceased them, you have basically put up a road block and they will look for employment. You have to work voluntarily with student loans...they will not negotiate by mail.

Your input to all these questions is GREATLY appreciated in advance. I realize a rehab is likely in the cards, but I want to get out of paying back as much as possible before I sign-up and start paying it.

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