Hello CreditBoards:
I have been contacted by West Asset Management, Inc. regarding an outstanding student loan(s).
I contacted my former college to find out what the loans were and the person told me the following:
Defaulted on:
Perkins Loan for $2,100
Sallie Mae Stafford Loan for $2,778
Total: $4,878
The form letter I received from West Asset says I owe:
Principal Bal.: $4,878.62
Interest: $5,047.72
Penalty Charges: $0
Fees and Cost: $2,481.59
Total Balance: $12,407.93
The letter says:
"This notice is from West Asset Management, Inc. The Department of Education has placed your account with this agency for collection of action. ...Call or write our office regarding your intentions to resolve this debt at:..."
On the top it says:
"Return this portion with your payment. Do not send cash Make checks payable to: U.S. Department of Education Show your Social Security Number on your check Send payment to: National Payment Center US Department of Education PO Box 4169 Greenville TX 75403-4169"
My personal situation is:
I am a stay at home mom of a pre-schooler, in the process of separating from my husband.
I can borrow some money from a family member to help me pay for this debt.
I have tried to read as much of the archives as possible to get advice on what to do.
My thoughts are:
Contact West Asset Management by telephone
Call within the last ten days of the month
Ask for name(s) of people I speak with
Request an offer for a settlement
Ask for settlement offer in writing
If the offer is good enough, be prepared to pay asap
My questions are:
How much should be prepared to pay?
I have seen postings where the settlement was the Principal, half of the interest, and "waived" all fees and penalities. Is this realistic to expect?
How do I begin to "bargain"/speak with the person on the telephone?
I would like to pay as little as reasonably possible. How can I go about doing this?
Once I would get an offer, how should I pay? Is it possible with a wire transfer?
I have not checked my credit report; is it possible that this in on it, since the loans were for 1989-90? If so, for how long will it be on the credit reports?
I have read other posters who are concerned about the fact that after a settlement has been paid, that the "issue" is possibly not resolved/done. How can I be "sure" that I will not be contacted at a later date for more money? I have not read a suitable answer to this question.
Is it correct that I shall expect to receive a 1099 tax form for any amount that Wext Assest Management has "waived" and I shall be prepared to pay taxes on it? Does this mean that I have to get a 1099 form at the post office and fill it out when I file taxes or that I will actually get a 1099 in the mail and then I will have to send it in with my taxes?
If there are any other issues I should look out for, please let me know.
If there are any tips on how to conduct the initial call, and the entire procedure, to make the process run smoothly, I would love to hear it.
I am nervous to deal with this because I have read so many stories about people being bullied and treated badly. I plan on speaking as calmly and pleasantly as possible.
Thank you very much for your time and help! Thanks for reading!
Full Version: Please help with Defaulted Perkins/Stafford SL
QUOTE(geg @ Nov 21 2007, 09:00 AM) 
Hello CreditBoards:
I have been contacted by West Asset Management, Inc. regarding an outstanding student loan(s).
I contacted my former college to find out what the loans were and the person told me the following:
Defaulted on:
Perkins Loan for $2,100
Sallie Mae Stafford Loan for $2,778
Total: $4,878
The form letter I received from West Asset says I owe:
Principal Bal.: $4,878.62
Interest: $5,047.72
Penalty Charges: $0
Fees and Cost: $2,481.59
Total Balance: $12,407.93
The letter says:
"This notice is from West Asset Management, Inc. The Department of Education has placed your account with this agency for collection of action. ...Call or write our office regarding your intentions to resolve this debt at:..."
On the top it says:
"Return this portion with your payment. Do not send cash Make checks payable to: U.S. Department of Education Show your Social Security Number on your check Send payment to: National Payment Center US Department of Education PO Box 4169 Greenville TX 75403-4169"
My personal situation is:
I am a stay at home mom of a pre-schooler, in the process of separating from my husband.
I can borrow some money from a family member to help me pay for this debt.
I have tried to read as much of the archives as possible to get advice on what to do.
My thoughts are:
Contact West Asset Management by telephone
Call within the last ten days of the month
Exactly.
Ask for name(s) of people I speak with
Request an offer for a settlement
You have to offer a settlement. They are not going to make one up without getting the facts. They will look at your income and assests and your situation. Don't expect them to go easy since you are a stay at home mom. They will ask when you are going to return to the workforce.
Ask for settlement offer in writing
Nope.... they will not respond. All negotiation should be over the phone.
If the offer is good enough, be prepared to pay asap
My questions are:
How much should be prepared to pay?
They will drop most or all of collection fees. I would not expect interest to be waived. You also are settlling on two seperate accounts so the criteria could be different.
I have seen postings where the settlement was the Principal, half of the interest, and "waived" all fees and penalities. Is this realistic to expect?
Very rare.
How do I begin to "bargain"/speak with the person on the telephone?
You are better off finding out first how much you can borrow. Settlements can end up backfiring if you offer too little...they may then expect you to put all of the offer down as down payment since you have access to it. Based on your balance, I really dont think they will go below $9k. 100% of the collection fees would be around 10k. If you can borrow 10k, offer 9k and go from there. Also you should have easy access to the funds...once you offer a settlement they want it within 7-10 days. Generally what they will do is order a "pay off balance" which will bring the interest up to date approximately 7-10 days in the future and then base the settlement off of that. (Interest is accuring on a daily basis)
I would like to pay as little as reasonably possible. How can I go about doing this?
Once I would get an offer, how should I pay? Is it possible with a wire transfer?
Wire transfers cost $30-40. Get a cashiers check and overnight it.
I have not checked my credit report; is it possible that this in on it, since the loans were for 1989-90? If so, for how long will it be on the credit reports?
I have read other posters who are concerned about the fact that after a settlement has been paid, that the "issue" is possibly not resolved/done. How can I be "sure" that I will not be contacted at a later date for more money? I have not read a suitable answer to this question.
They will fax you a settlement letter. It will have the settlement amount and the date that is good to.
Is it correct that I shall expect to receive a 1099 tax form for any amount that Wext Assest Management has "waived" and I shall be prepared to pay taxes on it? Does this mean that I have to get a 1099 form at the post office and fill it out when I file taxes or that I will actually get a 1099 in the mail and then I will have to send it in with my taxes?
Nope...you wont have to do anything. The DOE will send you the 1099.
If there are any other issues I should look out for, please let me know.
If there are any tips on how to conduct the initial call, and the entire procedure, to make the process run smoothly, I would love to hear it.
I am nervous to deal with this because I have read so many stories about people being bullied and treated badly. I plan on speaking as calmly and pleasantly as possible.
Since you are offering a settlment, I wouldnt expect any problems. They want money!
Thank you very much for your time and help! Thanks for reading!
I have been contacted by West Asset Management, Inc. regarding an outstanding student loan(s).
I contacted my former college to find out what the loans were and the person told me the following:
Defaulted on:
Perkins Loan for $2,100
Sallie Mae Stafford Loan for $2,778
Total: $4,878
The form letter I received from West Asset says I owe:
Principal Bal.: $4,878.62
Interest: $5,047.72
Penalty Charges: $0
Fees and Cost: $2,481.59
Total Balance: $12,407.93
The letter says:
"This notice is from West Asset Management, Inc. The Department of Education has placed your account with this agency for collection of action. ...Call or write our office regarding your intentions to resolve this debt at:..."
On the top it says:
"Return this portion with your payment. Do not send cash Make checks payable to: U.S. Department of Education Show your Social Security Number on your check Send payment to: National Payment Center US Department of Education PO Box 4169 Greenville TX 75403-4169"
My personal situation is:
I am a stay at home mom of a pre-schooler, in the process of separating from my husband.
I can borrow some money from a family member to help me pay for this debt.
I have tried to read as much of the archives as possible to get advice on what to do.
My thoughts are:
Contact West Asset Management by telephone
Call within the last ten days of the month
Exactly.
Ask for name(s) of people I speak with
Request an offer for a settlement
You have to offer a settlement. They are not going to make one up without getting the facts. They will look at your income and assests and your situation. Don't expect them to go easy since you are a stay at home mom. They will ask when you are going to return to the workforce.
Ask for settlement offer in writing
Nope.... they will not respond. All negotiation should be over the phone.
If the offer is good enough, be prepared to pay asap
My questions are:
How much should be prepared to pay?
They will drop most or all of collection fees. I would not expect interest to be waived. You also are settlling on two seperate accounts so the criteria could be different.
I have seen postings where the settlement was the Principal, half of the interest, and "waived" all fees and penalities. Is this realistic to expect?
Very rare.
How do I begin to "bargain"/speak with the person on the telephone?
You are better off finding out first how much you can borrow. Settlements can end up backfiring if you offer too little...they may then expect you to put all of the offer down as down payment since you have access to it. Based on your balance, I really dont think they will go below $9k. 100% of the collection fees would be around 10k. If you can borrow 10k, offer 9k and go from there. Also you should have easy access to the funds...once you offer a settlement they want it within 7-10 days. Generally what they will do is order a "pay off balance" which will bring the interest up to date approximately 7-10 days in the future and then base the settlement off of that. (Interest is accuring on a daily basis)
I would like to pay as little as reasonably possible. How can I go about doing this?
Once I would get an offer, how should I pay? Is it possible with a wire transfer?
Wire transfers cost $30-40. Get a cashiers check and overnight it.
I have not checked my credit report; is it possible that this in on it, since the loans were for 1989-90? If so, for how long will it be on the credit reports?
I have read other posters who are concerned about the fact that after a settlement has been paid, that the "issue" is possibly not resolved/done. How can I be "sure" that I will not be contacted at a later date for more money? I have not read a suitable answer to this question.
They will fax you a settlement letter. It will have the settlement amount and the date that is good to.
Is it correct that I shall expect to receive a 1099 tax form for any amount that Wext Assest Management has "waived" and I shall be prepared to pay taxes on it? Does this mean that I have to get a 1099 form at the post office and fill it out when I file taxes or that I will actually get a 1099 in the mail and then I will have to send it in with my taxes?
Nope...you wont have to do anything. The DOE will send you the 1099.
If there are any other issues I should look out for, please let me know.
If there are any tips on how to conduct the initial call, and the entire procedure, to make the process run smoothly, I would love to hear it.
I am nervous to deal with this because I have read so many stories about people being bullied and treated badly. I plan on speaking as calmly and pleasantly as possible.
Since you are offering a settlment, I wouldnt expect any problems. They want money!
Thank you very much for your time and help! Thanks for reading!
Lynn,
Thank you so much for your knowledgeable answer!
I have a few more questions:
I will offer a settlement, like you suggest. I can offer 9k.
Do you think I should not offer anything below 9k because they will refuse?
How should I respond if the person tries to get me to pay more than 9k?
I am not going back to work any time soon, so what shall I say about this? Would that be a relevant question for them to ask when I am calling to offer a settlement?
When I said, "Ask for a settlement offer in writing," I meant to negotiate the settlement over the phone, then once an agreement is reached, my question is: should I ask the person to send/email/fax me a written "offer of settlement" (or whatever it would be called) in order for me to have something in writing saying what I will pay? Then I can send them the settlement money and then once they receive that they can send me the "settlement letter" saying that the settlement was paid.
What did you mean when you wrote?:
Settlements can end up backfiring if you offer too little...they may then expect you to put all of the offer down as down payment since you have access to it.
When you say, If I can borrow 10k, offer 9k and go from there.
How will this person negotiate with me to "go" from 9k to 10k? How do I handle this?
I will have easy access to the funds, so once we reach an agreement, I can have the money sent.
Do the letter(s) always need to be sent by fax? Isn't is possible to send email attachments too?
You are very generous with you knowledge, Lynn! We are all so lucky! Thank you!
Good luck with your soap business. I hope you are getting a lot of orders for Christmas!
By the way, I could not figure out how to comment to your answer to my text the way you did it: by writing in a different color answering in the text at the end of the sentence. I looked all over the reply area and clicked on every clickable thing to see what would work. Did you just cut and paste my text into the reply field and then write your responses with a different color as you went along?
Thanks!!
Thank you so much for your knowledgeable answer!
I have a few more questions:
I will offer a settlement, like you suggest. I can offer 9k.
Do you think I should not offer anything below 9k because they will refuse?
How should I respond if the person tries to get me to pay more than 9k?
I am not going back to work any time soon, so what shall I say about this? Would that be a relevant question for them to ask when I am calling to offer a settlement?
When I said, "Ask for a settlement offer in writing," I meant to negotiate the settlement over the phone, then once an agreement is reached, my question is: should I ask the person to send/email/fax me a written "offer of settlement" (or whatever it would be called) in order for me to have something in writing saying what I will pay? Then I can send them the settlement money and then once they receive that they can send me the "settlement letter" saying that the settlement was paid.
What did you mean when you wrote?:
Settlements can end up backfiring if you offer too little...they may then expect you to put all of the offer down as down payment since you have access to it.
When you say, If I can borrow 10k, offer 9k and go from there.
How will this person negotiate with me to "go" from 9k to 10k? How do I handle this?
I will have easy access to the funds, so once we reach an agreement, I can have the money sent.
Do the letter(s) always need to be sent by fax? Isn't is possible to send email attachments too?
You are very generous with you knowledge, Lynn! We are all so lucky! Thank you!
Good luck with your soap business. I hope you are getting a lot of orders for Christmas!
By the way, I could not figure out how to comment to your answer to my text the way you did it: by writing in a different color answering in the text at the end of the sentence. I looked all over the reply area and clicked on every clickable thing to see what would work. Did you just cut and paste my text into the reply field and then write your responses with a different color as you went along?
Thanks!!
You gotta be careful geg because sometimes you will get advice that is not in your best interest but works well for collectors.
Why would you want to pay such a sum, double what you borrowed.
You are a single mom and your child is now the highest priority. You have no work and no plans to get one.
They have no power over you and this is a private loan. Nothing they can do about it.
Why would you want to pay such a sum, double what you borrowed.
You are a single mom and your child is now the highest priority. You have no work and no plans to get one.
They have no power over you and this is a private loan. Nothing they can do about it.
QUOTE(stashandcash @ Nov 27 2007, 07:24 PM)
You gotta be careful geg because sometimes you will get advice that is not in your best interest but works well for collectors.
Very true. Some people do give bad advice...
Why would you want to pay such a sum, double what you borrowed.
Maybe because it's what she now legally owes, per the terms of the promissory note she voluntarily signed when she took out the loan.
You are a single mom and your child is now the highest priority. You have no work and no plans to get one.
You don't know that. If she's in the process of separating from her husband, I suspect there's a chance she'll be re-entering the workforce at some point.
They have no power over you and this is a private loan. Nothing they can do about it.
These are NOT private loans and there's plenty they can do about it. Tax refund offsets, administrative wage garnishment should she begin working, etc.
Very true. Some people do give bad advice...
Why would you want to pay such a sum, double what you borrowed.
Maybe because it's what she now legally owes, per the terms of the promissory note she voluntarily signed when she took out the loan.
You are a single mom and your child is now the highest priority. You have no work and no plans to get one.
You don't know that. If she's in the process of separating from her husband, I suspect there's a chance she'll be re-entering the workforce at some point.
They have no power over you and this is a private loan. Nothing they can do about it.
These are NOT private loans and there's plenty they can do about it. Tax refund offsets, administrative wage garnishment should she begin working, etc.
OP, I don't know much about settlements so I don't really have any advice to offer other than to not listen to people like this who have no idea what they're talking about. Sheesh.
It sounds like you've got a solid plan and I wish you the best of luck.
QUOTE(Saria @ Nov 27 2007, 08:14 PM)
It sounds like you've got a solid plan and I wish you the best of luck.
You call it solid plan?
Off course, there are choices: get a second job, work 12 hours a day.
Look into mirror geg, and look again after couple of years because you will look 20 years older then.
I'm not saying that you are getting wrong advice but what you get is coming from people working for the financial industry.
The point I'm trying to make, don't rush into any decision. Use Google Answers for example to have a complete picture.
You could be still enjoying life by laying low and paying minimum payments.
Best to you
QUOTE(stashandcash @ Nov 27 2007, 07:40 PM)
QUOTE(Saria @ Nov 27 2007, 08:14 PM)
It sounds like you've got a solid plan and I wish you the best of luck.
You call it solid plan?
Off course, there are choices: get a second job, work 12 hours a day.
Look into mirror geg, and look again after couple of years because you will look 20 years older then.
I'm not saying that you are getting wrong advice but what you get is coming from people working for the financial industry.
The point I'm trying to make, don't rush into any decision. Use Google Answers for example to have a complete picture.
You could be still enjoying life by laying low and paying minimum payments.
Best to you
What you dont seem to understand is that when the government wants their money, they will TAKE their money. There is no waiting. Student loans are NOT credit cards...they will not wait. Laying low is the worst advise you could give. Right now she cannot get her college transcript...it is frozen and will be until she pays this off. She might need it for work. Tax offsets, wage garnishments not to mention FEMA benefits for her and her child.
Google Answers cannot give real life examples. I have worked both sides of the industry, both the collections and the giving out of loans as an FA officer. Cynic has a ton of experience as do a lot of members of this board who give REAL LIFE examples and experiences.
QUOTE(LynnInMN @ Nov 27 2007, 11:29 PM)
QUOTE(stashandcash @ Nov 27 2007, 07:40 PM)
QUOTE(Saria @ Nov 27 2007, 08:14 PM)
It sounds like you've got a solid plan and I wish you the best of luck.
You call it solid plan?
Off course, there are choices: get a second job, work 12 hours a day.
Look into mirror geg, and look again after couple of years because you will look 20 years older then.
I'm not saying that you are getting wrong advice but what you get is coming from people working for the financial industry.
The point I'm trying to make, don't rush into any decision. Use Google Answers for example to have a complete picture.
You could be still enjoying life by laying low and paying minimum payments.
Best to you
What you dont seem to understand is that when the government wants their money, they will TAKE their money. There is no waiting. Student loans are NOT credit cards...they will not wait. Laying low is the worst advise you could give. Right now she cannot get her college transcript...it is frozen and will be until she pays this off. She might need it for work. Tax offsets, wage garnishments not to mention FEMA benefits for her and her child.
Google Answers cannot give real life examples. I have worked both sides of the industry, both the collections and the giving out of loans as an FA officer. Cynic has a ton of experience as do a lot of members of this board who give REAL LIFE examples and experiences.
Hi Lynn and others,
I want to call the collection agency today since it is near the end of the month and I don't want to wait until the end of December.
Could you please give me your advice regarding the last few questions I have?:
I will offer a settlement, like you suggest. I can offer 9k, but, of course, I would like to offer less.
Do you think I should not offer anything below 9k because they will refuse?
How should I respond if the person tries to get me to pay more than 9k?
I am not going back to work any time soon, so what shall I say about this? Would that be a relevant question for them to ask when I am calling to offer a settlement?
When I said, "Ask for a settlement offer in writing," I meant to negotiate the settlement over the phone, then once an agreement is reached, my question is: should I ask the person to send/email/fax me a written "offer of settlement" (or whatever it would be called) in order for me to have something in writing saying what I will pay? Then I can send them the settlement money and then once they receive that they can send me the "settlement letter" saying that the settlement was paid.
What did you mean when you wrote?:
Settlements can end up backfiring if you offer too little...they may then expect you to put all of the offer down as down payment since you have access to it.
When you say, If I can borrow 10k, offer 9k and go from there.
How will this person negotiate with me to "go" from 9k to 10k? How do I handle this?
I will have easy access to the funds, so once we reach an agreement, I can have the money sent.
Do the letter(s) always need to be sent by fax? Isn't is possible to send email attachments too?
Thank you so much. I am happy for any and all advise I can get.
You could be still enjoying life by laying low and paying minimum payments.
Noooo.....
geg, PLEASE take Lynn's advice and do NOT lay low. Lynn has helped me in my
quest to take care of my defaulted student loan and my loan is no longer in default.
Ultimately, you will have to choose, of course. I just wanted to share my experience
and how it worked out great for me! I cannot express enough how great Lynn and
some of the other members have helped me. None of the advice I was given was to
"lay low." It won't go away!
I did not offer a settlement, I rehabilitated. This might work for you because it
sounds like you're in the same position I was in about a year and a half ago.
I agreed to pay a specific amount every month to the collection agency by requesting
a rehabilitation. My monthly payment was $150.00. I made 12 consecutive payments
(now it's 9 months), and my rehabilitation was complete.
Here's what happened when I rehabilitated:
My interest and principal remained, but my fees and costs were removed.
I no longer had to deal with the collection agency.
My tax offset was removed.
My credit report changed - it now reads, "paid as agreed/never late."
My credit score jumped up that now I can apply for credit without any problems.
I am eligible to apply for other student loans if I decide to return to school.
Total peace of mind!
It is possible that after rehabilitation your fees and penalties may be removed, so if I
were to settle, I would not offer more than $9K (principal + interest).
Good Luck!
Noooo.....
geg, PLEASE take Lynn's advice and do NOT lay low. Lynn has helped me in my
quest to take care of my defaulted student loan and my loan is no longer in default.
Ultimately, you will have to choose, of course. I just wanted to share my experience
and how it worked out great for me! I cannot express enough how great Lynn and
some of the other members have helped me. None of the advice I was given was to
"lay low." It won't go away!
I did not offer a settlement, I rehabilitated. This might work for you because it
sounds like you're in the same position I was in about a year and a half ago.
I agreed to pay a specific amount every month to the collection agency by requesting
a rehabilitation. My monthly payment was $150.00. I made 12 consecutive payments
(now it's 9 months), and my rehabilitation was complete.
Here's what happened when I rehabilitated:
My interest and principal remained, but my fees and costs were removed.
I no longer had to deal with the collection agency.
My tax offset was removed.
My credit report changed - it now reads, "paid as agreed/never late."
My credit score jumped up that now I can apply for credit without any problems.
I am eligible to apply for other student loans if I decide to return to school.
Total peace of mind!
It is possible that after rehabilitation your fees and penalties may be removed, so if I
were to settle, I would not offer more than $9K (principal + interest).
Good Luck!
QUOTE(stashandcash @ Nov 27 2007, 08:40 PM)
You call it solid plan?
Off course, there are choices: get a second job, work 12 hours a day.
Look into mirror geg, and look again after couple of years because you will look 20 years older then.
I'm not saying that you are getting wrong advice but what you get is coming from people working for the financial industry.
The point I'm trying to make, don't rush into any decision. Use Google Answers for example to have a complete picture.
You could be still enjoying life by laying low and paying minimum payments.
Best to you
Off course, there are choices: get a second job, work 12 hours a day.
Look into mirror geg, and look again after couple of years because you will look 20 years older then.
I'm not saying that you are getting wrong advice but what you get is coming from people working for the financial industry.
The point I'm trying to make, don't rush into any decision. Use Google Answers for example to have a complete picture.
You could be still enjoying life by laying low and paying minimum payments.
Best to you
ROFL. Google answers??? It was retired ages ago. Sure you don't mean Yahoo?
People that think like you have helped make many guarantors quite rich. See, people that voluntarily pay their loans just pay principle and interest. People like you, on the other hand, get to pay a greatly inflated principle that includes tons of cap'd interest, interest on the interest, and 25% per year in collection costs.
If I wanted to benefit the collectors I'd tell OP to refuse to pay so they could make more profit off her:P
Sorry, I have to be devil's advocate for a moment...
I read through OP's first post, so I just have to ask...
OP, are you fully acknowledging the debt as valid?
The reason I ask is because nowhere in your post did you indicate that you indeed DO owe this debt. Also, you said you called the school to inquire what the debt was for.
It makes me think that you either genuinely forgot about the debt, OR you didn't know about it because it does not exist! I would hate to see someone give up their money to a clerical error.
I might catch some flame for that. If you do know the debt for certain and you owe it, by all means follow Lynn's advice because she's right. However, first be certain you owe it and it's not some clerical error that is about to take food out of your child's mouth.
Again, I only say this because nowhere did you say that you actually had knowledge of the debt and its validity prior to being contacted about it MANY years after the fact. Are you sure you owe it? That's all.
I read through OP's first post, so I just have to ask...
OP, are you fully acknowledging the debt as valid?
The reason I ask is because nowhere in your post did you indicate that you indeed DO owe this debt. Also, you said you called the school to inquire what the debt was for.
It makes me think that you either genuinely forgot about the debt, OR you didn't know about it because it does not exist! I would hate to see someone give up their money to a clerical error.
I might catch some flame for that. If you do know the debt for certain and you owe it, by all means follow Lynn's advice because she's right. However, first be certain you owe it and it's not some clerical error that is about to take food out of your child's mouth.
Again, I only say this because nowhere did you say that you actually had knowledge of the debt and its validity prior to being contacted about it MANY years after the fact. Are you sure you owe it? That's all.
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