Okay, here it is...
My prinicpal amt. was 35 K with Sallie Mae...paid it several years, consolidated in 2000 at 6.89%, went through several job lay-offs, had several deferments, then a Ch. 7, then a loan delinquency, which is when the loan passed from Sallie Mae to NYHESC. Hired an attorney who tried for a year (2007) to negotiate a settlement with them; they finally replied late in the year that they couldn't accept the ou offer, but countered with 45K. Before I had a chance to figure out how I could raise that much, I received a letter from them saying the loan was being moved into default staus, and that my tax return would be garnished. I then started to receive ph. calls from Pioneer, who have been pressing me mercilessly. I tried offering a higher settlement amount to them; I was informed they can't negotiate it. Together with their 22% fee (OUTRAGEOUS), the amount due is at 51K. My lawyer keeps advising me towards a Ch 13 to prevent garnishment, but I don't want to destroy my credit further (my Ch. 7 was discharged in '05).
I contacted a very nice person at FSA; she suggested I take several steps:
1) Call NYHESC and find out if they have a mediator for Pioneer Credit; I should let them know I want to make a settlement, but that Pioneer won't work with me;
2) Make the settlement offer via the NYHESC mediator, to Pioneer;
OR
If there isn't a mediator, call Pioneer directly (it was suggested I leave the attorney out of this one) and ask for a loan rehab; I would then make 9 consecutive payments, and then the rehab loan goes back to HESC, who sells the loan to another lender for continued repayment.
Does this sound accurate? If my total amt due (incl. 22% CA fee) is at 51K, how much would my monthly payment be during the rehab period? Would they still garnish my tax return during this time? What about garnishing my salary? (I was threatened with that one, too).
I appreciate any insight you could give me regarding these questions--thank you very much!
Full Version: Defaulted loan with Pioneer Credit
QUOTE(Copyguy1 @ Jan 21 2008, 06:14 PM) 
Okay, here it is...
My prinicpal amt. was 35 K with Sallie Mae...paid it several years, consolidated in 2000 at 6.89%, went through several job lay-offs, had several deferments, then a Ch. 7, then a loan delinquency, which is when the loan passed from Sallie Mae to NYHESC. Hired an attorney who tried for a year (2007) to negotiate a settlement with them; they finally replied late in the year that they couldn't accept the ou offer, but countered with 45K. Before I had a chance to figure out how I could raise that much, I received a letter from them saying the loan was being moved into default staus, and that my tax return would be garnished.
Your loan was declared in default when NYHESC paid the default claim.
I then started to receive ph. calls from Pioneer, who have been pressing me mercilessly. I tried offering a higher settlement amount to them; I was informed they can't negotiate it. Together with their 22% fee (OUTRAGEOUS), the amount due is at 51K. My lawyer keeps advising me towards a Ch 13 to prevent garnishment, but I don't want to destroy my credit further (my Ch. 7 was discharged in '05).
What type of settlement did you offer Pioneer?? Generally when in default, they are will wave some to all of collection fees.
I contacted a very nice person at FSA; she suggested I take several steps:
1) Call NYHESC and find out if they have a mediator for Pioneer Credit; I should let them know I want to make a settlement, but that Pioneer won't work with me;
Pioneer is the mediator. If you are offering too low of a settlement, they wont even discuss it. They are not going to write off principal.
2) Make the settlement offer via the NYHESC mediator, to Pioneer;
OR
If there isn't a mediator, call Pioneer directly (it was suggested I leave the attorney out of this one) and ask for a loan rehab; I would then make 9 consecutive payments, and then the rehab loan goes back to HESC, who sells the loan to another lender for continued repayment.
Your biggest mistake so far has been using an attorney. Utilizing an attorney is basically telling the CA or guarantor that you have money to waste.
Does this sound accurate? If my total amt due (incl. 22% CA fee) is at 51K, how much would my monthly payment be during the rehab period? Would they still garnish my tax return during this time? What about garnishing my salary? (I was threatened with that one, too).
1% standard payment would be a monthly rehab payment of $510. The lien is already on your 2007 so that would be seized. If you make the money agreed payments, you would not be subject to garnishment. Just so you know, they CAN garnish your wages without a court order.
Chapter 13 might stop a garnishment but it does nothing for the student loan. It all comes due again once the BK is discharged.
Collections fee pf 18-25% are mandated by federal law. They are NOT charged by the CA. Your guarantor applies them to your account at 60 days post default. The CA only gets about 8%...the rest goes to your guarantor for administrative collection costs.
I appreciate any insight you could give me regarding these questions--thank you very much!
My prinicpal amt. was 35 K with Sallie Mae...paid it several years, consolidated in 2000 at 6.89%, went through several job lay-offs, had several deferments, then a Ch. 7, then a loan delinquency, which is when the loan passed from Sallie Mae to NYHESC. Hired an attorney who tried for a year (2007) to negotiate a settlement with them; they finally replied late in the year that they couldn't accept the ou offer, but countered with 45K. Before I had a chance to figure out how I could raise that much, I received a letter from them saying the loan was being moved into default staus, and that my tax return would be garnished.
Your loan was declared in default when NYHESC paid the default claim.
I then started to receive ph. calls from Pioneer, who have been pressing me mercilessly. I tried offering a higher settlement amount to them; I was informed they can't negotiate it. Together with their 22% fee (OUTRAGEOUS), the amount due is at 51K. My lawyer keeps advising me towards a Ch 13 to prevent garnishment, but I don't want to destroy my credit further (my Ch. 7 was discharged in '05).
What type of settlement did you offer Pioneer?? Generally when in default, they are will wave some to all of collection fees.
I contacted a very nice person at FSA; she suggested I take several steps:
1) Call NYHESC and find out if they have a mediator for Pioneer Credit; I should let them know I want to make a settlement, but that Pioneer won't work with me;
Pioneer is the mediator. If you are offering too low of a settlement, they wont even discuss it. They are not going to write off principal.
2) Make the settlement offer via the NYHESC mediator, to Pioneer;
OR
If there isn't a mediator, call Pioneer directly (it was suggested I leave the attorney out of this one) and ask for a loan rehab; I would then make 9 consecutive payments, and then the rehab loan goes back to HESC, who sells the loan to another lender for continued repayment.
Your biggest mistake so far has been using an attorney. Utilizing an attorney is basically telling the CA or guarantor that you have money to waste.
Does this sound accurate? If my total amt due (incl. 22% CA fee) is at 51K, how much would my monthly payment be during the rehab period? Would they still garnish my tax return during this time? What about garnishing my salary? (I was threatened with that one, too).
1% standard payment would be a monthly rehab payment of $510. The lien is already on your 2007 so that would be seized. If you make the money agreed payments, you would not be subject to garnishment. Just so you know, they CAN garnish your wages without a court order.
Chapter 13 might stop a garnishment but it does nothing for the student loan. It all comes due again once the BK is discharged.
Collections fee pf 18-25% are mandated by federal law. They are NOT charged by the CA. Your guarantor applies them to your account at 60 days post default. The CA only gets about 8%...the rest goes to your guarantor for administrative collection costs.
I appreciate any insight you could give me regarding these questions--thank you very much!
Lynn,
Thank you for your quick response!
Just to clarify; once I've gone through the 9-month rehab @$510/month, did I receive accurate info that the rehab loan then goes back to NYHESC, and from there to another lender, at 6.89%? If that is the case, can you estimate what my monthly payments would be for the balance of the loan repayment? Is it also accurate that I will have to pay the loan back in 10 years?
Lynn, I really appreciate your insight; you've given me more info in an afternoon than I've gotten in a year from the attorney (who is also a relative; hence, his services were gratis--based on your comment that using an attorney was my "biggest mistake," I suppose I should probably mention this to the people at Pioneer, right?)
Thanks again!
Thank you for your quick response!
Just to clarify; once I've gone through the 9-month rehab @$510/month, did I receive accurate info that the rehab loan then goes back to NYHESC, and from there to another lender, at 6.89%? If that is the case, can you estimate what my monthly payments would be for the balance of the loan repayment? Is it also accurate that I will have to pay the loan back in 10 years?
Lynn, I really appreciate your insight; you've given me more info in an afternoon than I've gotten in a year from the attorney (who is also a relative; hence, his services were gratis--based on your comment that using an attorney was my "biggest mistake," I suppose I should probably mention this to the people at Pioneer, right?)
Thanks again!
QUOTE(Copyguy1 @ Jan 21 2008, 08:21 PM)
Lynn,
Thank you for your quick response!
Just to clarify; once I've gone through the 9-month rehab @$510/month, did I receive accurate info that the rehab loan then goes back to NYHESC, and from there to another lender, at 6.89%? If that is the case, can you estimate what my monthly payments would be for the balance of the loan repayment? Is it also accurate that I will have to pay the loan back in 10 years?
Your loan is still "with" NYHESC...the CA is simply working as their rep. But yes, it will be sold to another lender. My suggestion is right after your account rehabs, you consolidate again with direct loans. Much better payment options
Lynn, I really appreciate your insight; you've given me more info in an afternoon than I've gotten in a year from the attorney (who is also a relative; hence, his services were gratis--based on your comment that using an attorney was my "biggest mistake," I suppose I should probably mention this to the people at Pioneer, right?)
Still wouldnt mention an attorney. Then the CA things someone in your family has $$
Attorneys are a pain in the ass to work with cause they know diddly about student loans and the complexities. I sent more debtors to garnishment that were represented by lawyers because attornies failed to return calls, or demanded something I could not give them. We often ended up at a stalemate...of course with the guarantor winning.
Thanks again!
Thank you for your quick response!
Just to clarify; once I've gone through the 9-month rehab @$510/month, did I receive accurate info that the rehab loan then goes back to NYHESC, and from there to another lender, at 6.89%? If that is the case, can you estimate what my monthly payments would be for the balance of the loan repayment? Is it also accurate that I will have to pay the loan back in 10 years?
Your loan is still "with" NYHESC...the CA is simply working as their rep. But yes, it will be sold to another lender. My suggestion is right after your account rehabs, you consolidate again with direct loans. Much better payment options
Lynn, I really appreciate your insight; you've given me more info in an afternoon than I've gotten in a year from the attorney (who is also a relative; hence, his services were gratis--based on your comment that using an attorney was my "biggest mistake," I suppose I should probably mention this to the people at Pioneer, right?)
Still wouldnt mention an attorney. Then the CA things someone in your family has $$
Attorneys are a pain in the ass to work with cause they know diddly about student loans and the complexities. I sent more debtors to garnishment that were represented by lawyers because attornies failed to return calls, or demanded something I could not give them. We often ended up at a stalemate...of course with the guarantor winning.
Thanks again!
Okay, one more Qs (actually, 2) and I'll leave you in peace!
"Consolidate again with direct loans..."
What exactly is a "direct" loan?
Also, can they garnish my wages during the time my loan is in rehab? Can they garnish my 2008 tax return as well, if the rehab period is over by then?
"Consolidate again with direct loans..."
What exactly is a "direct" loan?
Also, can they garnish my wages during the time my loan is in rehab? Can they garnish my 2008 tax return as well, if the rehab period is over by then?
QUOTE(Copyguy1 @ Jan 21 2008, 08:46 PM)
Okay, one more Qs (actually, 2) and I'll leave you in peace!
"Consolidate again with direct loans..."
What exactly is a "direct" loan?
"Direct Loans" is the William D. Ford Federal Direct Loan Program. The funds are lent directly from the Dept of Education. As Lynn stated, their repayment options are far more favorable than other lenders. It would definitely be in your interest to look into consolidating through Direct Loans after rehab.
Also, can they garnish my wages during the time my loan is in rehab?
Once someone's wages are being garnished, they need to make voluntary payments over and above the garnishment to rehab. But if you enter into rehab first, this should prevent garnishment as long as you keep making your payments on time.
Can they garnish my 2008 tax return as well, if the rehab period is over by then?
Once you've completed rehab, you're no longer in default and they would not take your refund.
"Consolidate again with direct loans..."
What exactly is a "direct" loan?
"Direct Loans" is the William D. Ford Federal Direct Loan Program. The funds are lent directly from the Dept of Education. As Lynn stated, their repayment options are far more favorable than other lenders. It would definitely be in your interest to look into consolidating through Direct Loans after rehab.
Also, can they garnish my wages during the time my loan is in rehab?
Once someone's wages are being garnished, they need to make voluntary payments over and above the garnishment to rehab. But if you enter into rehab first, this should prevent garnishment as long as you keep making your payments on time.
Can they garnish my 2008 tax return as well, if the rehab period is over by then?
Once you've completed rehab, you're no longer in default and they would not take your refund.
Lynn,
Contrary to what you told me to expect in a rehab (1% of loan amount, or $510/month for 9 months) , Pioneer (CA) is hitting me with almost $11k in penalties and collection fees; I can choose to pay this in one sum and then pay another $534/ month (of which only $286 would be applied to my outstanding balance of $43,000; the original 6.88% rate of interest on my loan becomes a monthly rate instead of yearly during the rehab), or I could pay $1,200/month for 9 months and still owe over $1,000 in collection fees.
After the 9-month rehab, it goes back to HESC ,who then selects a new lender to to take my student loan; at this point, the lender tacks on another "one-time" fee of 18% of the total loan amount (about $8,000), bringing my loan back up to $48K, more or less. ..only after this can I apply for the Ford Program and re-consolidate the loan to get a lower monthly payment.
The term "usury" comes to mind; I don't even know how I'm ever going to pay all this. I am so sorry I ever took out a student loan.
Contrary to what you told me to expect in a rehab (1% of loan amount, or $510/month for 9 months) , Pioneer (CA) is hitting me with almost $11k in penalties and collection fees; I can choose to pay this in one sum and then pay another $534/ month (of which only $286 would be applied to my outstanding balance of $43,000; the original 6.88% rate of interest on my loan becomes a monthly rate instead of yearly during the rehab), or I could pay $1,200/month for 9 months and still owe over $1,000 in collection fees.
After the 9-month rehab, it goes back to HESC ,who then selects a new lender to to take my student loan; at this point, the lender tacks on another "one-time" fee of 18% of the total loan amount (about $8,000), bringing my loan back up to $48K, more or less. ..only after this can I apply for the Ford Program and re-consolidate the loan to get a lower monthly payment.
The term "usury" comes to mind; I don't even know how I'm ever going to pay all this. I am so sorry I ever took out a student loan.
QUOTE(Copyguy1 @ Feb 5 2008, 08:23 PM)
Lynn,
Contrary to what you told me to expect in a rehab (1% of loan amount, or $510/month for 9 months) , Pioneer (CA) is hitting me with almost $11k in penalties and collection fees;
No pioneer is NOT hitting you will penalties...they are charged by your guarantor. Collection costs are mandated by federal law.,
I can choose to pay this in one sum and then pay another $534/ month (of which only $286 would be applied to my outstanding balance of $43,000; the original 6.88% rate of interest on my loan becomes a monthly rate instead of yearly during the rehab), or I could pay $1,200/month for 9 months and still owe over $1,000 in collection fees.
You can also choose to pay !% of your balance as mandated by the Higher Education Act. They cannot make a down payment a requirement of rehab. By law you are entitlted to "reasonable and affordable'' payments. They can make up different options for you from here to the change of the next century, but the bottom line is that the Higher Education Act rules and regs apply. If they dont comply, you can file a formal complaint with the student loan ombudsman.
After the 9-month rehab, it goes back to HESC ,who then selects a new lender to to take my student loan; at this point, the lender tacks on another "one-time" fee of 18% of the total loan amount (about $8,000), bringing my loan back up to $48K, more or less. ..only after this can I apply for the Ford Program and re-consolidate the loan to get a lower monthly payment.
No other collection fees are added. Your current fees are dropped down to 18%.
The term "usury" comes to mind; I don't even know how I'm ever going to pay all this. I am so sorry I ever took out a student loan.
Usuary applies only to interet, This is a collection fee.
Contrary to what you told me to expect in a rehab (1% of loan amount, or $510/month for 9 months) , Pioneer (CA) is hitting me with almost $11k in penalties and collection fees;
No pioneer is NOT hitting you will penalties...they are charged by your guarantor. Collection costs are mandated by federal law.,
I can choose to pay this in one sum and then pay another $534/ month (of which only $286 would be applied to my outstanding balance of $43,000; the original 6.88% rate of interest on my loan becomes a monthly rate instead of yearly during the rehab), or I could pay $1,200/month for 9 months and still owe over $1,000 in collection fees.
You can also choose to pay !% of your balance as mandated by the Higher Education Act. They cannot make a down payment a requirement of rehab. By law you are entitlted to "reasonable and affordable'' payments. They can make up different options for you from here to the change of the next century, but the bottom line is that the Higher Education Act rules and regs apply. If they dont comply, you can file a formal complaint with the student loan ombudsman.
After the 9-month rehab, it goes back to HESC ,who then selects a new lender to to take my student loan; at this point, the lender tacks on another "one-time" fee of 18% of the total loan amount (about $8,000), bringing my loan back up to $48K, more or less. ..only after this can I apply for the Ford Program and re-consolidate the loan to get a lower monthly payment.
No other collection fees are added. Your current fees are dropped down to 18%.
The term "usury" comes to mind; I don't even know how I'm ever going to pay all this. I am so sorry I ever took out a student loan.
Usuary applies only to interet, This is a collection fee.
"No other collection fees are added. Your current fees are dropped down to 18%."
But according to HESC, a "one-time" handling fee of 18% of the loan amount gets added to the total loan by the new lender. Are you telling me this is inaccurate?
But according to HESC, a "one-time" handling fee of 18% of the loan amount gets added to the total loan by the new lender. Are you telling me this is inaccurate?
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