A few days ago my husband received a call from a CA called Todd, Bremer, and Lawson regarding a defaulted Perkins loan in the amount of around $5200. My husband is just a few months away from finishing his medical residency and we were really confused by this. The rest of his medical school loans have been consolidated with Sallie Mae. Apparently this Perkins Loan has been in deferment for the duration of his residency up until the last year. We are guessing this happened because we moved three years ago and any correspondence the medical school sent was not forwarded to us. With over $200K in medical school loans, a 5K Perkins loan just was not on our radar...we thought it was still in deferment.The CA has told us that we have 3 options:
1) Do nothing and they will take my husband to court and garnish his wages
2) Pay the amount in full, which they say is now around $8000?!
3) Reconsolidate the loans through them and put them back in deferment
Ok, so my husband called the medical school this morning only to be told that the student loan officer he needs to talk to about the loan will be gone all week. The CA is expecting a call back tomorrow. SOOOO, we have a few questions...
1) Do we need to handle this issue through the CA? In other words, is it likely that the medical school sold the loan to them or whatever and now the medical school won't have anything to do with it?
2)How fast will the CA move to sue my husband? Can we insist that they give us enough time to talk to the person who apparently handles student loans at the medical school?
3)How does a CA handle consolidation? I don't get that.
4) Can we ask that the Perkins loan be "released" to Sallie Mae so that my husband can reconsolidate with them since they carry his other loans?
5)This loan would have been defered had we known about it, with no interest. Can we do that retroactively since we didn't received any notification that it was due?
I appreciate any thoughts you guys have about this situation. It is very urgent that we get this matter resolved as my husband is in the process of obtaining his medical license so that he can begin fellowship in July. The medical school will not release his transcripts which are necssary for licensing until this matter is rectified.
Full Version: Help! They are threatening to sue!
Well upon a few seconds of research, they are a collection agency that specializes in student loans. There is a spot on their site that says they do consolidations. I wouldn't consolidate jack with a CA!!
Anyway, is there no one else at the school that can be contacted about this? Usually there is more than just one person floating around in a department. I would tell them it's very important and you need to speak with someone immediately.
Did you ever receive any written correspondence from the CA? Is there anything on your credit report from them (inquiry, account, etc)?
I wouldn't ignore them, but I would stay off of the phone. I'm sure you'll get others to chime in here as well.
Anyway, is there no one else at the school that can be contacted about this? Usually there is more than just one person floating around in a department. I would tell them it's very important and you need to speak with someone immediately.
Did you ever receive any written correspondence from the CA? Is there anything on your credit report from them (inquiry, account, etc)?
I wouldn't ignore them, but I would stay off of the phone. I'm sure you'll get others to chime in here as well.
QUOTE
1) Do nothing and they will take my husband to court and garnish his wages
They do not have to take him to court to garnishment. Admin wage garnishment does not require a court order.
2) Pay the amount in full, which they say is now around $8000?!
With late fees, interest and collection fees, it adds up. Rehabbing it would be a better option.
3) Reconsolidate the loans through them and put them back in deferment
You could.
1) Do we need to handle this issue through the CA? In other words, is it likely that the medical school sold the loan to them or whatever and now the medical school won't have anything to do with it?
Student loans are never sold to CA's and the school more than likely will not deal with you. They are under contract with the CA.
What appears to have happened is that you failed to notify the Perkins Loan department of a change of address. Mail forwarding is not considered notification.
2)How fast will the CA move to sue my husband? Can we insist that they give us enough time to talk to the person who apparently handles student loans at the medical school?
Again, there is no necessity to sue. They can garnish without a court order.
3)How does a CA handle consolidation? I don't get that.
CA's have been handling consolidations for years. If you read the CA's website, they refer them on to the Direct Loan program thru the DOE.
4) Can we ask that the Perkins loan be "released" to Sallie Mae so that my husband can reconsolidate with them since they carry his other loans?
You could.
5)This loan would have been defered had we known about it, with no interest. Can we do that retroactively since we didn't received any notification that it was due?
It is the students resonsiblity to maintain the deferment each year, which includes notifiying them of change of address. Failure to do so starts the clock and results in default. It cannot be retroactively undone.
They do not have to take him to court to garnishment. Admin wage garnishment does not require a court order.
2) Pay the amount in full, which they say is now around $8000?!
With late fees, interest and collection fees, it adds up. Rehabbing it would be a better option.
3) Reconsolidate the loans through them and put them back in deferment
You could.
1) Do we need to handle this issue through the CA? In other words, is it likely that the medical school sold the loan to them or whatever and now the medical school won't have anything to do with it?
Student loans are never sold to CA's and the school more than likely will not deal with you. They are under contract with the CA.
What appears to have happened is that you failed to notify the Perkins Loan department of a change of address. Mail forwarding is not considered notification.
2)How fast will the CA move to sue my husband? Can we insist that they give us enough time to talk to the person who apparently handles student loans at the medical school?
Again, there is no necessity to sue. They can garnish without a court order.
3)How does a CA handle consolidation? I don't get that.
CA's have been handling consolidations for years. If you read the CA's website, they refer them on to the Direct Loan program thru the DOE.
4) Can we ask that the Perkins loan be "released" to Sallie Mae so that my husband can reconsolidate with them since they carry his other loans?
You could.
5)This loan would have been defered had we known about it, with no interest. Can we do that retroactively since we didn't received any notification that it was due?
It is the students resonsiblity to maintain the deferment each year, which includes notifiying them of change of address. Failure to do so starts the clock and results in default. It cannot be retroactively undone.
QUOTE(cristy @ Mar 25 2008, 11:53 PM) 
Well upon a few seconds of research, they are a collection agency that specializes in student loans. There is a spot on their site that says they do consolidations. I wouldn't consolidate jack with a CA!!
Anyway, is there no one else at the school that can be contacted about this? Usually there is more than just one person floating around in a department. I would tell them it's very important and you need to speak with someone immediately.
Did you ever receive any written correspondence from the CA? Is there anything on your credit report from them (inquiry, account, etc)?
I wouldn't ignore them, but I would stay off of the phone. I'm sure you'll get others to chime in here as well.
Anyway, is there no one else at the school that can be contacted about this? Usually there is more than just one person floating around in a department. I would tell them it's very important and you need to speak with someone immediately.
Did you ever receive any written correspondence from the CA? Is there anything on your credit report from them (inquiry, account, etc)?
I wouldn't ignore them, but I would stay off of the phone. I'm sure you'll get others to chime in here as well.
Cristy....you never stay off the phone with student loan collectors. They do not respond to written correspondance and if you ignore them, they will start the garnishment process ASAP. Calling the school wont get you anywhere either.....once a student loan is assigned to a CA, the school will not deal with you.
Yes, the CA might have consolidation information on it.....but it is the federal consolidation loan program.
Student loans do not follow the same rules as other consumer debt. It is a totally different beast.
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