Rehab question! Why is the collection fee so much?

[nikkii]

So, I finally got GC Services to agree to rehab my student loans that were in default for a few years, they sent me the paper work to return and its says the collection cost are 18.5% which is $1,045 added to my Principal Balance. Is this normal? I'm not sure if I should be signing it?

 

Any advice would be appreciated!

 

Thanks!

[LynnInMN]

Collection costs for federal student loans are federally mandated. You really do not have a choice in paying them.

[nikkii]

thanks for the quick response! I will fax the papers out! I think I may be able to get this loan forgiven its 20 years old. Is that even possible?

[hodap2001]

Of course its possible so long as you met the discharge program requirements and you follow it to a 'T'

[lukegotswag]

If im not mistaken, and someone can correct me if im wrong.. but when i was agreeing to my Rehab, they stated that if the Rehab is completed, the collection fees go away, however, if I do not successfully complete the Rehab, the collection fees are still deemed to be paid..