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$64k question...when to get an attorney for student loans?

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Posted (edited)

I don't have complicated needs--just need to know what to do about getting these out of default. But I'm literally afraid to deal with the servicer (DEBT MANAGEMENT AND COLLECTIONS SYSTEM?).

I have read the private loans threads here (even one inexplicably accusing people of being biased against "woman debtors" lol...where's my pink hat..) so I hope I'm not repeating a question. I have already learned a lot from being here these last few days, and don't want to be that person who wants spoon feeding.

 

So:

I originally borrowed $29,151 between 1999-2001. My balance is now $94,714. That's why it's the $64,000 question.

 

I acknowledge I signed a contract, and am responsible for assessing whether it's fair or unfair.

 

I want to buy a home next year and planned to get an FHA loan, so I know I need to do something with these. My Federal tax return was offset this year, so it's on the radar. Clearly I'm lost here and have a history of making VERY bad decisions, but I need to make sense of this now. Or maybe I just don't count on an FHA loan...?

 

I was talked in to consolidating several times...I didn't understand...I believe that's how the balance got so high because currently the interest shown on the total balance is $12,207. I think interest on multiple loans was turned into principle along the way. Special place in hell...?

I'm afraid even to contact them because I don't want to upset any SOL which may be working for me or get talked into some terrible deal again. All I need to know is what I need to do to get these out of default WITHOUT making my situation worse, as usually happens when I talk to ANYONE from a SL servicing company. And yes, making payments is an option IF it's the smart thing to do. If it's not, well....

 

Here's what I know:

1) According to https://studentaid.gov/aid-summary/loan-details, I have two loans of type "Direct Consolidation Unsubsidized" in amounts of $54,890 and $39,829. I guess these would then be Federal Loans. I have consolidated loans a few times but I clearly didn't understand what I was doing. All I know is the payment was never affordable and it just got worse and worse.

 

2) My 3-in-1 credit report states that I have two loans from US Department of Edu in the amounts of $39,829 and $54,889 so...ok that matches up. But there is a 3rd from Dept of ED/Navient(CLOSED) showing a balance of $76, 923. I don't know what this is, or whether it's a legitimate record on my report. I'm still waiting for my paper copies to arrive. This record says it was opened 8/2016, but that makes no sense as I graduated in 2004. On the student aid website the only Navient loan shown had an original balance around $36000 and was paid to zero by consolidation around the same time...? It's totally unclear.

 

3) The last thing I did with any loan is rehabilitate one around 2016. That COULD be what the Navient record is on my report, but the amount doesn't add up. I assume that would wake up the SOL, though and make it a vaild entry and at least account for it...if the balance was correct. Anyway, my mom died suddenly and my brother was ill, so I moved around and became busy with that and have no memory of what the next step was going to be. Either way, I never took it. Before that I hadn't touched anything since they screamed at me that I was a loser who doesn't pay bills somewhere around 2009. 

 

4) I had private loans at some point. Through Sallie Mae. I don't know where they went. SOL and the reporting period has passed? But they don't show on the studentaid website. Maybe that's what I consolidated, and I think what Navient is...? I didn't understand  the point of consolidating loans except make the interest rate a fixed rate.

 

5) I did find my account on https://myeddebt.ed.gov/. Under Repayment Plans, there is none. So I'm not involved in a repayment plan for this loan at this time.

 

Does this look simple to anyone who has more experience than I have, or does it warrant finding an attorney? Not understanding things has already cost me $64k.........

 

Thanks--I can tell there is sometimes professional advice given freely here, albeit general and not to be considered professional or legal counsel. But I appreciate your time.

Edited by L99

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I can't answer your SL questions, but please adjust your W-4 to lower the amount of the potential 2020 tax year offset and provide you with more of your money through-out the year.

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12 minutes ago, hegemony said:

I can't answer your SL questions, but please adjust your W-4 to lower the amount of the potential 2020 tax year offset and provide you with more of your money through-out the year.

Good advice, thanks.

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First, you should request a Student Loan Tax refund hardship (this should be especially easy with coronavirus happening). I did this for my husband 3 years ago and the process took about 7 weeks. They just sent me a check for the amount that was applied. Then you should consolidate all of your student loans through the student aid site and just start making payments. It wasn’t free money when you got it and needs to be paid. This will initially boost your credit score because all of the previous loans will show as “paid off”. 

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1 hour ago, Nolanis87 said:

First, you should request a Student Loan Tax refund hardship (this should be especially easy with coronavirus happening). I did this for my husband 3 years ago and the process took about 7 weeks. They just sent me a check for the amount that was applied. Then you should consolidate all of your student loans through the student aid site and just start making payments. It wasn’t free money when you got it and needs to be paid. This will initially boost your credit score because all of the previous loans will show as “paid off”. 

Thanks. The CARES Act hardship off-set suspension only applies for offsets applied before March 15th, so I am not eligible to have it returned.

As I said, I'm aware I signed a contract and that it's not "free money." I have an issue with the tactics they employed over the years knowing they were dealing with a desperate young person who didn't understand, but I acknowledge that that's my problem now. I'm just trying to avoid further of the same.

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I can’t post a link here but bypassing the cares act, you can still apply for it to be returned due to financial hardship. You have to get out of default status (this will apply once you consolidate with the gov) and then There’s a form for you to fill out. I did this 3 years ago, before all the cares act, so all you have to do is say that it’s causing you financial hardship. 

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1 hour ago, Nolanis87 said:

I can’t post a link here but bypassing the cares act, you can still apply for it to be returned due to financial hardship. You have to get out of default status (this will apply once you consolidate with the gov) and then There’s a form for you to fill out. I did this 3 years ago, before all the cares act, so all you have to do is say that it’s causing you financial hardship. 

Oh, OK thanks. I didn't realize that. I don't mind it going toward paying the debt, actually. I earn a comfortable income and am not experiencing a financial hardship or emergency. I just don't want to be taken advantage of again. I suppose my reason for mentioning the offset was to make clear that this is on the radar so I have to figure it out if I want to get a FHA loan.

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