Student Loan Wage Garnishment

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Each guarantor sets conditions each year as to if and how a borrower will be removed from offset. For 2008, the offset lists were submitted early December....you had to meet certain conditions ....some required a total dollar amount be paid over that calender year, others require 3 payments ....each is different. There is no set rule.

Good information Soaplady :wink:

I've known people who have Defaulted on student loans. One SPECIFIC person had a loan for $15,000.00 ( or close to that). EVERY year, at Tax time, she always got a refund. However...when the Student loan entered a 'default Mode', the IRS took her entire Refund, every year, to pay it back. She's STILL hasn't paid all of it back, yet. However...depending on whom you got the loan through, sometimes, lenders can help you bring your loan out of Default.

Tax offset is used only on defaults...you keep your loan current and out of default, seizure is a non issue. Lenders however, will not bring you out of default. You either have to rehab thru your guarantor or CA or do a consolidation. Of course this is only applicable with federal loans.

Are Rehab's possible on private student loans??

Nope....no rehabs for private loans.

Thanks! Are you familair with collection tactics for private student laons?

I wouldnt call them tactics but yes I am familiar with them .

No bankruptcy on them
Due to the default clause on the contract, the balance is due in full on demand.
Even if you are making payments, they will sue you.
Refinancing a private student loan is impossible and no rehab. These loans do not have federal protections like federal loans.
They also report like student loans....everything is based off the claim paid or default date.

I din't realize that there was that much difference between a Federal loan and a Private loan...WOW!! Sems to me, if you DO get a Student loan, probably a better idea to get a Federal one.

Yes this is very good information to know.

So I guess if you default on a private student loan, that is pretty much it. Seems most of the private loans have a ridiculous repayment plan as well :?

Federal are a lot easier to deal with than private loans. When I was working as a financial aid officer, I always advised students to take as little as possilbe with private loans....most were better off working an extra job.

The other problem with private loans is that students see the extra money they can get for 'various expenses' and borrow way more then they should.?? That was my?? problem, I totally went into it blindly and am paying for it up the nose every month.??
Then people think that they are entitled to the same options as federal student loans and get a big slap of reality when they realize they are screwed.

Anybody have resources for the state of Colorado :?:

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I live in Texas and have been having my wages garnished for about 3 years. I have never been in a rehab program or any other program. Is there something that I can do to get out of the 15% wage garnishment at this point or am I stuck having my wages garnished for the rest of time?

is it a private or federal loan?

This would have to be a federal loan as Tx is a non garnishment state for all other debts...private student loans under judgement cannot garnish.

Texas has not been doing rehab for quite awhile...they lost their lender and rehab was pretty well the only option for getting out of garnishment. You cant consolidate while being garnished either.

Do you think they will get their rehab program back?

Hard to say....a lot of the ffelp guarantors have been hit by this problem.

My wages are being garnished. I know that I have to pay my student loans back but is there any help I can get? The garnishment is hurting me! How can I get them to reduce the percentage? Please help!

Federal or private loan??

If it was a federal loan, you had the opportunity to appeal the garnish prior to it starting.

For private, they would have taken you to court and would be garnishing you at your state maximum.

About 10 years ago, my now exhusband and I combined our student loans. Unfortunately the loan is in my name only. Any way that I can make him responsible for his part?

:confused:I have student loans of 50,000 and a single mother of 2 kids. I make 10.50 an hour. Dcs called and asked lots of questions saying they need 500 in 2 days and 360 a moth or they are going to garnish my wages. What should I do?

You need to work with them or they will garnish your wages...without a court order.

You have two options....

rehab.....9 payments and your loan comes out of default. Standard payment would be around $500/month. However by law, you are entitled to "reasonable and affordable" payments based on your income and your balance...this basically means they will lower your payment but dont be looking for a $50 per month payment.

Consoldation....you will be assigned to the Income Contingent Repayment plan...your payment will be based on your income with Direct Loans. Read the sticky section.

Thank you !!

Regarding wage garnishment, how do they find out where you're employed?

They check your tax records.

So, if you're unemployed thus not filing taxes or earning wages, what do they do then?

Yup...federal loans cross reference IRS records.

The IRS took my tax refund for my student loans that I've defaulted on. It's been a VERY rough year and I'm in severe financial hardship right now. I'm a single mom now and I'm now unemployed. I was going to get $5000 back and they took it all. Is there any way to appeal this? I've never had wages garnished and I don't ever remember receiving a letter saying they were going to take my refund if I didn't pay. It's not a private loan. I'm sure I'm screwed, but I'm just praying I might have a chance to appeal?

you can try but it is not likely you will suceed. It is pretty common knowledge and is in tax documents and filing programs that the IRS will offset for defaults.

My check has been garnished for a year due to default on a parent plus loan. the IRS has also taken a tax refund (the stimulus refund a couple of years ago). I have tried, several times, to discuss payment plans with AES for the loan, but they make it virtually impossible for me to do so, asking for a sizable amount up front and then the monthly payments. Is there anything I can do to not have the IRS take my refund this year? Logically, if AES wants a big chunk of money up front and then monthly payments, I could do so with the IRS refund, and I am working 2 jobs right now, so I could handle monthly payments. Incidentally, I got into this mess due to some medical problems with high bills to pay and going through a divorce.

You had the opportunity to pay voluntarily prior to the garnishment and plus appeal the garnishment based on financial hardship. Your guarantor is under no obligation to offer you payments once you are in garnishment. Have you asked them about rehab?

Thank you for your reply. How do I ask them about rehab? I am willing to do anything to get out of this debt and not have my refund taken away.

Rehab requires 9 payments over and above the garnishment. You would have to delay filing until after the rehab is completed.

Thank you. How do I make the payments? How do I "apply" for the rehab, and how much are the payments? Are the the same as the garnishment payments? Please advise.

You need to call and talk to the CA if it is being handled by one...or the guarantor. Generally a rehab payment is 1% of your balance. You ask for it...you dont apply. Once you have made 9 voluntary on time payments, you are eligible for a rehab.

i am about to be garnished by 2 different collectors for the same loan can they do that i am struggling enough on my own already and now there threatening to garnish me and file a judgement against me to make me pay even more money that can't afford i'm afraid there going to make me homeless cause of finacial hardship is there anything i can do!!!!!!!!!! i ahte how these people can just forcefully take money away from hard working people who really can't afford it:confused:

Are these for federal or private loans? Federal loans do not require a judgment and even with private loans, guaranishments have to be coordinated thru the guarantor.

I recently found out that I have an old (1978 or so) student loan on file with the Department of Justice. I found out when I applied for a FAFSA LOAN to continue my education. I don't even remember what school I attended back then and I was surprised that I owed-all these years I thought it was a grant that I had received. I was very young and had just moved to CA-enrolled in school, got financial aid, and then ended up moving away near the end of the semester without dropping classes. Nothing has ever been on my credit report and I have never received correspondence about this matter-though I did move around a bit until about 1990. But I always worked and always paid taxes all these years (in CA) so I'm sure they could have reached me if they wanted to.

I'm wondering why nothing has ever been done and I am afraid now to contact them-it seems like all payment plans are through the Dept of Ed-the Dept of Justice sounds scary, like I will be sued or something :(

Anyone have any experience with this? This forum has such great information but I didn't see anything similar to my situation.
Thanks in advance for any of your thoughts!!
Marie

Call and find out more details. If it is with the department of justice now, it is likely you have already been sued.

Thank you-trying to getting up the nerve to call...

I have been paying a garnishment back for a while but would like to find out my remaining balance due. I have been having some difficulty finding anyone to talk to me about the original student loan and when contacting the numbers i get from the federal student loan people all i get is that my debt has been sent to outside agencies. All I want to know is how much longer i have on this garnishment before I am paid in full.

There is no one to talk to about the a"original loan"...your lender filed a default claim with you guarantor who would now be the holder of the loan. It may also have been assigned to a collection agency. You will need to contact the CA or agency garnishing your pay....if a CA has been assigned an account, they can tell you how much you owe. They will not be able to calculate how much longer you have to pay on it....you will have to figure that out by creating a spread sheet. Keep in mind you have had up to 24% in collection fees added plus your interest is accruing.

I have a student loan that is in default. I do want to work out a payment plan before wage garnishment kicks in; however the CA (DCS) has not been very accommodating to work with - they've tried to intimidate and have changed their story/approach several times.

Today, the person I spoke to told me that they would be able to garnish my wages without sending me any notice (only my employer) and that it did not matter whether I had been fired recently.

My understanding is that 1) they need to send me a notice in writing 30 days before garnishment can take effect; and 2) that if I was involuntarily terminated within the last 12 months they can't garnish my wages. Am I correct about those things?

The arrangement I want to work out with them would be that I would pay around 10% of my wages to them, starting in about 9 months. This will give me time to get my finances straight(er); since everything got really behind while I was unemployed (I've been back working for 1.5 months). Does this seem reasonable?

What percent of my wages could they garnish for student loans in CA? I had heard that it was only 10%...or at least is was that way over 10 years ago. Also, can they freeze a bank account as well?

15% of your disposable wages...it went up a few years back from 10%. Plus they will also offset your tax return.

What happens in FL if the debtor is head of household? Or NH where there is no mechanism for ongoing garnishment (new judgement must be filed every two weeks?). These questions are regarding private loans. No assets.