Garnishment removal options/questions

Is this a student loan?? Sounds like a rehab program.....

Yes, there are actually 3 student loans that are defaulted and are now being garnished. And 1 student loan that is currently in deferment.

Ok...so what they are proposing is a rehabilitation. It requires 9 months (not a year) of on time payments. (Sometimes you have to make a 10th payment) The loan is basically brought current and taken out of default. Once the rehab is completed, you can then consolidate all your loans together.

Another good reason to rehab starting now...getting your tax return back. This is the time of year they are getting ready to submit the tax offset list to the IRS. Get into voluntary repayment, and you get your taxes back. (Check with the CA for the exact requirements for your guarantor.)

The garnishment of $300 a month, plus the $200 rehab payment is a bit steep. That's $500 a month, I really can't afford, even if I wanted to. Is that the only option? Is there any way to pay less while the garnishment is still active, as an act of faith? Is there anything I should shoot for or suggest if I were to initiate a payment plan with them?

Unfortunately, once you are being garnished, you are stuck with the 1% payment, over and above your garnishment. You could have rehabbed prior to be being garnished for that 1% payment.

By using a student loan calculator, you will be stuck with 6.5 more years of garnishment. If there is anyway to suck it up and do the rehab, it would be in your best financial interest. Your payments will drop significantly plus you have the opportunity to go income based or income contingent....but you gotta complete the rehab.

What do you mean in that last paragraph, when you say 6.5 more years of garnishment? Is there a maximum time in which they can garnish before it's dropped?

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I see, i see. Thank you.