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donnak

Son's Student Loans Need Quick Help)

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DCS is threatening to garnish wages for my son's loans.

I need step by step instructions on the best way to get this fixed for him.

Please!!!

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Diversified Collection Services, Inc.

Mr. XYZ

Claim of: US Department of Education

Acct.# 0101010101010

Balance: $8121.58

Mr. XYZ

This letteris in response to our recent telephone conversation. We were unsuccessful in our attempt to assist you in resolving your defaulted debt owed to the US Dept. of Education.

Our firm has been authorized to use any of the following steps to resolve this matter.

*Arrange voluntary repayment terms in accordance with your financial situation

*Assist you in qualifying for programs offered to inviduals with defaulted student loans.

*Verify any entitlements that may alter the amount you owe.

*Refer your account for administrative wage garnishment procedures which may garnish up to 15% of your wages if you are employeed, in accordance with fedreal regulations.

*Submit your debt to the Department of Education for referal to the US Department of Justice for litigation if you possess other assets.

If your refusal to pay is simply due to your inability to pay the entire unpaid balance at once, we can verify your circumstances through financial statements and offer your repayment terms that will be fair to both you and the Department of Education,

If you have had past difficulty in resolving issues with a collection agency, please offer us the opportunity to assist you. If any of the following specific circumstances are applicable to you, contact us so that your concerns can be addressed immediatly.

*You can verify a total disability

*You have proof that this debt is paid in full

*You have proof that a payment has not credited your balance

*You have proof that this debt has been discharged through bankruptcy

*You want proof of the promissory note you signed

*You want itemization of the balance we are collection

*You can prove that the school closed during this loan period

*You have concerns about school's responsibility for this debt.

If you intend to avoid direct collection activity, and would like to take advantage of any of the options we are offering to resolve your defaulted account, contact your account rep 888-335-6267. This is an attempt to collect a debt by a debt collector, and any information obtained will be used for that purpose.

*******************************************************

US DEPARTMENT OF EDUCATION

Account # 01010101010101

Principal Balance $3114.74

Interest $ 200.48

Penalty charges $ 0

Fees & Costs $ 828.80

Total Balance $4144.02

THE US DEPARTMENT OF EDUCATION NOW HOLDS THE DEFAULTED STUDENT LOAN FROM THE DIRECT STUDENT LOAN PROGRAM TO ATTEND REMINGTON COLLEGE-DENVER CAMPUS FOR WHICH YOU ARE RESPONSIBLE.

THE ENTIRE OUTSTANDING BALANCE ON THIS LOAN IS NOW DUE. YOU WILL ALSO BE LIABLE FOR THE COSTS OF COLLECTING THIS LOAN. THESE CHARGES CAN ADD SUBSTANTIALLY TO THE AMOUNT NEEDED TO SATIFY YOUR DEBT.

ED WANTS YOU TO KNOW THAT PAYING YOUR DEBT BY A MUTUALLY AGREEABLE INSTALLMENT PLAN MAY MAKE YOUR LOAN ELIGGBLE FORLOAN "REHABILITATION" OF PAYOFF THROUGH A CONSOLIDATION LOAN, WHICH WILL REMOVE YOUR LOANS FROM DEFAULT STATUS, MAY IMPROVE YOUR CREDIT RATING

BLA BLA BLA BLA

***********************************************************

So now what in heck is he suppose to do. he is fixen to have to go to rehab for the next six months, so what little money he does have is going to pay attorney fees for his third DWI conviction.

I need step by step drirections on how the best way to handle this mess for him would be.

Thanks in advance. Sorry this is so long.

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well, they are offering rehab programs. But if he has other serious problems, like a 3rd DWI, I'd forget about this for awhile. If he is working, I'd make a deal, becasue they can garnish wages very, very easily. Remember, student loans are generally not deductible in bankruptcy. So it sounds like he needs to get his act together first, then worry about the student loan. If you can get him one of the loan rehab programs, or a deferral, take it, even if you have to pay for it for a while. You will be doing him a favor. Otherwise, the fees just keep mounting.

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On the wage garnishment, if that should happen, his paychecks for two weeks run about $1.46 to $3.57, so they will garnish 15% of that?

He is a waiter, so all of his money come from tips.

And today, I had him senda cease and Desist communication letter, because I THOUGHT he could deal directly with whom ever he got the loan through? Wrong move???

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If you sent a "hard" C&D, that is totally wrong.

Besides, I don't think they have to abide by it.

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alright then, so when they call again, What does he actually have to tell them? He is going into rehab in September for about six months, so he will not be able to pay anything until after then, AFTER he gets caught up with all the fines ect.........

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If he is going into rehab to cure his alcoholism, have his doctor give him a letter outlining the fact and saying he is disabled amd cannot work. So he then can apply for relief from payments because of the disability. Otherwise, forget about it unless you want to make the payments for him to keep his credit in some kind of shape. I'm not trying to be flippant. Student loans are like lamprey eels: once they latch on they don't let go. His best bet is claiming a disability that keeps him from working.

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He does not as of yet have any kind of DR. this is all through the Probation Department and the County Attorney's Office.

These are the offers being made to him, we have yet to recieve anything on the DWI charge, that is just for driving with a supended license.

So I guess I'll just leave it alone for now, as his credit is already wasted due to lack of responsibility.

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Whatever you do, do not cease them. Have him call and talk to the manager of the AWG unit. Based on his income, he probably does not earn enough to be garnished. Keep the lines of communication open. He should set up a repayment based on reasonable and affordable payments.

I would recommend that you get him to consolidate his defaulted loan thru the http://www.ed.gov/offices/OSFAP/DCS/consolidation.html .

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We already Ceased them.................Now what????

And why are the balances different from the two companys??

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The balances are probably different because he has more than one loan. Each semester or quarter he attended will result in a new loan.

In my former life, I worked as an AWG manager for a brief period of time. (Too much paperwork and didnt pay as well as being a collector!) A cease is invitation to start the garnishment, since there is no longer an open line of comunication. He does not have a permanent disability so that defence does not work. Is he part time or full time as a waiter?? They will look at hours worked at the type of restaurant and try to figure out what his tip base is. If they cannot garnish him now, they will hang on to the order pending new employment and once he has been employed 90 days, the order will go into effect. My recommendation is still to consolidate and then opt for the income contingent repayment plan which is based on his disposable income. He has no income, his payment is zero. Have him contact the agency, recind the cease (which they have to abide by) and start making small payments while working on the consolidation at the same time.

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Okay another question...............

Two different balances right, one from US Department of Education& one from a Collection Agency.

This was a Trade School and he did not finish the course, actually only attended maybe three months, I'll have to check on that though, I know it was not very long.

Does that matter?

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Okay another question...............

This was a Trade School and he did not finish the course, actually only attended maybe three months, I'll have to check on that though, I know it was not very long.

Does that matter?

Nope. Generally if these are for profit schools they are expensive, hence the need for multiple loans. (Probably took out a GSL and SLS.) Each one of these schools have student handbooks with all the policies spelled out. The biggy is withdrawal, withdrawal dates and refund policies. They are usually pretty tight. In most schools, refunds are prorated ...50% refund after 1 week, 25% after 2 weeks and nothing after 3. Miss these dates and you are SOL. If he attended 3 months he definately would be responsible for the entire tuition balance. As with schools, they have the same fixed operating costs where there is 30 students in the class or 10...teacher has to be paid, rent, insurance and utilities. That is the main reason the refund policies are so strict. He cannot use the reason that he did not finish a course as that generally is a personal decsion. HOWEVER, if he was not qualified to attend the school, that is grounds. One example I clearly remember was someone with extremely limited vision (almost blind) being signed up for truck drivers school. Or the obviously mentally impaired being signed up for a trade school...that was another interesting case. The student in question was a fairly high functioning but still mentally handicapped...and obviously so. I was contacted by his father who held POA....the student literally was missing half of his brain and sent in an x ray to prove it. So if you son had his GED or high school diploma and was "capable" of finishing the program, he would be held fully accountable.

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