Pioneer Services - Student Loan

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Well, hello awesome people! I have been gone for awhile, and I'm back for some suggestions with collection advice for my Mother. She has finally paid off all of her credit cards, and now she is ready to tackle this burden of student loan debt.

She is turning 60 and retired this past summer, but she is receiving letters from Pioneer Services about PS taking action on garnishing her wages. I know she is not working, but I'm trying to think of the steps she should take.

In the past, I have only dealt with personal loans and credit cards, but never with student loans. She does live in Texas, but I don't know if the same laws apply to student loans since those deal with federal government.

Could anyone point me in a direction where I could become more knowledgeable about student loan collection in Texas? Do the debt laws still apply to federal loans? Garnishing of wages - I know the federal government could freeze her account...

Any words of guidance will be much appreciated!! Thanks!!!

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Being in Texas has no advantage whatsoever when it comes to federal student loans.

Student loans have no SOL. Social security benefits can be garnished for student loans and a student loan debt is not covered under the Social Security act. Student loans can place a lean against tax returns and recover them at 100%. They can garnish employment wages.

The best thing your mother can do here is contact the Student loan collection department herself and try and work something out. Set up a payment plan, try to get forgiveness, if she's disabled she may able to find forgiveness or an indefinite deferment that way.

Sorry to be so grim in the outlook but regardless.. I wish you good luck!

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Important issue: Since Texas is a Community Property State, was the student loan taken out before or after you were married?

If before, she can tell; the bank to pound sand because (a) she no longer has a paycheck to garnish and (B) Texas does not allow garnishments anyway. It is easy to shift all other assets to your name alone. Her Social Security and pension income is not subject to attachment even in States that allow Garnishment.

If after, the bank can come after YOU under the Community Property Laws.

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Hardship Caused by Offset of Social Security Benefits, Federal and/or State Income Tax Refunds, or Other Payments

If you claim that this withholding action is causing you and your dependents financial hardship, the Department may consider modifying or suspending withholding action. To present your claim, you must contact the Department or the guaranty agency that holds your debt, and must submit documentation satisfactory to the holder of the debt to support your claim. The Department or the guaranty agency, as its designated representative, will consider your claim and may agree to modify the withholding action. You may be required to complete a statement of financial status, which you can download at this website Common Disputes Involving Defaulted Student Loans.

Scroll down to the ssi section to download the pdf doc.

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