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Question on Loan Default/Collection Agency


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Hi Everyone-

Here is my crazy story- Got a private student loan with my mom as a co-signer a few years ago; was supposed to start paying it, but I didnt, now the loan went on default; AES had it but now it was given to MRS Collection Agency; which are calling my mom, myself and even cousins and uncles which I feel is completely out of line; can they be doing this?

I am now at the point where I want to start paying this off; but the problem is that I don't know if there is anyway I can do a rehab program now since its in the collection agency. I called AES and they said now I have to deal with the CA (Collection Agency); but I have read many places that its possible sometimes to get the loan back to AES?

Here is another question; since they are calling everyone like crazy, I am planning to call them monday and tell them that I just sent [will send it Monday] a Debt Validation Letter; in which I ask for certain documents. Can they still be calling since I will be sending that letter? This will be the first time I am going to be sending such letter; but I am kind of scared they will say something because they are usually pretty aggressive and mean,they sometimes don't let me talk..

I feel so bad for all this and I regret this every minute of my life, but I guess I just have to learn from my mistakes... Is there anything else you guys can advice me?

I am still in school, finishing up a nursing school, so I dont have much money; once I told them I could only give so much; they told me aggressively again to talk to my mom [cosigner] and give them more money...

What do I do?

Thanks in advance,


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I find it funny that the federal government gave the private student loan industry all of the goodies such as exemption from BK but does not require them to do deferrals and such. I think that they are not telling you all of your options and I bet if you made a strong request for an in-school deferral, they would have to provide one. That should at least get them off of your and your mother's back until you finish school.

If you are in the 30 day window for DV, you can send a request for a DV and they must stop. However, the threshold for DV is quite a bit lower than the documents you are requesting.

As for the 3rd party contacts (uncles and cousins), if they said anything other than a request for contact information for you or your mother to them regarding the debt and the 3rd party contacts are willing to testify to that, you could have them for a FDCPA violation already.

My suggestion would be to request a deferral, threaten FDCPA if they did violate, and in the worse case scenario, threaten to contact your congress critter (student loans are in the political forefront right now).

As far as them not letting you get in a word edgewise, wait for them to finish. When they stop talking, ask them if they are done. If they say yes, then say what you have to say and warn them that if the interrupt, they will meet a dial tone and you will not talk to them again for 2 weeks. If they do interrupt, follow through. You can take control of the conversation.

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I agree with WhoCares1000's points about trying to get a deferral while you are still in school, the potential FDCPA violations, and "taking control of the conversation."

But with regards to the last point, I would handle it differently. Personally, I wouldn't bother with the FDCPA violations directly. My efforts to "take control" would be like this:

- Based on their tactics and behavior, I wouldn't want to deal with the CA anymore. I would send them a letter saying that they are to Cease Communication per the FDCPA. This should stop all calls to your relatives. Add that it's because of their behavior and FDCPA violations, and that you will work with the Original Creditor to resolve this.

- Then you do just that: contact the OC. If they tell you to contact MRS, you tell them that MRS is barred by law to contact you again because of your letter, and that because of their actions and FDCPA violations you refuse to deal with them.

Good luck.


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... you tell them that MRS is barred by law to contact you again because of your letter, and that because of their actions and FDCPA violations you refuse to deal with them.

And to expect the account to be on its way back to them from MRS.

And if they place the account with another collector, this will be repeated.

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Just keep in mind that student loans are second only to the IRS in their ability to make your life a living hell.

If you are still in school at least half time then I am fairly certain that by law, they MUST give you an in-school deferment (although your school will have to provide the info that you are in school).

Yes, they can all your mother (in fact they should) because she is 100% liable on the loan. As to the others, they ask for "references" on these loans so they can call them and find you. However, "finding" you is all they should be calling them about.

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