Student loans in default and they are wanting far more than I can pay.?

Question

My student loan debt is large and I would really like to begin paying it back. They are wanting me to pay around 300.00 a month which is WAY more than I can afford. I do not work or own property so they can't get me that way. I am a stay at home mom and I would like to be able to get my loans back to go to grad school.
Could I make good faith payments in a smaller amount each month, then would that qualify me to get out of default? Even if it is far less than the amount they want? Does anyone have any knowledge or experience with this?

I have tried working it out with the lender! Please someone with knowledge or experience answer this question.

Answer 1

I had this same exact problem too. I am a stay at home mom of 3 kids and my payments on my student loans were around $250.00 a month and I could not afford that much. I don't have much good advice, but I will give you my experience. I don't know who you have your loans through, but mine were through American Education Services (AES). Those people were absolutely terrible to work with. They would not work with me to lower my monthly payment to something that I could afford at all. They would not budge at all from the $250.00/ month. They were so mean and rude everytime that I called. I was trying to work with them so I would not default. In the end, after over a year of back and forth arguing with them, they ended up putting my loan in default status. Don't think that they can't "get you" because you do not work. Once I was in the default status they seized the entire lump sum of what I owed them out of my husband and mine's 2006 tax return. Which made my husband furious, because I did not work at all that year, so none of the reported income on the return was mine. The loan was in even in my name (maiden name, even) and I had gotten the loan when I was single and they still had the right to take the money from our return even though none of that money was technically mine, it was all my husband's. So, just a word of warning to you, if your loan is officially in "default", they can and will take the money from your next tax return (as long as your name is on the return). If they don't get all the money that time, then they will take the rest out of your next tax return, and so on until the debt is satisfied. This has absolutely destroyed my credit, because it gets listed on your credit as a "Government Claim", which is really bad. So, I guess all I can say is try calling them and plead with them to lower your payment to something more reasonible, explain your situation, and hopefully you can get them to work with you. I did not find that to be the case with AES, they were like pay the $250.00 or else, they were entirely unwilling to work with me at all. Even if you can't get them to agree to a lower amount, try sending them whatever you can afford to send each month. I'm not 100% sure about this, but I think as long as you are making some kind of payment, I don't think they can default you or report you to a credit reporting agency, even if you are not making the full payment. The worst thing you can do is not send anything at all. These student loan things can get so messy and they are very hard to fix once things get too bad. The only other thing that I can suggest is maybe looking into one of those places that refinances students loans at a lower rate, so that you could better afford the payment. I have no personal experience with doing this, but I have heard of people doing that before and I have seen ads on tv for places that do this. Good luck to you, I hope you can get everything worked out!!

Answer 2

you will need to work this out with the lender. if you are in default, you will not be getting any more loans to go back to school