wage garn/student loan/chapter 7

[vesudeva]

About 3 weeks ago the trustee declared my no assets for chpt 7. I noticed a few weeks ago that my wages were no longer being garnished for the student loans. Does anyone know how long this will last? After the temp stay is over, will they continue to garnish or can a make a deal?
thanks

[blankslate]

Unfortunately, they WILL go back to garnishing once the automatic stay is up. You should utilize this time to work something out. If you search student loans on this forum, Dingdong has given some very good information about a program that will allow you to make very small payments. Otherwise if you talk to the CA that is now handling your loans, the only negotiation they will offer you is to take off penalties and you would have to pay the entire principal balance all at once. Or they say you can make payments on top of your garnishment for one year and then they'll work with you. Yea, I don't know anyone who could do that... But do the search for Dingdong's advice.

[vesudeva]

thanks for great advice

will research those posts as suggested.

[blankslate]

Here I did a cut and paste - this is from Dingdong

What kind of school dd you attend and what kind of loans do you have exactly?

There is a progam where you can consolidate student loans and go on an income contingent plan, however there are some criteria loan wise which you must qualify for.


The program is called the William Ford Direct loan program.


Here is some info and the link.



1. What are the benefits of a Direct Consolidation Loan?

Direct Consolidation Loans allow borrowers to combine one or more of their Federal education loans into a new loan that offers several advantages.

One Lender and One Monthly Payment
With only one lender and one monthly bill, it is easier than ever for borrowers to manage their debt. Borrowers have only one lender, the U.S. Department of Education, for all loans included in a Direct Consolidation Loan.

Flexible Repayment Options
Borrowers can choose from four different plans to repay their Direct Consolidation Loan, including an Income Contingent Repayment Plan. These plans are designed to be flexible to meet the different and changing needs of borrowers. With a Direct Consolidation Loan, borrowers can switch repayment plans at anytime.

No Minimum or Maximum Loan Amounts or Fees
There is no minimum amount required to qualify for a Direct Consolidation Loan! In addition, consolidation is free.

Varied Deferment Options
Borrowers with Direct Consolidation Loans may qualify for renewed deferment benefits. If borrowers have exhausted the deferment options on their current Federal education loans, a Direct Consolidation Loan may renew many of those deferment options. In addition, borrowers may be eligible for additional deferment options if they have an outstanding balance on a FFEL Program loan made before July 1, 1993, when they obtain their first Direct Loan.

Reduced Monthly Payments
A Direct Consolidation Loan may ease the strain on a borrower's budget by lowering the borrower's overall monthly payment. The minimum monthly payment on a Direct Consolidation Loan may be lower than the combined payments charged on a borrower's Federal education loans.

Retention of Subsidy Benefits
There are two (2) possible portions to a Direct Consolidation Loan: Subsidized and Unsubsidized. Borrowers retain their subsidy benefits on loans that are consolidated into the subsidized portion of a Direct Consolidation Loan.



2. What are the differences between FFEL Consolidation vs. Direct Consolidation?

Borrowers are encouraged to check with their existing loan holders or servicers to find out about consolidation options available to them. Some differences between programs may include:


Minimum balances or numbers of loans required to apply.
Types of loans that can be consolidated.
A prior account relationship may be required.
Repayment incentive benefits to encourage good repayment behavior.
The convenience of electronic debit, ensuring that monthly payments are made on time.
Repayment plans offered, such as payments sensitive to a borrower's income, family size, and total education indebtedness.



3. Who is eligible for a Direct Consolidation Loan?

To qualify for Direct Consolidation Loans, borrowers must have at least one Direct Loan or Federal Family Education Loan (FFEL) that is in grace, repayment, deferment, or default status. Loans that are in an in-school status cannot be included in a Direct Consolidation Loan.

Borrowers can consolidate most defaulted education loans, if they make satisfactory repayment arrangements with their current loan holder(s) or agree to repay their new Direct Consolidation Loan under the Income Contingent Repayment Plan.

Borrowers who do not have Direct Loans may be eligible for a Direct Consolidation Loan if they include at least one FFEL Loan and have been unable to obtain a Federal Consolidation Loan with a FFEL consolidation lender or have been unable to obtain a Federal Consolidation Loan with income-sensitive repayment terms acceptable to them or intend to apply for loan forgiveness under the Public Service Loan Forgiveness Program..

Borrowers who have only a Direct Consolidation Loan cannot consolidate again unless they include an additional loan.

NOTE: The Direct Loan Servicing Center has information on the Public Service Loan Forgiveness Program.



4. Can I obtain a Direct Consolidation Loan if I don't have any Direct Loans?

Yes, borrowers without any Direct Loans may be eligible for a Direct Consolidation Loan if they include at least one FFEL Loan and have been unable to obtain a Federal Consolidation Loan with a FFEL consolidation lender or have been unable to obtain a Federal Consolidation Loan with income-sensitive repayment terms acceptable to them or intend to apply for loan forgiveness under the Public Service Loan Forgiveness Program.

http://loanconsolidation.ed.gov/index.html