Is It Possible to Pay to the Principal with Sallie Mae?

[curiousMind]

Hi there,

I've been through the wringer with Sallie Mae. Just got discharged with Ch. 7 Bankruptcy, but of course, the Sallie Mae Private Loans are not. Is it possible to pay to the principal first? It seems like no matter how much I pay, it doesn't decrease.

Thanks for your help!

[nc73]

Well any additional payment can go to principal, you just have to tell them to apply it that way. Of course SM customer service sucks. If you let the loan go to collections they will offer to settle, only if it is a private loan though. I've just successful done this a few months ago for a significant amount.

[KeithDoxen]

Well any additional payment can go to principal, you just have to tell them to apply it that way. Of course SM customer service sucks. If you let the loan go to collections they will offer to settle, only if it is a private loan though. I've just successful done this a few months ago for a significant amount.

NC, tell us a bit about your settlement. I know there are lots of people on here dealing with private student loans, so perhaps you can give us an idea of what lenders are willing to accept as a settlement.

[nc73]

Well I defaulted for about two years and after bk I called them up. they said they had already sent settlement letters, course my addy was never updated. In any case They said the offer was for 7600, with interest I owed almost 12k. I told them sure send me the letter again since I never got the first one. They said no (allied). I waited a few days and they called back so I told them where is my offer letter. So I told them I'd pay it just email me the offer. They did so at 6800 (I never asked for a lower amount). I paid that with a wire transfer and waited for the amount to zero out in my online account. It took two calls afterwards but the account finally zeroed out today and I owe them nothing. In any case I've heard they will go below your current principal, 80% is safe. My principal was over 9k and with interest it was 12k. So basically settled for almost half if you count accrued interest and penalties. I could probably have settled for less than 6800 but I just wanted to get rid of them. So wait until it goes to the collection agency and if your loan defaulted they WILL settle. They usually let Allied interstate do the settlement and they don't get involved. There are stories out there of people that settled with SM but still saw the remaining balance on their online account. they just need to call SM to get it straightened out. So it only took a little over a month to clear out the account once I had wired them the money. Just get everything in writing and you are set!