Co-Signer for Private Student Loan

**plintner** · 07-21-2011, 02:40 PM

My question involves collection proceedings in the State of: Minnesota

Back in 2005 I co-signed for a private student loan for my son. At that time he was 24 years old. The loan amount was originally $14,000. I soon found I had made a mistake because he dropped out of school not long after that and he still had to pay the loan back. Since then he has been in and out of jobs and is currently unemployed. I don’t see him getting a job anytime soon. I had filed for bankruptcy with my spouse that same year after that but my attorney told me I could not discharge this loan, so we did not.
After deferments in hopes he would get a job, we can no longer defer. The loan has now escalated to $24,000. After many many phone calls and letters, and me being in contact with AES and then the collection agency, I borrowed the maximum I could on my pension. This only equaled to less than $4,600. It brought down the loan some but not enough. I cannot borrow against my home since our market value has gone down so much, $20,000 down. I can only make $100 a month payments until it is paid off which only pays about $20 a month on the principal. I am going to be 50 this year and I am afraid that I will never get this loan paid off at this rate (I may not live long enough). My credit will always be poor because of it. I have already felt the brunt of this when applying for a car loan.
The collection agency is not willing to go down unless I can make a settlement payment of $18,000 which I do not have. We live in the poorest county in the state of Minnesota so it is hard just to make ends meet paycheck to paycheck.
What can I do?

**KeithDoxen** · 07-21-2011, 05:08 PM

You can keep paying 20 dollars a month on the principal or you can stop paying, at which point they have the option to sue you and garnish your wages or attach non-exempt property to satisfy the judgment. The real answer here is for your son to get a job and begin paying. He is in his 20s. The fact that you "don't see him getting a job anytime soon" is the source of your problems.

**plintner** · 07-25-2011, 08:15 AM

Yes Keith I am in total agreement with you. He is the problem but until he "grows up" gets a job and starts paying, I am in trouble. I have my own student loans I am also paying on and his is really hurting me financially. I was just hoping there might be some answers or help for me.

Thank you Keith for replying.