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  1. #1

    Default Sallie Mae Private Student Loans Unreasonable Payments - What Options Do I Have

    My question involves collection proceedings in the State of: Pennsylvania

    Hi! I'd love any help I can get. I know you guys are busy, anything and everything would be appreciated, as I'm feeling pretty helpless and hopeless right now.

    I originally borrowed around $60,000 in private student loans from Sallie Mae. Nearly all of them are "signature" loans, meaning they have no co-signer. The cosigner on ONE loan is very old and has no income. When I signed for the loans, they said there would be no trouble consolidating them at the end and everything would be fine.

    Then, of course, the banks crashed.

    Now, even people with good credit have a hard time consolidating loans, and they REFUSE to consolidate. I've gone through every contortion with them and they say my credit isn't good enough and my income isn't high enough. I've looked into outside consolidation firms and heard the same thing.

    When I graduated in 2010, I had a hard time finding a job, like most new graduates. The one I found barely paid my rent and bills and food, so I had to go into forbearance. I was in forbearance for a bit over a year before I started paying again. Interest accrued, I'm not sure what the whole debt is now but it's a good deal higher.

    I now live in South Korea, working as an English teacher.

    The cost of living here is low enough that I can JUST afford to pay what they're asking, but the currency here is declining against the dollar and I'm not sure if I'll be able to keep doing it. There's no way I can get an income-to-cost-of-living ratio this good in the US, but what they're asking is more than $900 a month, which is a bit over half of my salary. HALF of every paycheck goes to them! It seems pretty unfair and totally insane.

    I find myself tempted to default and allow them to pursue me and eventually garnish my wages whenever I return to the US. I don't care about my credit as I don't live in the US and nobody here needs it... but I need to ensure that I have no issues visiting home (I don't want to be picked up at the airport and arrested in contempt of court, for example) and renewing my passport. (I've heard of people who evade child support payments not being allowed a passport, I don't know if that would happen here.)

    Even at half my salary, I'm in a situation where I could pay 20,000 into this loan and the balance would only go down a few thousand due to the insane highway robbery interest. If I'm going to be a serf forever, I'd lat least like to be a bit more comfortable.

    So here's my specific questions:
    1. Is there any way I can force them (non-federal, 100% PRIVATE student loans) or convince them to lower my monthly payment to something more appropriate to my income level? It's not like I'm making significant progress on my loans, and I can't afford anything more than the monthly minimum. I can't keep doing this job forever (it's a bit temporary) and I'd like to not be paying half my salary to them forever.

    2. Is there any scenario by which a refusal to pay would lead to criminal consequences? (Such as an arrest if I came back, or a denial of a new passport.) Consider that I am unable to show up in court as I live 8000 miles away.

    3. Any advice? I would be willing to pay them whatever total they want, I'm resigned to paying them till I drop dead at this point, but I'd like to get to keep a bit more of my money.

    4. Can they garnish foreign wages? What happens if I live in the US but have no income?

  2. #2
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    27,303

    Default Re: Sallie Mae Private Student Loans Unreasonable Payments - What Options Do I Have

    1. No, you can't force them to do anything.

    2. Nope. This is a civil debt; you're not going to be arrested and your passport won't be revoked.

    3. Negotiate, get a second job, whatever it takes.

    4. No, but they may be able to levy any US bank accounts. If you're unemployed, they'll wait until you're working. I'd assume you intend to work at some point?
    An intelligent hell would be better than a stupid paradise - Victor Hugo

    Do not microwave grapes

  3. #3

    Default Re: Sallie Mae Private Student Loans Unreasonable Payments - What Options Do I Have

    I'm working overseas now, and intend to stay that way -- I just wanted to make sure that if I become unable to pay, I will still be able to visit home without strife. If I return to the US, I may remain unemployed for some time with no property or money in bank accounts, so I wanted to make sure they couldn't do anything about that.

    So I shouldn't be worried about being found (criminally) in contempt of court if they win a summary judgment against me and I still don't pay?

  4. #4
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    27,303

    Default Re: Sallie Mae Private Student Loans Unreasonable Payments - What Options Do I Have

    No, because again it's a civil matter. They cannot ask that the court hold you in contempt for not paying a debt.

    Now if it were child support or spousal support? Then you might have issues.
    An intelligent hell would be better than a stupid paradise - Victor Hugo

    Do not microwave grapes

  5. #5

    Default Re: Sallie Mae Private Student Loans Unreasonable Payments - What Options Do I Have

    Quote Quoting Dogmatique
    View Post
    No, because again it's a civil matter. They cannot ask that the court hold you in contempt for not paying a debt.

    Now if it were child support or spousal support? Then you might have issues.
    Thank you! I'm a lot less scared now, I really appreciate this. I was only worried about either landing somehow in jail or being stopped from leaving the country (via not letting me renew my passport.) I really appreciate the advice.

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