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  1. #1
    Join Date
    Nov 2013
    Posts
    3

    Default Lender Won't Rehabilitte Loans Despite Small Payments During a Period of Illness

    My question involves collection proceedings in the State of: Georgia. Hi. I have a pile of student loan nightmares brought on by the DOE. When I consolidated my loans, somehow my grad school loans were missed. The loans went into default and I had to put them into rehab. I finished paying the rehab in Feb. 2009. I fell behind on the payments again as a result of being unemployed. I then was diagnosed with Stage 3c breast cancer and went through a year of intense treatment. As a result of the chemo, I have sustained serious injuries and am currently unable to work and the doctors do not know if I will ever recover. I was contacted by a collection agency for the DOE in November 2011 and was given the option of putting the loans into rehab and was told that I could pay $5.00 per month for 9 months and the loans would come out of default, and my credit would be cleaned up and a new servicer would take over. I made the 9 obligatory payments on time and was assured by the Collection Agency that I made it through the rehab process and would be contacted by the new service provider. The last payment was made in Sept. 2011. I contacted the CA today because I had not heard anything new and was assured that I had finished the rehab process and should be contacted soon. I asked for the number for the DOE and called them directly. I was informed by the DOE that the loans were in fact not rehab'd because I had already put the loans into rehab once before and that the collection agency knew that I did not qualify. I was told that the only option I had was to pay the loans in full. I called the CA back and the lady I spoke with had no idea that I didn't qualify for rehab and simply said she was sorry to hear this.

    Is this legal? I made the 9 payments in good faith and have been doing the best I can to try to get back on my feet after surviving a horrific battle with cancer and losing two jobs in 3 years. Do I have any recourse against the collection agency or the DOE for continuing to accept my payments that I thought were being applied toward rehabilitation of my loan?

  2. #2
    Join Date
    Sep 2011
    Location
    OH10
    Posts
    17,019

    Default Re: Student Loan Put into Rehab by Collection Agency but Rehab Rejected by Doe

    You paid $45. Not a compelling argument for attempt to pay. It is likely too late to obtain a deferral due to unemployment.

  3. #3
    Join Date
    Nov 2013
    Posts
    3

    Default Re: Student Loan Put into Rehab by Collection Agency but Rehab Rejected by Doe

    I made the $5 payments in good faith. The collection agency determined the payment based on the fact that I had no income at the time due to my battle with cancer. The deferral due to unemployment has in deed passed since the loans are now in default.

  4. #4
    Join Date
    Sep 2011
    Location
    OH10
    Posts
    17,019

    Default Re: Student Loan Put into Rehab by Collection Agency but Rehab Rejected by Doe

    You do not have an agreement in writing.

    Quote Quoting graciemay
    View Post
    I made the $5 payments in good faith. The collection agency determined the payment based on the fact that I had no income at the time due to my battle with cancer. The deferral due to unemployment has in deed passed since the loans are now in default.

  5. #5
    Join Date
    Nov 2013
    Posts
    3

    Default Re: Student Loan Put into Rehab by Collection Agency but Rehab Rejected by Doe

    Thank you Disagreeable. However, I am not convinced that the Collection Agency has not violated the FDCPA. I do have it in writing, as well as verification of each one of my payments from both the CA and the DOE and the CA's own records indicate that they were putting me through the rehabilitation program.

    I'm just not sure what to do next. I desperately want to get the loans out of default and get on a payment program. The DOE has advised me that I can only pay the loan in full to get it out of default and since it has now gone from $18,000 to $80,000 due to penalties, collection agency charges and interest, paying the loan in full is simply not an option for me.

  6. #6
    Join Date
    Sep 2011
    Location
    OH10
    Posts
    17,019

    Default Re: Student Loan Put into Rehab by Collection Agency but Rehab Rejected by Doe

    If you have it in writing, see a lawyer.

  7. #7
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Student Loan Put into Rehab by Collection Agency but Rehab Rejected by Doe

    Quote Quoting graciemay
    View Post
    I do have it in writing....
    Who provided this writing, when was it provided, and exactly what does it say?

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