I have a thouroughly defaulted student loan, and a notice of collection. I am curious about wether I can expect this to affect a sm check or a mfc direct deposit?![]()

I have a thouroughly defaulted student loan, and a notice of collection. I am curious about wether I can expect this to affect a sm check or a mfc direct deposit?![]()
Yeah, they can take your money, but can't garnish your "wages" since you don't have wages.. Sm & MFC are your "earnings", but you can expect that they'll go after "earnings" if they're in your account. I assume you've been reporting the income on your taxes...
Last edited by Cam_Model_Jess; 09-10-2013 at 07:46 AM. Reason: To clarify the difference between "garnishment" and taking your money from your bank account

I havent been working consistently, Im horrible at managing my finances...
If it's income, and it's in your bank account, they can take it. I'm not sure about the exact details. When I worked at a bank, if a customer came in who had a garnishment on his account (usually men for child support) there was a note on the account, and we had to put a certain portion on hold when they tried to deposit/cash a check. The customer then had access to the rest of the money.
I also have a friend who has garnishment & doesn't have a bank account. But his employer takes the money from his check before he gets it.
They don't usually start to garnish for student loans unless you've been through all your "delay" periods AND it's been a whole year since that point. If it hasn't been a year yet, see if they will work with you. But if the paperwork to garnish wages has already been put through, there's nothing they can do.
Last edited by Cam_Model_Jess; 09-10-2013 at 07:49 AM. Reason: details on specific garnishment

Yea Im in the rabbit hole, my only option is $522 per month and I assume they'll stop if I make the payments. *yikes* College :/
Oh, if they're letting you make payments still, that's good. If I was you, I'd do whatever it takes to make those payments. I'm sure your credit is already a little messed up from it coming to that point. But if they have to garnish, it will look much worse.
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You can PM me if you want.





I was under the impression that for a garnishment their had to be first a court judgment. Not sure how student loans work though. You can check on nolo.com they have information on legal issues.
MANY MEN WANTED TO LAY ME DOWN, BUT FEW WANTED TO LIFT ME UP
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http://www.dol.gov/whd/regs/compliance/whdfs30.htm
"The Higher Education Act authorizes the Department of Education's guaranty agencies to garnish up to 10% of disposable earnings to repay defaulted federal student loans."
There's a section that helps you calculate "disposable income" but for some reason SW won't let me paste it here.

Thank you so much for the resources and advice! I truly appreciate it. I hate the stress its causing, but knowing I have options feels good

10% would be less than the monthly payments they want, but Im assuming it'd be better to cough up the 522 a month





NO they will NOT garnish your wages more than likely, You are self employed sm and mfc are NOT your employer, I know this for a fact, I was sued last year by a creditor i defaulted on a few yrs prior and they garnished my bank account because they had NO idea where I work. So YEA they WILL garnish your bank account.

Thank youI just found out I cant get free legal help due to my bf's (who has nothing to do with my defaulted loans) income. I live with him and this is the 2nd time his income has screwed up my ability to get help :/
Well, they are a bit different in that I don't believe they have to get a court to approve them. Other than that, I don't know.





They have been taking tax refunds like mad for the past 2 years



The government does not need to get a court judgement against you to garnish your wages, they simply have to verify your employment and then send garnishment paperwork to them. I used to be a student loan debt collector (at a collections agency, not working directly for the Dept of Education)... They do have programs, I'm assuming the $522/month is the rehabilitation program to get your loan out of default? If they can't garnish your wages (You can't garnish an independent contractor's wages, because technically, you're your own boss, and you'd have to fill out the garnishment paperwork YOURSELF, and then they'd be able to garnish your bank account, I believe) they'll move on to taking your taxes, but that will NEVER pay off your student loan. While it may take a chunk out of it every time, the interest you accrue over a year builds your balance back up in most cases to what it was previously by the time they take your taxes AGAIN. I would definitely ask them about the Loan Rehabilitation program... Don't even admit that you have a job as a cam girl, just skip it and say you're unemployed but your bf has a job, as they cannot take money from him for your loans. The rehab program that my collection agency had was a 9 month program of making payments of whatever they ask, and after that 9 month period, your loan gets out of default status and you then again can apply for deferment and forbearance. It also will fix your credit. If you can't make the $522 payment, ask if you can make a payment of something that is more reasonable, give them a number you could reasonably afford, and see if they can get you a special situation where you make a lowered payment due to your hardship, sometimes they are willing to do that based on your situation. Hope that helps!
xoxoxox



https://www.myeddebt.com/borrower/my...s_rehabilitate <<< that link is to the ACTUAL website containing defaulted student loans, etc, and tells about the rehab program.
xoxoxox

Thank you so much! Reaching out has been something I've had a hard time doing in the past, but recently I've learned that its probably my best option. Wealth of knowledge ^^^^^^^^^^^^^^^



Yes they took my last couple of tax returns, but one of the reasons I wont get a vanilla job was because I didnt want my wages garnished, I was unaware they could do this with the camming money.



How much is your student loan, if you don't mind me asking?
xoxoxox





They can't take self-employed money, but they can take your stuff. Your bank account, your car, and your home if you own it. They can sue you and get a judgement against you which will sit on your credit report 7 years from the date of last activity, and it will also affect your credit score.
Your best bet would be to contact them, tell them how much you are making monthly, and send a copy of last years tax return as proof, and ask for a payment amount based on the amount you make.

I will have to have a ruling I think, they wont take anything less than 522 a month, according to the representative I spoke to .



The payments they calculate are based on a certain percentage of your balance, so I'm assuming your student loan is quite substantial. :/
xoxoxox





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