I am helping my wife rehab her student loans and received a statement from one of the CAs (Windham Professionals, collecting for AES; the other CA is DCS, collecting for Great Lakes). There were 2 loans, and each had a collection cost associated with it, nearly equal to the interest, or over $600 for one loan and over $1200 for the other. Is this legal? Can I get the CA to waive this?
Also, the two CAs I contacted told me the amount we would pay each month to rehab the loans, and I agreed. Can I now ask them to lower it, or is it too late? They also made me sign up for direct debit. I'm ok with that as I pay everything online anyway, but what are the chances they will take more than agreed?
This is the letter I am planning to send. Its a combination plead to lower the payment, change payment method and DV. The same letter will go to both CAs, only changing the address and amount they told me to pay.
Contact Name
CA name
Address
Address
Date
Re: Payment on Acct #XXX
Dear Name:
I recently made arrangements with you to have my student loans rehabilitated. You told me that I would need to pay $256 per month via direct debit on the 8th of each month and I agreed. I have since realized that the payment amount will cause me financial hardship as I now struggle to pay my other bills and buy groceries.
I would like to propose that instead of $256 per month, I instead pay $50. This will still put a small financial strain on me, as my grocery bill is often $200-300 per month. After my rent payment of $995, my $300 grocery bill, $100 phone bill and $50 electric bill, this only leaves $50 left over for you. [I told them she makes $1500 per month, which is true.]
With the direct debit happening each month, I have given up some financial control, and was forced to not only cut back greatly on groceries, but for the first time in several years, not pay a utility bill in full (an option not even possible with direct debit).
I am therefore pleading with you that I may be allowed to pay only $50 per month so I can continue to pay my other bills and remain healthy enough to work. I further would like to retract my permission to directly debit the bank account, and instead charge the $50 to a credit card. I will provide the credit card number when I have received a letter accepting these proposed changes.
Additionally, as I am not sure where you arrived at the balance amount, according to the Federal Debt Collection Practices Act, I have a right to have the debt validated. I am requesting and requiring that you forward all proper original documentation to me proving this debt. You are hereby required to provide the following:
*Contract of said account with my original signature.
*Complete billing and payment history.
*Copies of all certified letters sent to my address.
*Notarized statement that you are authorized to collect this debt and by whom.
*Notarized statement claiming you believe in the authenticity of the items (A), (B) & (C ).
Should, in the course of gathering these items, the authenticity of any of them be brought in question, you must cease and desist all actions, including any collection activities, on said matter, and notify OC of your findings.
Please forward your documentation to me upon receipt of this certified letter. Please note that proper documentation is not simply a print out or bill from you and this debt can not be validated without a contract bearing my original signature. If you are unable or unwilling to furnish said documents then you must cease all collection activities.
Thank you.
Please send all correspondence to:
Name
Address
Address
Sincerely,
Name
[NO signature]
Any and all critiques are welcome; however, I want to get this letter out ASAP so I can get their response and reply back with CC information before the next debit on October 8th. Thanks!
