In July, I lost my job. Unemployment covered nearly all of my expenses aside from my private student loans with Wells Fargo. I have 7 student loans through them with a balance of approx $73K and monthly payments of $835. I missed 3 payments (July-September). In October I was told to make a minimum payment of $835 in order to prevent my accounts from being accelerated. I made the payment. It counted as July's payment. In November, I made another payment. This was considered my August payment. I was told if I made 6 consecutive, on-time payments the past due amount would be placed at the end of the loan and my accounts would begin to report as current. However, the past due payments would not be removed from my credit report.
In addition, before making the first minimum payment in October, I asked if I could catch up on some of my accounts since there are 7 and therefore 7 negatives on my credit report. I was told the lender would not care that some of my accounts were current and would charge off all the accounts. At this point, my FICO has dropped over 200 points based on the 3 late payments. I am only working a temporary job which could end any day.
My main question is whether allowing the lender to charge off my accounts and send them to collections will be any worse than what I am facing right now. Will a collections agency be more willing to negotiate monthly payments? The $835/month is killing me. I have 2 other private lenders who I pay about $400 month too and my federal loans are in deferral through February, that payment will be close to $500.
Any ideas on how to proceed will be greatly appreciated!
