Payment Agreement without Signed Agreement

[Anonymous]

Hello,

I have a 30 years defaulted student loan and I am on Social Security Disability.  Several years ago, the FDSL started deducting from my Social Security Check and after about 6 months I was contacted by a collection agency.  A signed agreement was made between us and the garnishiees stopped.  After a few months I called the collection agency and told them the amount I originally agreed to was causing a hardship.  The lady I spoke with was very nice and told me about a "hardship" program whereby I would pay nothing but I would still be responsible for the loan and interests would continue to accrue.

Now 4 years later I get a letter from FDSL basically stating I was in default again, my loan was in a collection agency and if I did not contact them within 30 days they would again deduct from my disability check.  While reading the letter it just so happpened I received a called from a woman asking me to verify my social security number.  I asked her who was she, she gave her name and then I asked from where was she calling, she responded Conserve.  I told her I never heard of her or her company and not to call again.

Right after the call I called FDSL and was told my loan was in collection and gave me the telephone number to the company which happened to be Conserve.  I called Conserve to make payment arrangements.  After giving them all the required details, I was first asked if I could pay the loan in full, I said No, then I was asked if I could make an initial payment of $1400 and again I said No.  Then I was told I could qualify for a special program whereby I would pay them $5.00 that day to establish my place in the program since there were limited openings and $75.00 a month.   All I had to do was to give her the number to my debit card, which I never told her I had.  I calmly told her I could not pay that particular amount and I definitely would not give her the number to my debit card over the phone.  However, if we could come to an agreement and I was sent agreement documents, I would give them all the information required.  At this time someone else took the phone.

The new person told me they did not do agreements and if I did not give them my debit card number, she would call FDSL and tell them I was non compliant.  I told her to do what she must and hung up.

I am sure the amount which will be garnisheed from my social security will be at least $75 +, however, to give Conserve the information they requested over the telephone without a prior agreement does not seem to be in my best interest.  Can you please offer me an advice?

Thank,

VaEsther

[Anonymous]

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@Anonymous wrote:

Hello,

I have a 30 years defaulted student loan and I am on Social Security Disability.  Several years ago, the FDSL started deducting from my Social Security Check and after about 6 months I was contacted by a collection agency.  A signed agreement was made between us and the garnishiees stopped.  After a few months I called the collection agency and told them the amount I originally agreed to was causing a hardship.  The lady I spoke with was very nice and told me about a "hardship" program whereby I would pay nothing but I would still be responsible for the loan and interests would continue to accrue.

Now 4 years later I get a letter from FDSL basically stating I was in default again, my loan was in a collection agency and if I did not contact them within 30 days they would again deduct from my disability check.  While reading the letter it just so happpened I received a called from a woman asking me to verify my social security number.  I asked her who was she, she gave her name and then I asked from where was she calling, she responded Conserve.  I told her I never heard of her or her company and not to call again.

Right after the call I called FDSL and was told my loan was in collection and gave me the telephone number to the company which happened to be Conserve.  I called Conserve to make payment arrangements.  After giving them all the required details, I was first asked if I could pay the loan in full, I said No, then I was asked if I could make an initial payment of $1400 and again I said No.  Then I was told I could qualify for a special program whereby I would pay them $5.00 that day to establish my place in the program since there were limited openings and $75.00 a month.   All I had to do was to give her the number to my debit card, which I never told her I had.  I calmly told her I could not pay that particular amount and I definitely would not give her the number to my debit card over the phone.  However, if we could come to an agreement and I was sent agreement documents, I would give them all the information required.  At this time someone else took the phone.

The new person told me they did not do agreements and if I did not give them my debit card number, she would call FDSL and tell them I was non compliant.  I told her to do what she must and hung up.

I am sure the amount which will be garnisheed from my social security will be at least $75 +, however, to give Conserve the information they requested over the telephone without a prior agreement does not seem to be in my best interest.  Can you please offer me an advice?

Thank,

VaEsther

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The general rule is to never give a CA your banking coordinates.  What I would do -- in an absolutely worst case scenario -- is get them to state exactly what they propose over the phone and record the conversation.  Make sure you or they are not in a two-party state first.     

Unfortunately, student loans never die and one way or another they will get their money.

[Anonymous]

Thank you for your reply. I do not understand what is meant by "two-party state." Would you mind explaining this to me. Also, is it a regular practice for a ca to attempt to force a borrower into an agreement over the telephone and without a "written" agreement?

[laz98]

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@Anonymous wrote:
Thank you for your reply. I do not understand what is meant by "two-party state." Would you mind explaining this to me. Also, is it a regular practice for a ca to attempt to force a borrower into an agreement over the telephone and without a "written" agreement?

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two-party state is referring to state laws that require both parties to a conversation be informed that the conversation is being recorded.  if you live in a one-party state, you don't have to tell whoever you are talking to that you are recording the conversation.  in a two-party state, they must consent to being recorded.

yes, CAs try to get as a far as they can without putting anything in writing, so it can't be used against them later.

[Tazman81]

Do you know who the loan was originally through?  It sounds to me that you should qualify for some type of IBR (income based repaymnent) plan.  Especially if this was a federal loan, there are usually more options for anyone with a financial hardship.  Have you looked into anything such as that?

[Anonymous]

Hello,

I apologize for my delay in responding.  To answer your questions:

Whenever I talked with someone from Conserve I was told the conversation is being recorded.

My student loan is a federal loan. 

To update:

I was called again by someone else at Conserve.  I repeated the conversation I had with the first person and said I was willing to make reasonable payments but I was not going to give my banking information over the telephone.  During the conversation I revealed I am on permanent disability which seemed to rake the conversation in a totally different direction. 

I was then transferred to the "Disability' department where I gave information regarding my disability.  I was then sent papers to have my doctors fill out.  It appears there is a program I may qualify for which will allow me to be excused from making payments on my loan during my disability, however the loan remains and interest will continue to accrue.