Credit Card Center Advertiser Disclosure

New Visitor
Posts: 2
Registered: ‎06-27-2017
0 Kudos

collection agency doesn't want me to rehab

Hi all,


After a recent bout of unemployment, I found out that my Perkins loan has gone into default.  When I received the initial phone call last Friday, the CA rep told me I had three options, I could pay it in full, consolidate, or set up a payment plan of six monthly payments to pay it in full.  When I told her I'd need to think about whether to consolidate or do the monthly payments, she told me I had to call her by Monday at 5 PM to let her know if I was going to consolidate or pay in full.  I told her paying in full was not an option but I would need to think about the other two.  I asked her for a number to reach her at and she hedged, telling me she'd email me her contact information.  Over the weekend, I spent a good bit of time researching, including finding this site, and realized that rehabilitation is an option she conveniently forgot to mention (this is the first time I've ever had a loan in default). 


I found the name of the collection agency from the former servicer, ECSI (I'm pretty sure she neglected to tell me where she was calling from) and found a number for them.  Monday I called, eventually got transferred to the correct department after my rep was unavailable, and spoke to a reasonably competent and sympathetic woman who wanted to make sure I understood the difference between rehabilitation and consolidation and when I discussed why I didn't and never have wanted to consolidate, she said I seemed pretty familiar with the process...and when she put me on hold to find something out about the rehab payments, she transferred me to my personal rep.  Smiley Frustrated


My rep told me that in order to rehabilitate the loan, they would split the balance into 9 monthly payments and then I'd be done.  I informed her that was not how it's supposed to work, and she argued with me!  She said she would have to contact the school to see if they would agree to rehabilitation and wanted to know what I considered a reasonable payment.  I listed a range I would be willing to pay that I thought was reasonable (higher than my original loan payment was, even) but she didn't know if the school would "approve" it.  She said the reason they usually do 9 monthly payments is that supposedly students "forget" they still have to pay the rest of the loan back after rehab.  She also told me thet the loan will go directly back to the former servicer once I complete the rehab.  Once I got off the phone with her, I called my college and got transferred to the controller's voicemail since he's apparently the one who would approve such things.  I haven't heard back from him yet, though.  I'll be trying again soon.


Since I've read on this site that sometimes CAs don't even mention a reasonable payment to the college and instead try to make it absurdly high, what are my options if she comes back to me with a payment that is more than I can manage or think is reasonable?  What if she claims the college doesn't want to do rehabilitation--the college isn't allowed to refuse me this, are they?  I'm still peeved that the rep did not bother to try to inform me of all my options, but I don't expect much of someone who works at a collection agency.  Another question I had was that the Perkins loan went into default after 150 or 180 (not sure at the moment) days behind, but I thought it was 240 or 270 days for federal loans?  I also don't want to pay back too much of my loan because I found out belatedly that I qualify for part of the loan to be cancelled due to my occupation.  I now have a job again, so paying the loan back won't be an issue once it comes out of rehab.  I just don't want to get swindled by the collection agency.  I'm disappointed it's come to this because I'd been paying ahead on this loan before I became unemployed last year and had planned to have it totally done by the end of this year.


Any help or advice would be appreciated.  Thanks!

New Member
Posts: 3
Registered: ‎06-29-2015
0 Kudos

Re: collection agency doesn't want me to rehab

I rehab my defaulted loan a few years back. Originally they wanted me to pay over 800 a month. I told them I wanted to itemize my monthly expenses. Basically give then a break down on my bills. My payment was dropped to 103 a month. Sounds like they are trying to play hard ball. I would just keep insisting and calling back until you can find the right person to help you.

New Visitor
Posts: 2
Registered: ‎06-27-2017
0 Kudos

Re: collection agency doesn't want me to rehab

Thanks for the reply.  $800, that's ridiculous!  Glad they finally worked with you on that.  I actually got a call today from my rep saying she hadn't heard back from my college yet and was going out of town for a few days so I wouldn't hear from her for a few days yet lol.  Maybe next week I can get ahold of someone at the school and make sure they're alright with a reasonable payment.

Regular Contributor
Posts: 245
Registered: ‎02-22-2013
0 Kudos

Re: collection agency doesn't want me to rehab

[ Edited ]

I had to rehab 18 different student loans back in 2013/2014, and the Perkins Loan was by far the hardest when negotiating with the CA.


They shouldn't have to talk to your college at all when it comes rehab terms.


All they have to do with the college is to sign back over the debt to them when you finish rehabbing.  At least, that's the way it was with my college. The college, itself, was the Perkins Loan sevicer.


Next time you're on the phone with the CA, make it clear you're trying to negotiate a fair and reasonable monthly payment you can afford (using the IBR formula, most likely) for rehabilitating your loan. If they don't comply, tell them you'll be contacting the federal ombudsman.  If they still don't comply, then DO contact the federal ombudsman. 


I'm betting they'll quit fiddling around, and complete a contract with you. 


I'm in public service, and since I rehabbed my Perkins Laon, I've gotten 50% of it cancelled. 2 more years, and I'll have the whole thing cancelled. 

TU FICO: 778 ||| EQ FICO: 784 ||| EX FICO '08 : 780

Forums posts are not provided or commissioned by FICO. Forums posts have not been reviewed, approved or otherwise endorsed by FICO. It is not FICO's responsibility to ensure all posts and/or questions are answered.

† Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
‡ Credit cards for FICO Score ranges: The score ranges are guidelines based on internal myFICO analysis of actual applicant approvals, and having a FICO Score in a particular range does not guarantee you will be approved for credit cards recommended in that range. These ranges were not provided by any card issuer.

* For complete information, see the terms and conditions on the credit card issuer’s website. Once you click apply for this card, you will be directed to the issuer’s website where you may review the terms and conditions of the card before applying. While myFICO always strives to present the most accurate information, we show a summary to help you choose a product, not the full legal terms - and before applying you should understand the full terms of products as stated by the issuer itself.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.