Rehab during covid

tooleman694 · ‎08-13-2020

My wife started her rehab program around Feb this year. Covid hit and they said no need to make payments and they count as if we made them. Now Trump has extended it to the end of the year. So we get to rehab with only making 1 or 2 payments.

My question is, since the 9 payments end during the covid period. Can they call the rehab complete now? Kind of dumb I think to make us wait it out the full 9 months if they are not taking payments.

Red1Blue · ‎08-13-2020

@tooleman694 wrote:
My wife started her rehab program around Feb this year. Covid hit and they said no need to make payments and they count as if we made them. Now Trump has extended it to the end of the year. So we get to rehab with only making 1 or 2 payments.

My question is, since the 9 payments end during the covid period. Can they call the rehab complete now? Kind of dumb I think to make us wait it out the full 9 months if they are not taking payments.

To be honest, I have no idea how Trumps executive order would work with the student loans. My student loan is serviced by Great Lakes. It says my next payment is due 11/2020. I have decided to keep paying the payments even though loans are not accumulating interest.

This is the time to bring the principle down when the interest is not accumulating. Once they start charging interest it will cost me $500 / month in interest alone. I am taking a head start using this forebalance. I would love to see Trumps order take effect and my payment pushed to 2/2021 and do not accumulate interest. It is almost a saving of $4000 - $5000 in interest costs.

Let us wait and see when the Trumps order becomes a reality and receive communication from my Loan Servicers.

Anonymous · ‎08-13-2020

@tooleman694 wrote:
My wife started her rehab program around Feb this year. Covid hit and they said no need to make payments and they count as if we made them. Now Trump has extended it to the end of the year. So we get to rehab with only making 1 or 2 payments.

My question is, since the 9 payments end during the covid period. Can they call the rehab complete now? Kind of dumb I think to make us wait it out the full 9 months if they are not taking payments.

They will not end it early, unless that is a part of their program. Between me and my SO we have 5 servicers we have SL rehabs with. One servicer has ending rehab early as a regular part of their program (even during non-covid times), but since they are a private servicer for fed loans, we do not benefit from $0 payments during covid.

So, no they will not end it early for you, they will drag out every month.

It is like people that have $0 payments through IBR and do the Paye or Repaye programs. They arent just going to forgive the loans now because you have $0 payments. They will make you wait the 10, 20, 25, or 30 years. And also make you recertify your income annually in hopes that you will then be required to make payments towards the loans.

Both repayment and rehab require X number of qualifying months to finish the program, so you need to finish the program in it's entirety. Remember, this is the government, there are no shortcuts. The program was built to last a certain number of months and did not include or anticipate covid and $0 payments, and normally only $5 minimum, probably to avoid the question you are asking: "if I have $0 payments, why must I wait?". You will continue to wait.

Good luck! It will be over soon, l

with less than two months to go, so just hang in there!

tooleman694 · ‎08-13-2020

Yeah I completed mine like 8 years ago and it was great. Couple more months to go for my wife.

Anonymous · ‎08-28-2020

I started my Rehab in March and DW started hers a month later. We haven't been taking advantage of the payment coverage during Covid for 2 reasons:
1: Our payments are $5 each

2: Reassurance

Personally, I don't even like to call my payments in on their automated after hours service. I like to confirm every month that I have fulfilled my requirement every month. Now that I have started taking care of my credit profile, I am terrified of the stories I have read happening to me. If it only costs $45 for that peace of mind, I'm happy to pay it!

Just my 2 cents on the subject, I am a little hesitant to trust Uncle Sam's help if I am not in a position where I need to.

Best of luck with a smooth transition to our new loans!

Anonymous · ‎08-28-2020

@Anonymous wrote:
I started my Rehab in March and DW started hers a month later. We haven't been taking advantage of the payment coverage during Covid for 2 reasons:
1: Our payments are $5 each
2: Reassurance
Personally, I don't even like to call my payments in on their automated after hours service. I like to confirm every month that I have fulfilled my requirement every month. Now that I have started taking care of my credit profile, I am terrified of the stories I have read happening to me. If it only costs $45 for that peace of mind, I'm happy to pay it!

Just my 2 cents on the subject, I am a little hesitant to trust Uncle Sam's help if I am not in a position where I need to.

Best of luck with a smooth transition to our new loans!

When making payments to rehab programs the payment go towards only the collections costs. That is why many suggest to get as low of a payment as possible because when the rehab(s) are done, then that is when the real repayment begins.

My SO has a rehab directly through the US Dept of ED and they are refusing to even accept payments during covid deferment. We both also have other rehabs with servicers that are fed backed, but private, so our payments are $5 a month to each and we must make those payments. Our principle/interest have not gone down a penny, as the $5 every month are going towards the collections costs, which through a private service, can charge up to 8% collection costs when rehab is completed (higher if you do not do rehab).

If you have direct loans or loans through the US Dept of ED rehab calls for them to charge 0% in collections costs, hence why they will not accept a penny from my SO. Had it not been for covid deferment, whatever the payments are would have gone towards collection costs, but at the end they could not add on any amount of collections costs. Again that is why it is important to get the lowest rehab payment amount.

Good luck!

quikj9 · ‎08-29-2020

@Anonymous I just registered my final payment after starting my rehab in January. Since, the CARES ACT passed, I haven't made a payment towards my loans, yet I was able to confirm with the collection agency that my rehab is complete and my loans will be transferred to a new servicer.

$45 is absolutely worth your peace of mind. Just wanted to share my experience.

Anonymous · ‎08-29-2020

@Anonymous That makes a lot of sense, I wondered how the rehab process did not pay towards the loan amount, but now I understand. Thank you, always very insightful!

@quikj9 That is really reassuring to know that the Cares Act didn't affect your rehab completion! I was worried they would just decide to extend the rehab period (with no evidence leading me to believe that) until you were able to make payments again! Hope your transition is smooth, and that you get some points back when the accounts pick back up!