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Student loan- refund garnishment

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Student loan- refund garnishment

Guys, quick question. My wife had student loans in default and our returns were taken by dept. of ed 3 years in a row. Now that they are in good standing after rehab, will they be offset still or that drops off?
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Valued Contributor

Re: Student loan- refund garnishment

No, that ends and I want to say that your should be getting money back as the garnishments should stop like 5,6 (??) months into rehab. Stick with this because sometimes what should happen rarely does.
After a few months she might think about disputing the lates if there are any. This sometimes removes them. Just make sure there aren't worse late hidden.

What plan did you guys pick? Are your aware of the income-driven repayment plan?



Message 2 of 9
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Re: Student loan- refund garnishment

what do you mean we should be getting money back? and we are aware on income driven repayment plan but we have received two monthly statement from Navient so far and they ask $ 2 dollars per month

 

Late payment wise, as soon Navient picked up loans all other accounts vanished on TU and EX but one remained on EQ. 

Message 3 of 9
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Re: Student loan- refund garnishment

I mean if you're asking should it stop, sounds like it hasn't already. I believe it was supposed to have already stopped. Don't quote me on this, but if I find the information I'll send it to you. I thought I saw or was told that garnishments stop before you're done with rehab. I could be wrong. If they continued past when they were supposed to, yeah they would owe you money.
If the payment on IDR would be $2, then I would also strongly suspect you would have a chance at applying to get a tax offset back (if there was one). It's not guaranteed but you can still apply.

With an IDR of $2, is the general forgiveness the plan? Make sure to make each of the payments on time in that case. You can schedule them ahead by several months (and of course always check it's been applied) but you cannot pay ahead and it still count towards the required qualifying payments.

I would also take a quick peek at the NSLDS website and make sure there aren't any loans that went to a different collection agency. I've seen it happen to a few people.
You could always try your luck with EQ if there aren't any worse that what's reported or you could just wait it out. Honestly, 2 out of 3 is great for her. It can be a difficult process often.



Message 4 of 9
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Re: Student loan- refund garnishment

No, what should be my question- will they offset refund now that loans are back to current and not defaulted anymore? she  called offset irs phone number and that state theres no offsets on her ssn. we checked on NSLDS website and her loans are with navient both! we paid $50 towards each of loans  from auto payment from checking account every month. 

Message 5 of 9
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Community Leader
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Re: Student loan- refund garnishment

Oh, sorry about that. That is what you asked. I keep only seeing garnishment.

No, you won't get it back. She owed the money and since it wasn't paid they took it from her refund. The only option is to do that process above where you ask for them to return the offset based on not being able to afford it but it's completely up to them whether to approve it or not. Also when they mean afford they mean like you'll be homeless without it kind of thing. So unfortunately, if that is not the case, it's probably just gone.
You started that $50 was paid per month? That seems like an abnormally high payment when there IDR payment afterwards is $2. I'm not sure there is anything to do about it though.



Message 6 of 9
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Re: Student loan- refund garnishment

Honestly it was my choice to pay 50 per month. I would like to pay it back. On the other hand i dont need those garnishments back i just wanted to make sure that now that loans are rehabilitated they will stop offset.
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Community Leader
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Re: Student loan- refund garnishment

Oh that's great then! It will definitely reduce the interest. And with a low minimum payment on IBR or REPAYE, there is an interest subsidy. The gov will pay all or a portion of the unpaid monthly interest on the loans. So the payments can go towards more of the principal. And any interest does not capitalize on IDR plans.
No, now that the loan is out of default, the regular payments resume and they will not take from anything else. I would recommend that you can to make sure, but you already did. Looks like you've already got everything covered! 🙂



Message 8 of 9
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Re: Student loan- refund garnishment

you won't get money back from past tax returns that were garnished. 

 

i actually held onto 3 years of tax returns because i knew i would be garnished, and submitted them all after i was cleared with the IRS several months into the rehab process.  it sucked giving the government an interest-free loan for all those years, but it was my fault, after all. 

 

 

800+ for all 3 CRAs.

Took 4 years after rehabbing a bunch of defaulted student loans, but totally worth it.
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