Navient Student Loan Collection and Interest Charges – Losing Income
My spouse had a loan taking out through Sallie Mae for school purposes back in 2006. Not sure what the original amount was on that loan, but right now she was issued a garnishment order by the state of Colorado in order to pay of the loan, which according to the documentation received is over 10,000 dollars. My wife works nights at Wal-Mart and I am in the military about to move to Germany for relocation.
My wife will obviously loose her job, and be unable to pay off the loan, not even making a dent because of the interest accumulating. This will happen within the next 6 months.
Can interest still build even after loosing her job? It will never be paid of unless I will the lotto or come up with cash for a settlement. I'm just worried that the interest will accumulate making it impossible to pay the student loan off.
Can interest still build up on a collections loan even after loosing an income source? How much will Sallie Mae or Navient accept as a settlement?
—Horacio
Short answer
Private student loans, like those obtained through Sallie Mae and serviced by Navient, come with few options. Settling one is possible, but the savings are smaller than on credit card debt, and a wage garnishment makes a settlement much less likely for as long as it is running.
Key points on this page
- A private student loan affords you little in the way of payment options, and when payments are not being made the balance grows from interest, often at a significant rate.
- If the loan has not been consolidated through a government program, look into whether it can be. It may need to be brought current first.
- Government backed loans open up alternatives a private loan does not have, including income based repayment.
- While a garnishment is in place, settlement is less likely, because the servicer keeps getting paid for as long as you hold that job.
- Once the garnishment is removed, or stops through a job loss or a job change, settling becomes possible with planning and available cash.
- Savings on private student loans are generally not as good as on delinquent credit cards. Expect somewhere between 20 and 50 percent off the balance, and do not treat less than half as a realistic target.
Unfortunately, at least for the time being, there are not many options for private student loans like those obtained through Sallie Mae.
Navient Student Loan Collections
If the loan has not been consolidated using some of the government loan programs available, consider looking into this option. The loan with Navient may need to be brought current before it is eligible for a government loan consolidation.
Why would you consider this? You are stuck with a loan that affords you little payment options. When payments are not being made, the loan grows from the interest being charged, often at a significant rate.
Having government backed student loans means more payment alternatives, like income based repayment plans (IBR).
Settling a Private Student Loan Debt for Less than the Balance Owed
There are options to settle a Sallie Mae loan. While there is a garnishment, settlement is less likely. This is because Navient will continue to get paid as long as you’re at the job. With some planning and availability of cash resources, and once the garnishment is removed, or no longer applied due to job loss or job transition, settling a Sallie Mae student loan is possible.
The settlements on private student loan debts are generally not as good of savings as credit card bills that go delinquent. Depending on the circumstance you may only save 20 to 50% off of the balance owed on student loans being serviced by Navient. I am seeing some signs of better settlement offers on private student loans, just not enough of them to call it a trend, or to recommend negotiating for less than half of the balance as a realistic target.
I realize that may not be helpful right now, unless you were able to identify a source of cash that would allow you to settle the student loan shortly after the job loss. But I am pointing this out to show that even saving up money over time to settle the student loan is better than no options.
I wish I had better feedback to share. But there are just no great options for dealing with unmanageable private student loan debts through Navient, NCSLT, Great Lakes, and other private student loan collectors right now. That may change in the future. The student loan debt crisis is still growing. Recent reports show that over 10% of government backed student loans are in some form of delinquency. Private loan default numbers are terrible too. With the spreading awareness of the student loan bubble popping I do expect more options on private loans in coming years.
Update: I recently interviewed Andrew Weber for Debtbytes. If you are dealing with Navient, or any private student loan servicer (or debt collector), take the time to play the video. You can get feedback from Andrew in the comments below.
Anyone struggling with a Navient private loan, or any other servicer or debt collector, is welcome to post comments and questions below for feedback and resources in response. If you would like to discuss your options for settling student loans with a professional you can call 800-939-8357, and choose option 4.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
Hi guys! My situation is a little different than already being in default…. I am actually still in graduate school (until May) and have been anxiety ridden for the past year about just how I will be able to pay off both my private and federal student loans. Although I have not yet defaulted (because I am not yet finished with school), I know that I WILL be unable to pay for my loans when they begin after graduation. After calculating, my federal loans alone will be over $600+ a month and private averages around $380+. I am an unlucky one in the fact that although my private loans were not switched to Navient, I am stuck with dreaded Sallie Mae in this nightmare of debt. I’m almost positive after graduation Sallie Mae will drastically up my interest rate which all loans are already at a staggering 8.25%. Is there any way to negotiate with the lender BEFORE I become delinquent or strapped down to a payment I simply cannot afford with both private/federal loans? I’ve been able to pay off 3 of my smaller private loans already in school, but the monthly averages already provided have been enough to keep me from getting married and moving out of my parent’s house-let alone think about children within the next few years. Any and all help is certainly appreciated at this point!
Hi Katlyn, the good news is that your federal loan repayment options aren’t determined by your loan servicer, so you would probably be able to apply for payments related to your income on the federal loans. You can evaluate and apply for federal repayment plans at http://www.studentloans.gov.
For the private loans, I have seen a couple instances where Sallie Mae did not switch the loans over to Navient. I have been able to settle Sallie Mae loans for between 40-50% of the balance owed, although the low end of that range is only possible with a lump sum settlement.
If you couldn’t afford a settlement, there may be a low interest repayment option on the private loans, but this is typically a short term solution and not a long term one. Feel free to call in to the hotline and press Option 4 if you’d like to schedule a full consultation regarding your private loans.
Gentlemen, I had taken out a Sallie Mae loan in 2005 for about $2280.00. the last time I paid on it was in 2009. Now they want $4329.00. Is there a statute of limitations on collection? Does this still show on my credit report and what should I do?
Check out these to posts about your state SOL to sue, and how long negatives stay on your credit reports.
Agreed with Michael and this also depends on whether the loans are federal or private. If they are federal then there are no statutes of limitation. Sallie Mae, and now Navient, both service federal loans and originate private student loans.
Is it true that Navient cannot take yours house if you into default on a Parent Plus loan?
You would have to be sued by Navient, and a judgment entered in court, before they could put a lien on your home. With a lien, a judgment creditor does not get to take your home per say. You typically would want to resolve the judgment before you sell or refinance the home.
Ok, let’s say there is a lien placed upon my home, as you stated, what does this mean?
That you have to resolve it before you can get financing, or before clean title can be passed to someone you sell it to.
I would just add that the government rarely files lawsuits against defaulted federal loan borrowers – they don’t need to since they can garnish wages, and offset tax returns and offset SSI without ever taking someone to court.
I have seen federal loan lawsuits, but only rarely, and both were in the state of Texas.
Hi Michael and Andrew,
My husband has 4 private loans totaling 28,000. two of them, his dad is a co signer. payments are about 290 a month. We are struggling on paying these. we are current. When he went to school 2005-2009, (now closed as well as the accreditor), he didn’t know the ins and outs of loans and the school did “what was best for him” and didn’t go over details. I noticed falsified information on 3 of the loan applications. Navient, who is the holder, recognized that too, but said sorry, to bad and too late and he signed it. But he wouldn’t of known if it was falsified info anyway. His dad is a veteran and now on disability permanently. He has excellent credit, above 800, and we don’t want that ruined at all. My husband didnt want him on the loans but the school said there was no other way. we are getting ready to by a home, so we can have a home for our family of 5. After purchasing a home, I want to get to a settlement point to get rid of the crappy private loans. What can I do about his dad being on two of them? could i try to refinance or consolidate those somewhere else and then default and settle?
Hi Suzie, I understand the desire to refinance the cosigned loans and then default to settle, but taking out a loan with the intention of defaulting on it could be considered fraud – you’d want to talk with a reputable consumer attorney about this strategy.
Alternately, you could keep paying on the loans that the cosigner is on (either with Navient or with another lender if you’re able to refinance them) and then default on the 3 that aren’t cosigned and settle them.
The difference being that those loans were not taken out with the intention of defaulting to settle them, so it would just be a normal strategic default. Feel free to call in to the hotline and press Option 4 to be referred to me, if you’d like a further consultation.
My daughter had a loan through Sallie Mae/Navient & didn’t pay it so they put it in my name. I am paying the bill which is $129.00 a month. Difficult to pay but I barely manage. They changed it to $240.00 a month which is out of control for me. Can’t manage that payment so now they are charging interest on top of it. Can they do that without my consent?? My credit will go down the tubes if this continues. I am still paying the $129.00 a month. What can I do to stop them?? HELP!!
Is the loan federal or private?
I’ve not heard of Navient or Sallie Mae putting the loan in a parents name if the borrower couldn’t pay. Are you sure this isn’t a federal Parent Plus loan that was taken out in your name originally?
Great article! I came across this page while researching ways to negotiate with Navient. I’ve been paying on my loans for over 13 years and I’ve never missed a payment. I’ve paid off two federal loans and now it’s just the private. As everyone knows the interest and payments are ridiculous. The loan was transferred to Navient at some point…do you think it’s possible to negotiate new terms with them considering I’ve never missed a payment, and on time 100%? Are you aware of any options I might have to help lower this monthly payment? The balance is about $16,000 – I think it started around $30,000 and the interest rate changed a few times etc…any insight or advice you can provide would be great!
Call in to the hotline Amir and get connected with Andrew about resolving your Navient account. You can reach him at 800-939-8357, ext 4.
It seems that the only thing we need to learn here is how to negotiate since it’s well known that private lenders are sharks. It would be nice to settle for 40% of the loan on a 5 year plan considering that more than 50% of any defaulted amount is interest, not principle. It’s a shame too regarding loans that are current which, if I’m reading correctly, doesn’t qualify for negotiations. I’m hard pressed to believe that the billions of dollars navient handles is an actual cash resevoir, bundle or vault; it may be an imaginary number based off of inflated profiles or financial statements. What entity besides Fifth Third Bank, Capitol One or the like invests in this monstrosity? With that said, why didn’t the student loan bubble blow up in sync with the housing market crash? Is it not odd that Sallie Mae or Navient is both lender and collector? Separating itself into 2 entities where they are the bank in one town and a collection agency in another sounds fishy to many. I too dealt with ‘former’ Sallie Mae’s reps off shored in India for a good year before finally asking for an authotized rep in the US, which took them another 2 mos after to put me on the phone with someone in Texas. Now, after defaulting, which was the best option at that time, I got the phone calls from underpaid reps doling out their emotional abuse as they lay out my life’s plan for me so eloquently before giving them some sound advice as well until I met the reps at Emergency Financial Services back in 2014. I settled a payment plan with them after paying 1500 bucks for a low interest plan, got my settlement letter and kept all documentation. After almost 3 yrs of on time payments they decide to close my account without proper notice. It wasn’t a worded letter but a list of check boxes and a hand written note saying ‘call navient’. Combined with the unusual phone calls to friends and family from a location service while my payments were being submitted to discuss my loan, I don’t believe they have the right to discuss loan options with anyone but the borrower and/or co signer. I also have yet to receive any letter from Navient to explain why my loan was first sold off to another party, closed without proper notice or phone call then magically back in the hands of the original lender. Every entity I’ve mentioned has been sued by the dept of education, the military and private civilians since 2006. Another investigative case against Navient has been opened this year for the same old thing. Where too do they get this ‘limitless’ supply of ‘money’ to pay off settlements worth millions? Perhaps that explains the variable interest rate as high as 20%! I’m aware of their aggressiveness but that doesn’t mean they’re untouchable.
Hi EJ, Navient private student loans are definitely problematic. They set aside a certain amount of money to cover losses on unpaid loans (usually smaller ones) or settlements on larger loans, with each batch of loans they originate. For example, in 2013 they set aside over $100m to cover projected losses, but they also originated billions in new private loans that year. And yes, Navient does calculate their interest rates so that they cover any projected losses and still turn a profit. However the majority of their business is in managing their FFEL federal loan portfolio.
It would be great if everyone could learn how to negotiate, but we’ve found that there’s only a small segment of borrowers who can effectively negotiate settlements on their own. It’s the difference between learning how to ride a bike, versus being a professional mountain bike rider for 7 years. All of the combined settlement experiences, and the negotiating persona that is developed, in addition to the technical negotiation skills is not something that is easily replicated or taught. The other debt negotiators we know who have tried to offer “DIY” negotiation courses have struggled with low interest, or people who take the course but still aren’t able to negotiate effectively.
For some people, it makes more sense to hire a professional than attempting it on their own. Usually, I’m able to negotiate a lower settlement for qualified clients than they can get on their own – including my negotiation charge. Negotiation is really only half of the equation though – the other half of the equation is effectively executing the settlement so that there are no problems in the future. This is even more paramount when dealing with a third party debt collector for the settlement. It’s very unlikely that Navient sold your loan, they typically don’t do that. If a third party debt collector is involved, they are most likely just contracted by Navient to collect while Navient still retains ownership of the loan. Unlike the credit card industry, we don’t see a whole lot of buying and selling of private student loan portfolios, with the major exception being a lender known as “The National Collegiate Trust”, or NCT.
Since you have documentation of the payment plan that you did for Navient with the agency, then you could use that in support of your case. I’d recommend opening a case with the Navient Customer Advocate department since there are a lot of moving parts here – they would be most able to sort through what happened and try to resolve it. I think you’ll find that this department is much more professional than the typical Navient customer service agents, or debt collectors. Their phone number is 888 545-4199. That would be the first place I’d start in trying to get this sorted out. Hope this helps!
I need help. While in school I took out private loans as recommended by the financial aid dept after my grades began sinking because personal situations and I lost my financial aid. I wish I would have known the trouble I was getting into. I was even dumber to not switch back to governemt funding once my grades improved. I switched majors a couple of times because I lost interest in the majors I were attempting to pursue. The ending result is my loans have seemingly almost tripled if not have tripled from the original amount to $127,000 all of which is private. The loans are from years I think 6 or 7 years ago and I’m in the AL and not to familiar with the SOL. Its like a revolving door for me I default then do forbearance and repeats. Last thing I tried was the 1% interest rate which wasnt knocking a dent into the loan and hurting my finances. Now Im receiving litigation review letters from Navient and Im scared of losing my home and I cant afford wage granishment. What do you recommend me to do? What are the chances of me being able to get a settlement with a low down payment (because I dont have 50% to pay up front) and monthy payments thats reasonable (because I have to provide and live)? Can they even come for me since they are so old and take my home and wages?
You have a lot going on Ashley. Call in for a consult at 800-939-8357 ext 4. There is a ton to cover and Andrew will be more effective with his feedback when is able to dig into the details.
Hi Ashley, for a private creditor like Navient to take your house they would have to take you to court, win a judgment, get a lien, and then force a sale of the property due to the lien. This is extremely rare in the collection world.
Settlements of 50% or less are possible, but require a significant down payment of at least 30% of the settlement amount, with the rest paid over 12-18 months depending on the term negotiated. The letter you received is sent to everyone at a certain stage of the collection cycle (typically the month before default). It is an empty threat as long as you or a competent negotiator works out a settlement or payment plan within 1-3 months of assignment to a collection attorney licensed in your state. Feel free to call in for a further consult.
Hi there, I have 4 private loans with Sallie Mae, now Navient from 2006 and later. My co-signer filed for bankruptcy on 3 of 4 of the loans at one point, but the loans were not discharged and they started trying to collect from me again. Once the 3 loans came back into repayment status, the payments more than quadrupled and they got way too hard to handle. I’m late by about five months now. Just got a certified letter regarding “litigation”. and am very worried. Will they actually take me to court at this point?
My ultimate goal is to settle for ten percent. With private student loans from Navient, how many months into default is the best month to try and settle at the lowest percentage? Also, when you say “a 50% settlement rate”, is that just on the principle loan amount, or does it include all fees and interest? I know someone who settled for 10%. Is that possible for me? Thank you!
Navient is going to handle each account individually. Your friend was likely late enough with payments (years of default and passed the state SOL to sue), and that is what helped him/her settle that low. It is just not common to settle that low, even when everything is aligned to suggest you shoot that low.
Call in for a phone consult at 800-939-8357 ext 4. There is a great deal to cover to determine what is possible when settling your Navient loans.
Agreed with Michael, the only time Navient takes a 10% or less settlement is in a situation when they couldn’t collect on the loans anyway (whether they are past the state SOL, credit reporting limits, or both).
Typical Navient settlements range from 30-50% depending on when the default occurred and the effort put into negotiations.
Okay so this site seems like a good place to get my question answered. I received a call today from a debt collector in regards to a settlement offer from Navient. My 4 student loans total about 20,000 and they are willing to settle for 6,024 as long as I can come up with the money within the next week or so. It would be classified as settled in full. However, if I do this am I going to be receiving a 1099-C for the 14,000 and then have to pay the 30% tax on it. Either way I understand that it’s a good deal and going to save me a lot of money I just want to make sure that I understand exactly how this works. When I called the debt collector back about it they said no that I would not receive a 1099 C and that the only money I would have to pay total would be the 6024. I was going to call Navient tomorrow to verify this and then get written confirmation before proceeding but it seems like someone on here may be able to answer my question.
How long have your private loans been in default? What state do you live in?
You do want everything in writing before you pay a penny.
DO not listen to the debt collector about you not getting a 1099c on forgiven debt. They will have nothing to do with whither Navient sends you the 1099. And you should expect to get one. Read that link about getting a 1099. Not everyone ends up owing taxes on cancelled debt.
Are you in a 30% tax bracket? If you do end up owing tax, it will be at your tax rate, not a default 30%.
You also may want to structure your settlement with Navient in a manner that puts your lump sum payment in January, which buys you an extra year to save up to pay any tax you could owe on the 14k saved.
Michael is preaching the gospel truth on debt settlement here. Debt collectors are not working on your behalf, they are working against you; and they regulary lie (which is why their industry has over 100,000 complaints each year).
Two main things here: – check your default dates and possibly talk to a reputable consumer defense attorney in your state to see if you’re past SOL.. Secondly, talk with a licensed CPA since no debt collector is licensed to give valid tax advice. Then make a decision to accept the settlement (or try to negotiate a lower one) based on that.
My daughter is still enrolled in school and Navient is telling her that she can no longer defer her loans. Not sure why. Is there a time limit on loans while you are in school?
For private loans with Navient, sometimes their forbearance or deferment runs out before the student completes their degree – unlike federal loans which have a 6 month grace period.
What would our options be to change this. They are not very nice people to talk to, very nasty on the phone and bully you. Not sure how they get away with that.
Yes they can be very nasty on the phone with borrowers unfortunately. They receive quite a few complaints due to that.
I don’t know of any options to change or extend the forbearance/deferment on a private loan. I think the main options at this point would be beginning repayment, or possible strategic default to settle.
Like many of the previous comments, I have been paying on my private student loans regularly over the last several years and the balance owed has gone no where.. My credit score was starting to rehab from a filed bankruptcy 3 1/2 years ago, but then I came off Navient’s rate reduction program and unable to reapply. With the monthly payments too much to afford and already living paycheck to paycheck, I’ve been trying to bide my time with paying what I could until I could reapply for the rate reduction program and get payments affordable again. However, they’ve reported my account as past due to the credit bureaus and now my credit score is starting to take a nose dive again. I’ve read through a lot of the comments and even watched the interview that was posted with Andrew. What can I expect if I decide to go the route of not paying them back and start to save for a settlement? I feel like that is an inevitable outcome for me and I would rather start the process of healing my credit score now instead of 5 years from now.
Andrew will provide his feedback, but for my part, I would be geared toward settling your private loans with Navient if it were me. I can see a far clearer path to financial viability, and credit report recovery too, by settling.
Hi Josh, I wrote an in-depth article about strategic default here: https://www.mycreditcounselor.net/should-i-strategically-default-to-settle-private-student-loans/
But in general, Navient will default the account between 6-7 months past due, at which point negotiations begin. Navient settlements tend to be between 40-50% on a recent default (keep in mind your balance may increase by up to 10% during a strategic default).
Structured settlements are available between 12-18 months with a down payment that is at least one third of the settlement amount. However, these carry more risk than a lump sum settlement because one missed payment can void the entire settlement. Also, better deals are usually achieved when negotiating with a lump sum settlement.
During the strategic default, expect a lot of phone calls and letters to you and any cosigners. I advise clients who choose to go this route to ignore the calls until the default occurs and I begin negotiations. The calls prior to default are meaningless if you intend to settle, since Navient will not go below 85-90% on a settlement until the accounts have become a non-performing asset for them (which happens when they default).
I am just finding out when trying to purchase a house recently that I have a student loan through navient that is showing as a charge off, just wondering what I can do from this point to correct this.
Is the loan federal or private? You can get back on track with federal student loans over a period of months so that your home loan can go through. If the loan with Navient is private, it is often ideal to offer a lump sum settlement for less. This will provide the most savings and quickest path to getting your credit reports updated, if the lender is requiring that in order to fund your mortgage.
Hi Jacqueline, I’m betting that this is a private loan and settlement is probably the best way to deal with it as Michael mentioned.
Doing payments on a charged off private loan usually doesn’t cure the charge-off and it will remain in a negative status until paid in full or settled.
Hey guys,
I have been paying on my student loans off and on for 8 years now. It’s been a struggle coming with the money to pay them on a monthly basis. So many times I would be on a interest only payments plan that did nothing for me. My credit is destroyed and my loans ballooned from 100k to 210k as of right now. My job is tied to the gas industry in wyoming and has been severely effected. My family five lives at pay check to pay check.
Not sure if I could settle the debt without bein able to make affordable payments. Right now I’m in default and they are sending litigation threats to me. I feel like I can’t afford to live and I can’t afford to die. Any help would be greatly appreciated
Thanks
Call in for a consult so that we can dig into the details of your situation Robert. You can reach Andrew at 800-939-8357, ext 4.
Hi Robert, we would need some more information – are the loans federal or private? Who’s the lender or servicer? An interest only payment plan sounds like a Navient private loan to me.. as does threats of litigation while in default. On a larger private loan balance, litigation is a strong possibility if no settlement or payment arrangements are made.
Feel free to call the number Michael mentioned to be connected with my office for an appointment.
My mom is consigner on my loan. Somehow she is listed as borrower and I as consigner. We have both spoken to Navient about this and have been told they cannot correct it. I believe I read somewhere that if I were to settle a student loan for less than I owe it could affect my taxes. I am worried if I were to make a settlement agreement it would negatively impact my mother’s taxes as she is listed as the borrower. Is that the case?
Check out this article about taxes on cancelled or forgiven debt. It is a legitimate concern. Talk to a tax pro, but both of you cannot owe tax on the same cancelled debt. You could cover the tax impact for her without wading into loan origination complications.
What is the balance owed today?
After reading my linked article, would one or both of you qualify for submitting IRS form 982? If you are, and she isn’t, and the amount of tax at issue is meaningful, let me know. Assume a 60% savings on the Navient balance and the current tax rate that is already being paid by you or her.
What I have been told by creditors is that the person the payment is coming from is likely to have the 1099 issued to them. As Michael said, they can’t issue a 1099 to both of you for the same debt. I generally try to have settlement payments in these situations come from (or look like they are coming from) the borrower directly. In your case, you may want to have the payment come from you in your name, so you are the one who receives the 1099. Generally younger people are more likely to qualify for insolvency exemptions since they haven’t had as much time to accumulate assets. Michael discusses this further in his article here: https://consumerrecoverynetwork.com/debt-forgiveness-taxes-settled-credit-card/
For a definite answer I would contact Navient and possibly even three-way a call with your CPA, since they are the only one who can give definitive licensed tax advice.
Navient’s general customer service department probably isn’t up to par for this kind of questions, so I’d recommend opening a case with Navient Customer Advocate, sort of specialized Navient Customer Service department staffed by competent agents. You can reach them at 888) 545-4199. Diana, Jessie, and Chuck are my favorite agents to work with there.
Hello Michael and Andrew,
I have a private student loan with sallie mae/navient that either defaulted in 2011 or 2012. Navient reported on my credit report on 4/30/13 that: charged off as bad debt – profit and loss write off.
I have not heard from them in years, then all of a sudden I get a call from a collection company wanting to offer me a settlement, I called them back and they stated my full debt was $9370.00
What is the statute of limitations in Missouri? Can they try to collect this debt from me almost 4 years later after they wrote it off as a bad debt?
My husband and I also had to file bankruptcy in 2014 and was discharged in July of 2014. I honestly don’t know what to do because the people at sallie mae are horrible to work with, they are extremely rude. Thank you for any help you can offer!
You are reading more into the write off (often referred to as charge off) than applies. It is just an accounting requirement.
They still have a few years to sue you on a written contract in Missouri.
I would look at pulling the money together to settle. Call in and talk to Andrew at 800-939-8357 ext 2.
Hi, I just graduated college with some hefty private loans. It’s a long story why it cost so much, I was depressed, young and stupid.
Anyways, I have two loans through sallie Mae. One for 9,500 at 5 percent interest. And another at 22,000 at 7 percent interest. I’ve been very stressed by these loans and not sure what to do. I work as a substitute teacher 5 days a week and don’t make very much money. It’s not like I’m giving up so early, but I want to see what my options are while I am young (23.)
Shitty cause I thought I’d go to grad school but unfortunately I’m too indebted. I currently have a decent chunk of cash. Will sallie mae work with me?
A cousin of mine works for Navient and she said threatening default is always an option. Thanks
Threatening default typically means nothing to loan servicers. You actually have to default for them to take a look at alternative resolutions with you. You can settle with Navient after you loan goes unpaid for several months.
If you are seriously looking at the option of negotiating a low lump sum pay off with Navient, call in and talk to Andrew at 800-939-8357 ext 4.
Hello,
Andrew or Michael,
I have 3 Navient Private Loans and my dad is a co-signer which are all current. I am trying to pay them off with some bonus money pretty soon. I have about 23K and paid about 3k with in the last week. I feel like I will never get a chance to pay all of this off when I have about 185K of private and government loans. Will Navient settle with me if I am good standing for less than what I owe?
I have 23k left to pay total for the 3 loans.
Navient does settle private student loans. Fill out the consultation request from (request consult tab at top of page). Andrew will get that and set up a time to go over your situation with you on the phone.
Hi Christina, Navient does settle as Michael mentioned, but the loans have to be in default for them to settle for a significant reduction. It can be possible to get a 5-10% reduction when you’re current on Navient private loans, but it’s not easy.
However, for the 50% or larger reductions on the balance, they will only do that after the accounts have defaulted; and even then negotiations usually take 1-3 months in order to get them to accept a settlement.
Also, if the majority of your loans are federal be sure to check out the different payment plans for those at http://www.studentloans.gov.
Hello Michael,
I took out Sallie Mae loans in 2001 and have been unable to make a payments since 2008. The loans have come off my credit report but I just received a letter from a collection agency representing Navient. I’m in a position to make affordable payments and would like to work on settling my debt. What options do I have? If I start to make payments with the collection agency, will this appear on my credit report? I went to school in New York City.
What type of loans are you dealing with, federal, or private?
I’m am dealing with private loans
Call in for a consult about dealing with these loans at 800-939-8357 ext 4.
Hello Michael! I have a private loan through Navient that has been charged off on my credit report but reported to collections. The loan was opened in 2007. Should I pay collections?
When was the loan set to start repayment? When did you last make a payment on the loan? What state are you in?
Kesha, it may be possible to settle this loan through negotiations for less than 50% of the balance. Feel free to call in and request Option 4 to do a free consultation.
Hi Andrew and MIchael,
I have a quick question I wanted to run by you guys. I have 3 private loans with Navient that defaulted Oct 31st. I called Navient today and talked to my “case manager” who stated she has just received my information and we talked about what I can do regarding my defaulted loans. I have a co-signer (my father) on these loans, and I prefer he pays nothing because he really doesn’t have the money either. Navient offered to settle where I pay 20% of my 13,000 plus defaulted loans which is around 3,600 plus, my case manager said that she can post date until Nov 30th, then it will be $269 per month after the initial payment.
My question is, I asked her if that 20% can be less but she made it seem that it was my only option, subtly threatening faxing where my father works, etc…
In your opinion is this a good deal?
Paying 20 percent to settle your Navient student loans is a good outcome. Navient accepting monthly payments on that amount is even more attractive (if I understand the offer right). Get everything in writing from them before you pay anything. If it were me I would want to pay this off in one payment if at all possible.
Hi Aina, I think the main question here: is the 20% a down payment on a payment plan, or is it the entire settlement?
If you’re just paying 20% down and then $269 per month until the loans are paid in full, then that is just the equivalent of a payment plan with a large down payment. Since defaulted Navient private loans can be settled for 40-50% through negotiations, paying 100% of a defaulted Navient private loan is not a very good deal (but, would look better on your credit than a partial settlement).
A 20% overall settlement is very good on private loans, but is rare and usually only occurs when loans have been defaulted for several years. If you’re still speaking with Navient directly, it sounds like these may have recently defaulted; and to me it sounds like they are just asking you
to pay the full balance with a large down payment (which they are known to ask for first).
Hi Andrew,
Yes it recently defaulted Oct 31st.
The case manager from Navient offered me 3 choices: 1. Pay 13,000 plus out of my 18,000 defaulted loans and be done with it. 2. Pay 8,000 to take my father off as co signer and pay the rest of the loans with a monthly payment. or 3. Pay 20% which is 3,500 at the end of the month then pay monthly of 269 to pay the rest of the loan.
She gave me those 3 choices, and she was good at slightly threatening my co signer (my father) regarding his job and his house. I will be speaking to her again regarding my choice, which right now will have to be choice #3. I don’t have the money now to pay anything bigger so #3 is seeming like a good choice.
Hi Aina, you have other choices than what this collector offered. We regularly settle Navient private loans for 40-50% of the balance, often available in a structured settlement with 2o% down. What they are presenting you with is their opening offer in a negotiation, not 3 hard and fast choices – I think it’s important to keep that in mind when dealing with Navient private loans that become defaulted.
There is also a low interest payment plan available which does not require a large down payment. This is available to all defaulted Navient private loan borrowers, which I know for a fact.
The important thing to keep in mind here is that this collection agent is trying to bully you into paying a large lump sum.
Navient cannot take your father’s house or do anything to his job. It would require a lawsuit for them to attempt to garnish wages, and a lawsuit would have to be done by a collection attorney in the same state as the borrower or cosigner. This rarely happens, and there are plenty of opportunities to settle or do a payment plan before that.
It’s sort of a one sided negotiation when you’re being bullied and intimidated with false threats. I’d recommend talking to a professional negotiator (to speak with me, call the debt relief hotline and press Option 4) or a reputable consumer defense attorney.
If Navient sends a fax to someone’s workplace regarding a private loan, it’s nothing more than a voluntary request for financial information – you can throw it in the trash. If you’re dealing with Navient Internal Recovery, which it definitely sounds like, I have negotiated directly with the manager there multiple times. The front line agents like you’re speaking with are known to be aggressive, rude, and intimidating in order to bring in as much cash as they can for themselves and for Navient (they receive a commission on collections which is why this person is falsely presenting 3 options that all involve a lump sum).
Short of getting a professional involved, I would be adamant about standing up for yourself and requesting the low interest rate payment plan; and not accepting any of the 3 “options” they presented to you.
This is a good example of how it can be difficult to negotiate with a private lender on your own though. Feel free to give us a call if you’d like a more in depth consultation.