My Student Loan Was Consolidated But I’m Still Being Garnished

By on March 9, 2018

Question:

Dear Steve,

In September of 2016, I had a defaulted student loan that went into wage garnishment. At the time of garnishment, I owed approximately $5000 and additional $2000 in fees and interest for a total of $7000. When the garnishment started I decided to let it go assuming it would be paid in full in 16-18 months. In December 2017, I applied for a loan consolidation for other student loans I had that were not in default. After checking in to all of this, I found that ACS/the agency garnishing my wages stated that I still owed $7000, when at the time they had already garnished over $7300 from my wages. How is this possible? How is this legal? Where do I go for help or answers? When I spoke with ACS about this, they sent me file that listed every garnishment and date. Each garnishment was approximately $250 and It appears that approximately $50 of each went towards interest and fees and $200 went towards principal. However, the balance never decreased.

To add insult to injury, I had to add the full amount to the consolidation. They were paid in full on 2/22/18 and have continued to garnish 2 paychecks since that time.

I Never received any notice other than an initial letter informing me of the garnishment. They should send something informing that regardless of how much money they receive, the loan will never be paid.

Thanks in advance.

Paul

Answer:

Dear Paul,

Without looking at an accounting for your loans it would be impossible for me to guess how your payments are being applied. It is a mystery how the defaulted loans could be added to an existing consolidation. That would not be possible without having the loans out of default and consolidated into a new loan.

So it sounds as if the defaulted loans are still in default and that would explain the continued garnishment.

READ  Is There Any Hope to Stop a Student Loan Wage Garnishment?

I’m curious if you have explored rehabilitating your defaulted loans so your wage garnishment would stop after five payments and you would be eligible to consolidate those loans out of default and get a lower payment?

If you don’t know about rehabilitation, .

You can also login to the and look at how your defaulted loans are being reported.

morehelp1
Choice1 Choice3 Big Hug!
Euro-Video - , ,
If you have a credit or debt question you'd like to ask just use the online form .

Last step, fill out the information below or call us for Priority Assistance.

What problems are you having with your report?

Your first name is required. Your first name is required to be at least 2 characters. Your first name cannot be longer than 50 characters.
Your last name is required. Your last name is required to be at least 2 characters. Your last name cannot be longer than 50 characters.
Your email is required.
Your phone is required. Your 10 digit phone number is required.
Your state is required.
Your age is required. Your age must be greater than 18. Your age must be less than 100.

By clicking on the "Contact Me" button above, you consent, acknowledge, and agree to the following: Our Terms of Use and Privacy Policy and to receive electronic communications. We take your privacy seriously. That you are providing express "written" consent for Debt.com or appropriate service provider(s) to call you (including through automated means; e.g. autodialing, text and pre-recorded messaging) via telephone, mobile device (including SMS and MMS - charges may apply), even if your telephone number is currently listed on any internal, corporate, state or federal Do-Not-Call list. Consent is not required as a condition to utilize Debt.com services and you are under no obligation to purchase anything.

By clicking on the “Contact me” button above, you consent, acknowledge, and agree to the following: (1)That you are providing express “written” consent for Lexington Law Firm, Debt.com or appropriate service provider(s) to call you (including through automated means; e.g. autodialing, text and pre-recorded messaging) via telephone, mobile device (including SMS and MMS – charges may apply), or dialed manually, at my residential or cellular number, even if your telephone number is currently listed on any internal, corporate, state or federal Do-Not-Call list; and (2)Lexington Law’s and and Debt.com’s Terms of Use and Privacy Policy. Consent is not required as a condition to utilize Lexington Law or Debt.com services and you are under no obligation to purchase anything.

About Steve Rhode

Steve Rhode is the Euro-Video and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

One Comment

  1. Paul

    March 9, 2018 at 2:22 pm

    Asked question about student loan wage garnishment.

Share a Comment / Leave a Reply

%d bloggers like this: