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Can a collection agency for a student loan take your tax return?
Wiki User
∙ 14y ago
In the USA, if your Federal Student Loans are in default, then your original lender was paid 97% of your loan value by a Federal Guarantee Agency. Guarantee Agencies are basically insurance companies. When your lender was paid off, the Guarantee Agency took ownership of your loans. Guarantee Agencies have the right by law to keep any Federal Income Tax return money that is owed to you. They also have the right to garnish any wages and to garnish Social Security benefits. If you need help getting out of default and getting off of the tax offset list, click on my profile, StudentLoaner, below.
Wiki User
∙ 14y ago
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A student loan has been in default will collection agency still garnish tax return?
If it was a federal student loan, then yes, the collections agency could take your income tax return money. If it was a non-federal loan, then they would not be able. Secondly, federal student loans are can not be discharged, the US always gets paid even when laws are created for private businesses that disallow the same right of collections.
Can a collection agency put a lien on your federal tax refund?
Most definitely for almost any loan. If it is a student loan, you can count on it.
If you owed student loan money from Sallie Mae and it is now turned over to a collection agency can I be garnished?
Yes! If your student loans are with a collection agency they are in default. When student loans are in default the dept. of ed gives the collection agencies "CARTE BLANCHE" to collect the money by any means necessary. Wage garnishnent is only one.
Can the collection agency touch your bank account if your student loan is in default?
A collection agency can only touch a bank account if you either give them permission or they have a court order. In order to get a court order they have to go through the full legal process including trial. The Student Loan on the other hand, like the IRS, does not have to go through the legal process.
What kind of agency is The Student Loan People?
The Student Loan People is an agency that specializes in student loans. They are located in Kentucky. They work with people getting student loans, collections and repayments of student loans.
Can a collection agency of a federal student loan refuse a payment that is affordable for the person?
You have a right to file a hardship document for any true federal student loan, this does not include private or commercial substitutes to federal loans. However, expect that your tax return should match what you claim is income, and what you might consider your affordability may not be considered acceptable unless you are impoverished.
What are the penalties for not making a student loan payment on time?
Penalties you can face when not paying your student loan payment on time are late fees, if a loan is turned over to a collection agency you can incur collection fees. You are also reported to the credit bureaus which can adversely affect your credit rating, in some cases causing you to have difficulty obtaining credit for purchases such as a car or home or other financial loans.
How do you find out if your student loan has gone to collection?
The collector will write you a letter.
What Happens If I Don't Repay My Federal Student Loan?
Many students use federal student loans to pay for their college education. However, some students have a difficult time repaying their student loan debt once they graduate from college. If you borrow money for school, you definitely have to pay it back. If you do not repay your student loan, then you can face serious problems. Read on to learn how a past due federal student loan debt can affect your future.Negative Credit HistoryIf you fail to repay your student loan according to the terms and conditions outlined by the lender, then you will be in default. If you default on a student loan, the lender may report this information to the major credit bureaus (TransUnion, Equifax, and Experian), which can damage your credit history. Having a defaulted student loan on your credit report can make it difficult for you to obtain credit in the future from another lender or financial institution. In addition, a defaulted student loan may remain on your credit history for up to seven years.Collection AgencyIf you default on your federal student loan, the lender may send your account to a collection agency. So, in addition to repaying your student loan debt, you will also be responsible for paying collection fees and possibly other penalties, such as late fees. The collection agency may also report your past due account to the major credit bureaus. Therefore, you will have another negative item appearing on your credit report (one item from the lender and one item from the collection agency).LawsuitThe lender or collection agency may choose to file a lawsuit against you and take you to court for your unpaid student loan debt. If the lender or collection agency wins the lawsuit, they will receive a judgment against you, which may allow them to garnish your wages from your paycheck, or freeze your bank account. In addition, the government can garnish your income tax return, in order to repay your federal student loan debt. Please note that a judgment can appear on your credit report under the public records section. This type of negative information can harm your credit history.No More Financial AssistanceIf you default on your student loan, you will be ineligible to receive any type of federal financial aid in the future to pay for your college education. However, if you repay your federal student loan, (or work out a payment arrangement with the lender) you may qualify for financial aid again in the future.As you can see a defaulted student loan can cause severe consequences for a student. Therefore, it is important to make your student loan payments according on time. If you are having difficulty repaying your federal student loan debt, contact your lender as soon as possible to discuss your repayment options. The lender may adjust your repayment schedule to suit your financial needs. In addition, you may qualify for a deferment or forbearance, which will temporarily suspend your payments for a certain amount of time. Please note that if you qualify for a forbearance, interest will continue to accrue on your student loan during this time period. By all means try to repay your student loan debt in a timely manner.
Do you have to be sued before a student loan can be withheld from a tax return?
No
Can a collection agency take possession of a vehicle in Maryland?
If your vehicle is the collateral for the loan, then yes.
Can a collection agency go after a student when the original 1998 unsecured non-governmental student loan was discharged through a parent's Chapter 7 bankruptcy?
Yes, if the student signed the loan papers too. Just because the parents took the loan down thru the Bankruptcy doesn't mean the student loan doesn't have to be paid if there were other signers responsible. Everyone signed on the papers would have had to gone Bankruptcy in order not to pay it. * They can pursue collection if you were a legal adult and signed the agreement. However, it is more than likely that the SOL for the loan has expired and therefore the collector would not be able to pursue litigation. They can continue to employ regular collection methods unless they receive a "cease and desist" letter from the alledged debtor.
