Student Loan Wage Garnishment Help Is Available
Have you defaulted on your student loan and are being threatened of wage garnishment? Student loan wage garnishment can be a very painful and stressing experience for anybody. When your very earnings are taken away, you feel angry, confused and pained. Paying rent and bills becomes a cause for stress and you wonder how you’d survive with a portion of your paycheck going to the loan collection agency every month.
Who Can Garnish Your Wages for Student Loans?
When faced with student loan wage garnishment, most people wonder and ask if it is legal for loan servicers to collect a certain percentage of the borrower’s income directly from the employer. The answer is ‘Yes’, it is legal. As far as federal student loan wage garnishment laws are concerned, if you fail to make payment for 270 days, your loans enter default status and the creditor is entitled to pursue wage garnishment in order to recover the due amount.
How much of wages can student lenders garnish?
Student loan servicers and their agents can collect up to 15 percent of your disposable monthly income. That can add up to a significant amount and seriously affect your financial lifestyle. However, you must receive a notice at least 30 days before the wage garnishment is supposed to begin, along with your rights to question and contest the garnishment.
If this is happening to you, now is the time to take action. Keep reading to find out what you should do.
Ways to Avoid or Stop Wage Garnishment
If you have received a call from a loan collecting agency threatening for wage garnishment or if you have received a notice notifying the beginning of wage garnishment, you need not fret and worry right away. Federal student loan wage garnishment may be legal but it doesn’t mean it can’t be stopped or avoided. Even if you are already experiencing wage garnishment, you can stop it.
The best way to do it is to get in touch with your loan servicer immediately. You can rehabilitate your loan if you have defaulted for the first time. In order to get out of default and rehabilitate your loan, you must pay nine consecutive loan payments on time. The installment amount for these 9 months will depend on your income and expenses and you can negotiate for an amount which is ‘reasonable and affordable’. Once your loan has been rehabilitated, you can choose from among the available repayment options to pay back your pending loan amount.
You can resolve your defaulted student loans much faster under certain circumstances and avoid the long delay of rehabilitation. If you have federal student loans you can consolidate them by taking advantage of available government programs. Consolidation will restore your status to good standing, reduce payments so that they are in line with your income, and stop or avoid student loan wage garnishment.
Talking to your loan servicer or the collection officer may prove very frustrating as loan servicers and collection agencies want to go for wage garnishment instead of letting you explore other options. The truth is it is financially in their best interest to lock you into a garnishment which guarantees payments directly from your paycheck to them and allows them to collect higher interest and fees. You will have to be patient and persistent. Know your rights well and act in accordance with them.
Direct Student Aid to Your Rescue
Direct Student Aid provides federal student loan wage garnishment. Our mission is to educate borrowers on their options and simplify the application process to take part in government programs. Direct Student Aid can help you avoid and stop student loan wage garnishment by applying for government student loan consolidation. If you qualify you can be out of default in 90 days or less, with a payment you can afford, and not have to worry about your paycheck being garnished. Call today to find out how we can help you specifically.