Can my wages be garnished for a student loan?
Author: tkl1200
Joined: 25 Feb 2005
Posts: 1
Posted: Thu Mar 03, 2005 1:51 am
Post subject: Student Loan Garnishment question
Hi, i have a question and any help will be apprecated. I have a student loan through SLM financial which is what i believe to be a private loan, i had to get approved in order to get it. Anyhow, I couldnt afford to make payments on it anymore and its now been about a year since my last payment. The amount of the loan was $7,500 and i guess with late fees and other charges it is now at $10,500. They turned it over to a collection agency who called my work the other day and spoke to the payroll specialist in HR. She told me that they had called her and told her to tell me to call them to make payment arrangements or else they will send her the paperwork to garnish my wages. She then advised me to call them because she said if they garnish my wages there's no telling how much they'll take out of my check. Anyhow, what my question is...first off I live in Texas and i heard they cant garnish wages....and secondly since it is NOT a government/ federal loan ....Can they still garnish my wages? I feel like they just called threatening garnishment in hope to scare me into paying. It is my understanding that Sallie Mae now handles 2 types of loans...Well i have 1 loan that was based on my credit and other student loans that were governmental loans.....I'm just wandering since their both coming from sallie mae is there any chance for trouble with the student loans i currently use for school?
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Author: NightStar
Board Monitor
Joined: 07 Nov 2003
Posts: 2634
Location: Illinois
Posted: Thu Mar 03, 2005 9:42 am
That is a hard one, Texas law does show not to be a garnishment state, if it is not federal, then they should not have any special treatment over other creditors to forcing garnishment.
But on the other hand you said you did have existing governemnt loans, for speculation purposes, that you think they might use to collect the other debt on.
It is very possible that they mis represent one account to be another to gain advantage on collection efforts, I have seen that first hand before, not with a student loan company but I have seen it happen.
I really think you are going to need the services of an attorney on this one, just to cover your basis. Get together all documentation on this account that you can. They should have to take you to court before they can accomplish garnishment, that is where you want to show what they are trying to do.
There are a few angles to this problem, yes it could hurt existing loans, companies can hold that against you, they could insist that you pay back student loans before granting further future loans to you. That is always a possibility.
Also on the other hand, student loans will follow you forever if unpaid... meaning that they can continue to report to the bureau indefinitely. There is no 7 year expiration to the account, the FCRA just acknowledged the student loan act, and made allowances this year to fix that to allow continual reporting.
This is about all I know on this subject, may may beat them out on being able to collect, but they are with other means to be a hinderance in your continued education.
Best Regards,
Pammila Phillis
Board Monitor
U.S. Citizens for Fair Credit Card Terms, Inc.
http://www.cardratings.com
501-663-0314 PH
501-663-0033 FX
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Author: Ira
SENIOR MEMBER (Member for 2 yrs.+)
Joined: 19 May 2003
Posts: 839
Location: NJ
Posted: Thu Mar 03, 2005 4:50 pm
In North Carolina, Texas, South Carolina and Pennsylvania, wages may not be garnished to pay consumer debt. Other debts, such as child support, student loans and IRS debt can be garnished. On these debts, you will receive formal notification before any garnishment can be instituted.
No one can garnish your wages without court action. You will receive notice of any court action to be taken against you and you will have the right to defend yourself in court. In states where garnishment is legal, there is normally a limitation of 20% to 25% of net resources or disposable income. Your employer should be made aware of this if they are not already knowledgable in this area. You might want to tell them that to date there have been no court proceedings, so there can be no action taken.
If they truly come after you, you'll really have to get legal advice to determine your best course of action.
Do not let what you cannot do interfere with what you can do.
Ira
View our latest credit card ratings!
Joined: 25 Feb 2005
Posts: 1
Posted: Thu Mar 03, 2005 1:51 am
Post subject: Student Loan Garnishment question
Hi, i have a question and any help will be apprecated. I have a student loan through SLM financial which is what i believe to be a private loan, i had to get approved in order to get it. Anyhow, I couldnt afford to make payments on it anymore and its now been about a year since my last payment. The amount of the loan was $7,500 and i guess with late fees and other charges it is now at $10,500. They turned it over to a collection agency who called my work the other day and spoke to the payroll specialist in HR. She told me that they had called her and told her to tell me to call them to make payment arrangements or else they will send her the paperwork to garnish my wages. She then advised me to call them because she said if they garnish my wages there's no telling how much they'll take out of my check. Anyhow, what my question is...first off I live in Texas and i heard they cant garnish wages....and secondly since it is NOT a government/ federal loan ....Can they still garnish my wages? I feel like they just called threatening garnishment in hope to scare me into paying. It is my understanding that Sallie Mae now handles 2 types of loans...Well i have 1 loan that was based on my credit and other student loans that were governmental loans.....I'm just wandering since their both coming from sallie mae is there any chance for trouble with the student loans i currently use for school?
View our latest credit card ratings!
Author: NightStar
Board Monitor
Joined: 07 Nov 2003
Posts: 2634
Location: Illinois
Posted: Thu Mar 03, 2005 9:42 am
That is a hard one, Texas law does show not to be a garnishment state, if it is not federal, then they should not have any special treatment over other creditors to forcing garnishment.
But on the other hand you said you did have existing governemnt loans, for speculation purposes, that you think they might use to collect the other debt on.
It is very possible that they mis represent one account to be another to gain advantage on collection efforts, I have seen that first hand before, not with a student loan company but I have seen it happen.
I really think you are going to need the services of an attorney on this one, just to cover your basis. Get together all documentation on this account that you can. They should have to take you to court before they can accomplish garnishment, that is where you want to show what they are trying to do.
There are a few angles to this problem, yes it could hurt existing loans, companies can hold that against you, they could insist that you pay back student loans before granting further future loans to you. That is always a possibility.
Also on the other hand, student loans will follow you forever if unpaid... meaning that they can continue to report to the bureau indefinitely. There is no 7 year expiration to the account, the FCRA just acknowledged the student loan act, and made allowances this year to fix that to allow continual reporting.
This is about all I know on this subject, may may beat them out on being able to collect, but they are with other means to be a hinderance in your continued education.
Best Regards,
Pammila Phillis
Board Monitor
U.S. Citizens for Fair Credit Card Terms, Inc.
http://www.cardratings.com
501-663-0314 PH
501-663-0033 FX
View our latest credit card ratings!
Author: Ira
SENIOR MEMBER (Member for 2 yrs.+)
Joined: 19 May 2003
Posts: 839
Location: NJ
Posted: Thu Mar 03, 2005 4:50 pm
In North Carolina, Texas, South Carolina and Pennsylvania, wages may not be garnished to pay consumer debt. Other debts, such as child support, student loans and IRS debt can be garnished. On these debts, you will receive formal notification before any garnishment can be instituted.
No one can garnish your wages without court action. You will receive notice of any court action to be taken against you and you will have the right to defend yourself in court. In states where garnishment is legal, there is normally a limitation of 20% to 25% of net resources or disposable income. Your employer should be made aware of this if they are not already knowledgable in this area. You might want to tell them that to date there have been no court proceedings, so there can be no action taken.
If they truly come after you, you'll really have to get legal advice to determine your best course of action.
Do not let what you cannot do interfere with what you can do.
Ira
View our latest credit card ratings!
posted by CardRatings.com at 5:56 PM
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