$107,000 in sallie mae loans

Posted by EqualExtreme7876@reddit | studentloandefaulters | View on Reddit | 16 comments

Hey all Sallie Mae is trying to charge me $1,500 a month to pay student loans which is insane. I’ve called for weeks trying to negotiate or be put on a different plan or forbearance but they tell me i have no options. I stumbled upon the default strategy. I live in SC and out SOL is 3 years, they also can’t garnish wages here. I’m 23 and the only asset to my name is my car. How likely is it they would come after me and sue me?

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Odd_Investigator_736@reddit

Your likelihood of being sued really depends on how much they know about you and your ability/inability to pay; they and/or their attorneys would assess whether it's a worthy pursuit. What matters is their assessment of you and not at all your assessment of yourself. It can get tricky because if you try pleading and asserting to them that you can't pay, you're just resetting your SOL and buying them time to sue.

In all honesty, those who have ran out their SOL and managed to not get sued probably had favorable conditions, such as not having assets in their names, having employers in states that could not be garnished, and perhaps even kept Sallie Mae from knowing too much about them. Please know that is not an easy alignment of stars to accomplish, and strategic defaulting should not be to solely hope you don't get sued, but rather to perhaps be able to wait long enough for a good settlement offer that perhaps you can pay and do away with this debt.

I'm no lawyer, but I would advise trying to settle before pushing your luck on the hope of not getting sued (and when I say try to settle, I mean wait for them to make an acceptable offer to you rather than trying to negotiate). And I would also advise finding a good lawyer who handles these issues too. You can probably start with a free 30 to 60 minute consult and get very useful legal advice to help inform your decision of how to go about this.

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FJB444@reddit

What is the SOL?

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Odd_Investigator_736@reddit

Statute of limitations... the length of time a lender has to sue a defaulted borrower before they legally can not any longer. There have been people lucky enough to see their SOL run out and they pretty much get away with not having to pay the debt at all anymore.

The debt still exists as time-barred debt, and collections agencies may still try to collect with harassing bluffs, but it would eventually fall off one's credit report and that debt can not be collected from one's estate after they pass (I think, not 100% sure on that one though).

This only applies to private student loans. Not federal.

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Putrid_Factor_2660@reddit

Hello there u/Odd_Investigator_736 can I dm you, I have a question.

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Odd_Investigator_736@reddit

Sure.

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EqualExtreme7876@reddit (OP)

what would you say a good settlement would be on a $107,000 loan? Again i’m 23 so i don’t know much about this kind of stuff

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shuttheduckup123@reddit

I’d say good is 20-50% of the loan amount. But you’ll typically need to have that money ready to give over.

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Odd_Investigator_736@reddit

I agree here. I don't know how much the borrowed amount was, considering this probably inflated with interest by now, but if you can make it so you're paying less than what you borrowed, that's a win there.

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EqualExtreme7876@reddit (OP)

so would you say it’s smarter to just default? the whole loan amount is 107,000 with interest, obviously still recurring

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Odd_Investigator_736@reddit

Well, put it like this... there's a saying to never solve a temporary problem with a permanent solution. There's no going back from defaulting. I would say maybe (and this is a big maybe), it's not unwise to default if you're in a situation where you can't afford to pay them anything anymore (exhausted deferment, forbearance, and the lowest they will allow you to pay to be current isn't even feasible anymore), and you're in a cycle where it's more likely you will die before seeing this get paid off (in other words, your debt is a permanent problem that can only be solved with a permanent solution). Just know that defaulting them is like going through a lengthy, and likely ugly, divorce process with them. Just don't put all your eggs in the basket of possibly slipping through the cracks of not being sued. I really don't think that's what happens with the majority of defaulters.

I have told my kids never to borrow private student loans and never to cosign for anyone.

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Shiznit711@reddit

I just stopped paying for 6 months & they finally budged, got it down to $475 with 4% fixed interest

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EqualExtreme7876@reddit (OP)

but at that point they already reported you to the credit bureau’s right?

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