Thinking about defaulting on Firstmark private loan

Posted by frodo_archeron@reddit | studentloandefaulters | View on Reddit | 11 comments

I took it out as a private loan for 22k, have paid 40k+, still owe 27k, ~13% interest. My dad's a cosigner. I live abroad, no assets in the US. My dad's a renter, no big assets. We're considering default since this loan will simply never be repaid in full in my dad's lifetime, and possibly not my own. He's self employed, so no fear of garnished wages.

I have seen on here that people have been able to default and then negotiate to a smaller lump sum with Firsrmark's collection department, since they likely bought the loan for pennies on the dollar.

I mentioned this to one customer rep on my (nightly) call, and he hinted that this is indeed a possibility.

The only negative we can see is the hit to my dad's credit score. After long discussions, we consider this an ethically comfortable choice, given the way the loan was structured, the amount we've paid, and how it has been sold.

Would love input from anyone else who's done this with Firsrmark.

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OldmanJeeeennnnkins@reddit

Your dad being self employed doesn’t protect him from a lawsuit. They can legally freeze his business account (bank account levy). A lien can be placed on his assets. They can just straight up seize his assets. I’m sorry to break the news to you, but a dinged credit card won’t be the end of it. Once you default, the collectors will follow you and your dad to the ends of the earth to get that payment.

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frodo_archeron@reddit (OP)

So, the reason I'm asking is because there are a few other threads on here specifically about Firstmark in which they mention that they will negotiate with their in- house collection agency to settle at a % of the debt. Firstmark bought this loan from Discover for pennies on the dollar. They're happy to get anything because they know it's bad debt. The last time I spoke to one of their customer service reps, he confirmed as much.

Hence my asking about Firstmark experiences, not experiences with private loans in general.

Also, they can't follow "to the ends of the earth" because there is a statute of limitations.

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Aggravating_Storm493@reddit

I’m dealing with Firstmark right now as well. What have you decided to do?

My situation is a little different in that I filed for bankruptcy and then an adversarial procedure which got my private student loans discharged mid last year. The loans were removed from my dad’s credit report too which was interesting. But this was when they were still Discover. My dad hadn’t heard a peep from Discover or Firstmark since last Fall.

Suddenly in August, I received a letter from Firstmark saying that I had a balance (because obviously they bought the damn Discover debt) and now my lawyer is dealing with it. She told me not to worry.

However, just today my dad, my dad got a kind of sketchy email from a real human at Firstmark, saying the account was severely delinquent and at risk of defaulting by the end of the month. But the loan still isn’t on any of his credit reports. And the email claimed they’ve tried to contact my dad several times now when in fact this is the first communication in almost a year.

All of this is to say - the debt settlement attorney we spoke with out of panic today said there’s nothing to be done unless the loan goes into default. And as of right now, we don’t even know the state of the loan. Like, wouldn’t the loan have come back on his credit report by now? It’s been delinquent for FAR longer than the usual time they take to default it (over 270 days, seems like everyone else got told they were defaulted at 90 days)

TLDR - Firstmark sucks. Let me know what your situation with them has been since your first posted this! I would be so appreciative of any information you might have and also very happy to share anything else I might know

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frodo_archeron@reddit (OP)

If I were you, I'd avoid responding to any communication. It resets the statute of limitations. We're working with a lawyer and decided to default. We don't respond to anything.

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Aggravating_Storm493@reddit

Ahh ok. That makes total sense, I didn’t realize that but that makes sense.

When did you start working with the lawyer, before or after default? The lawyer we spoke with said he doesn’t have anything he can do for us until the loan defaults and said he doesn’t want to waste our money like that until the default point comes.

And did your lawyer say anything about how it is dealing with Firstmark? It’s been hard trying to find other Firstmark defaulter stories on here, this loan of mine was transferred (sold?) to Firstmark from Discover.

Anyway, sending you the fight and all the good things that you and your dad get through this with a great deal. If you are able to update on your case on this sub, I would be so appreciative since your case / dad’s case sounds remarkably close to mine in many ways.

Thank you so much regardless, I really appreciate the comment to me and will stop communicating with them.

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frodo_archeron@reddit (OP)

Can't - both our credit scores are already ~500 so there's no way they'll remove him.

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Fluid_Plantain_Tour@reddit

I think credit scores can't even go lower than that. Consider getting him a secured credit card so he can build credit up .

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OldmanJeeeennnnkins@reddit

A score can go to 300 at the lowest but that’s usually only when, well, you default on things.