Anyone here live in a state that doesn’t allow wage garnishment?
Posted by brokeboii94@reddit | studentloandefaulters | View on Reddit | 16 comments
Hope this post gets approved. I have about $180,000 in Sallie Mae loans. The original amount was much less than that but they have been growing due to high interest rates. Sallie Mae gave me 6 months forbearance but they made it clear I can’t get more forbearance after that and I plan to default in June. I live paycheck to paycheck on a fixed income and I am considering a few options the first being leaving the country which is easier said than done the second being filing for bankruptcy and fighting like hell to get a discharge and the third is moving to state like Pennsylvania Texas or North Carolina which don’t allow private lenders like Sallie Mae to garnish wages if they sue and I don’t have any major assets. Does anyone here live in one of those states? I’m curious to know if they would still try in those states.
rutherfraud1876@reddit
Ahhhhh, that might help explain the discharge I got in the mail a few months ago.
Pittsburgh is a beautiful city
morbie5@reddit
Even if you ran out the SOL that doesn't mean you got a discharge. If you are lucky enough to run out the SOL clock you still owe the debt, they just don't have a way to collect on it using the legal system
ConsoleModded@reddit
Then do you really owe it? At that point it’s an imaginary number
morbie5@reddit
Yes. If you fill out a job application and they ask 'do you have any past due debts?' you would be lying if you answered 'no'.
Can they figure out if you are lying? idk, maybe if they look in a database like lexisnexis (if it is even in there)
Other than things like that it won't matter much tho
ConsoleModded@reddit
What's the story behind the discharge? Who did you have your loans with and how long did they wait until discharging them?
rutherfraud1876@reddit
Don't remember
Killadelphian@reddit
They can’t garnish wages but they can still garnish bank account, no? Like PA?
ConsoleModded@reddit
Pretty sure even then they can't garnish a bank account if it's shared under marriage.
brokeboii94@reddit (OP)
Yeah with wages they’re guaranteed to collect but they aren’t guaranteed anything if they freeze a bank account
morbie5@reddit
I'm not a lawyer but my understanding is that they may be able to still garnish if you moved from out of state. You better consult a lawyer in one of those states.
Do you have a cosigner on these loans? What is your income?
brokeboii94@reddit (OP)
No I don’t my income is 52000 before taxes
morbie5@reddit
And if you don't mind sharing: how were you able to borrow so much without a cosigner?
morbie5@reddit
You could just default in the state that you do live in and try to negotiate a settlement. Even if you got sued and had your wages garnished that would probably be cheaper than your monthly payment on this massive balence
-C3rimsoN-@reddit
I live in Pennsylvania. Similar situation where I had $99,000 in private loans from Sallie Mae. Strategically defaulted in 2018 with no assets. Sallie Mae never even bothered with suing for it. It was sold to a collections agency about 6 months or so into the default. They called a lot, sent a few letters, but never took me to court. You're right that Pennsylvania is one of the few states that doesn't permit wage garnishment on consumer debt with private student loans being considered consumer debt. Also, our statute of limitations on consumer debt is 4 years. I'm well past that now and the collections have all but ceased. I do still get a phone call or text like every 8 months or so, but I just ignore it because there is nothing they can actually do at this stage.
The only issue I think you could run into is where the loans originated from. The statute of limitations may apply for where you took out the loan not where you are currently living. Also, not sure if the same would apply wage garnishment. Like the loans might fall under the policies of where it originated. This might be more of a question for a lawyer specializing in student loans/debt.
brokeboii94@reddit (OP)
Maybe not because the courts where I live wouldn’t have any jurisdiction if I moved
-C3rimsoN-@reddit
Yeah, that's really the only issue I could potentially see. You may want to speak with a lawyer on that aspect. Also, I'm pretty sure if your plan is to overstay the statute of limitations, it's dependent on the state where the loan originated from. So hopefully, it's a state with either 4 years or less and not one of those states where it's like 10+ years. Only reason I'm aware of this is because I had gone to school in Massachusetts, but my legal residence was PA (what can I say, I was a really stupid teenager lol). Massachusetts SOL is 6 years, but since I wasn't a legal resident, my loans fell under PA's 4 year limit.