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Student Loan Wage Garnishment

Ray Said:

How exactly does Sallie Mae student loan wage garnishment work?

We Answered:

SMiD:

The amount of your income that is subject to administrative garnishment is 15% of your "disposable earnings". By definition, "disposable earnings" is all of your income that is left after federal, state and local taxes, social security, and unemployment has been removed from your paycheck.

No matter how many student loans you default on, your maximum exposure for wage garnishment is 15%. If it makes you feel any better, federal law allows garnishment of up to 50% of disposable earnings for child support obligations.

Do yourself a favor - negotiate with your lender to reach a mutually agreed-upon repayment plan. The amount that your lender will demand will be less than the amount subjected to the garnishment. I can absolutely guarantee you that your life will be miserable while under a garnishment order - that's exactly why the threat of a garnishment is so effective.

Do yourself another favor. Don't underestimate the negative consequence of student loan default on your credit history. By reaching a repayment agreement, you can rehabilitate your loans, and get the black marks removed (permanently) from your credit report. Pay involuntarily, by administrative garnishment, and you will have a near impossible time qualifying for a home mortgage, a car loan, or new credit cards for many years to come. Your existing credit card companies can use the default as an excuse to jack your current rates up to the maximum amount allowed by law, some landlords will not rent to you, and some employers will not hire you.

If I can give you ONE piece of advice - don't take default and especially garnishment lightly - or just lie down and let it happen, because it seems like the 'easiest' thing to do. You can't fight the debt, but you CAN take voluntary action to get the debt settled in a much more cooperative fashion.

Good luck. (you need it)

Lewis Said:

How to stop student loan wage garnishment?

We Answered:

Call your student loan lender and ask them to stop. Read the paperwork that came with your student loans. There are clauses in there that say when you don't legally have to pay. You can actually go 10 years without making a student loan payment without it going on your credit as long as you keep your student loan lender apprised of your income situation. If you make a nice income they are going to keep taking the money though. But if you are in or close to the low income range they will stop for a while.

Jenny Said:

In texas how do you stop student loan wage garnishment?

We Answered:

Contact the lender and get current and/or a payment agreement and keep it.

Only way out..

Danielle Said:

TEXAS student loan wage garnishment HELP?

We Answered:

The US Department of Education Debt Collections Services will not garnish wages if you are making the minimum payment. So, if you call them yourself and tell them that you are currently employed and would like to set up a payment plan, then continue on in making the agreed upon minimum payment, wage garnishments will not happen. That only happens when people are not paying the loan payment on their own.

So, if you'd rather they not garnish your wages, be sure to keep in contact with them, set up a payment plan, and start paying it back. Once they receive a minimum of 6 consecutive and voluntary monthly payments, your loan will be eligible for consolidation. This means that the defaulted loan will be repaid with a new loan, thus retiring the defaulted debt. It will still remain on your credit report for years to come, but clearing the default will definitely help. Keep in mind that the 6 payments required for consolidation must be VOLUNTARY so wage garnishements do not count toward this. Prevent wage garnishments by setting up a payment plan and faithfully making your payments.

You have created this mess and getting out of it can be fairly easy. Just 6 months of sacrifice in making your payments, then once you consolidate you will be eligible to request a deferment or forbearance again (deferments or forbearances are NOT an option on defaulted loan debt).

Minnie Said:

How to stop student loan wage garnishments if you agreed to make default payments?

We Answered:

Well it seems to me if you set up the auto-draft to your bank account willingly you should be able to stop it at will as well. Call your bank and tell them you want to stop sending that company money. Or allow them to take it out of your account, however it was set up.
Good luck!

Alice Said:

Can anyone help me find a way out of student loan wage garnishment? Rehab programs or something? Please help!?

We Answered:

Unfortunately, once the garnishment starts you are out of options. The only way to stop the garnishment then is to pay off the loan. If it's a federal loan, you can try to "rehabilitate" the loan, which involves you making 6 reasonable, willing, and on-time payments (while still being garnished) and then you can ask for the old defaulted loan to be paid off and a new loan will be issued that is not in default and they wont garnish you wages after that (unless it goes into default again).
Here is more about it:
http://www.ed.gov/offices/OSFAP/DCS/inde…

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