Your Questions About How To Get A School Loan Forgiven
Jenny asks…
How can I keep them from taking my Social Security for school loans?
I am 61 1/2. For health reasons, I was planning on retiring at age 62. However, I just received a letter from a debt collection agency telling me they will take ALL my Social Security monthly payment to pay this debt. I need every penny of that money.
I graduated at age 42 in December 1992 from ASU with a Bachelors of Science in Business Management, which has been a totally useless as far as getting paid better or finding better job placement. However, I greatly appreciate my education and I really enjoyed the time I spent at Phoenix College and ASU, but times have been difficult and it doesn’t look like they’re going to get better anytime soon. I would happily repay the money if I could.
I was fully disabled for two and 1/2 years in 95-96. I went back to work, but lost my job in the last economic downturn (approx 2003). It took me another four years of working low paying jobs through various temporary placement services to secure another full time position with the State of Oregon. I am also severely hearing impaired, which further limits my ability to get a job.
I have been partially disabled from a fall in March and I have had three operations on my back in the last three months. I will be able to return to work in November part time and my doctor doesn’t think I’ll be able to work full time until January 2009. My 62nd birthday is on March 31, 2009 and these health difficulties are the reason I really need to retire then if I possibly can.
I there some way I can claim disability as a reason to have the loans forgiven?
Also, I have enough medical debt to claim a Chapter 7, I think. Last I heard, these loans could not be put in either Chapter 7 or 13. Is that still true?
Joe answers:
Tell them to go ahead and try. Social Security is not garnishable except for back taxes. In addition, the maximum amount anyone can garnish of wages is 25%.
Next time they call, ask for their company name and address – they have to give it to you. When you get the name and address of the company, write a letter, return receipt requested, to them that formally requests that they stop calling. Under the Fair Debt Collection Act, if you request that they no longer call, they can’t call. This should be done in writing so you have a record.
Betty asks…
If someone had a student loan and they have been declared disabled, is the loan forgiven?
I got a student loan in the late 1990′s to attend nursing school. I was later injured so badly at a major hospital that I was declared by the federal government to be disabled. I am now on SSI, full disability. Is my student loan forgiven? If so, how do I go about that?
Joe answers:
Contact your lender and tell them you are disabled. You will have to submit paperwork and sign releases and have your doctor sign off on it. They will do their own investigation and let you know their decision. For my hubby, his loan was “conditionally” discharged for a few years first. Then his situation was re-assessed before it was completely discharged.
Also, if you have let your loan go into default, that will still be on your credit report. Even if you get it discharged, it will still be on your credit report, because you were still delinquent in the payments of it and let it get into default.
Maria asks…
first mortgage/credit question?
My fiance and I are looking to move into our first place next year. we have combined 20k in school loans. I have a 710 fico and she has a 695. we have 10k saved for a downpayment and plan on doubling it in the next year. we were curious how our school loans will affect our debt/income ratio. there are people who get mortgages with hundreds of thousands in school loans. are there special loans that forgive/ignore school loans? also, any suggestions to improve fico in the next year?
Joe answers:
School loans – installment loans – not bad for credit.
Home loans – mortgages – also not bad for credit.
Credit cards – revovling credit –
Do not ever open any new insalment loans 18 months before making your home purchase. New credit.
Do not open any credit cards 6 months before your purchase.
New credit reduces scores.
If you get a credit card.
Use it for something you need like food or gas and pay in full each month.
The card company reports to the bureaus on the closing date and it will show usage.
And it makes the card company happy since they charge the merchant 3% of every purchase.
You need to show usage on the card.
Do not carry balances on credit cards.
This can easily destroy credit and devastate your goals.
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