Wednesday, March 14, 2007

The Story continues...

Originally posted 03/12/2007:

I'm 33 years old, and three years ago, I decided I'd try to get re-trained for another job market, as mine was slowly going into the toilet.

I went to Western Culinary Institute and got accepted to get trained as a culinary chef. My initial loans from Sallie Mae were for $22,000 on a signature loan, and $4,000 for the federal aid loan. I was never told that there was a difference, that they couldn't be consolidated together, and that things were just beginning to get worse. In addition, there was no disclosure about how much the interest would be, either.

I graduated from WCI in November of 2005. I had been working part-time in a call center, and when I went to look for a job as a cook, found that I couldn't find anything that was more than $8 per hour - well below what I had been making before, and certainly not high enough to pay off my student loans. I'd been told by the recruiter that I would be able to find plenty of well-paying jobs in the area, but when it came time, there weren't any to be found that were more than fifty cents higher than minimum wage. In my exit interview, the loan officer at the school told me my payments would be $450/month. I laughed at her - I couldn't believe they'd be that high.

I decided to go full-time in the call center where I was, and attempt to put aside monies so that in 6 months, I could start paying them at least something. The pay was decent, and I thought I could do something with the money I made there. Six months later, I got my first bill and found out that the loan officer was wrong - it wasn't $450/month. Nope - it was $553/month! In addition, for each month I didn't pay, the percentage rate on my loan was going to be at 18.9% - but if I DID pay, the interest would only be 14%! This didn't include my federal loan, which was $165/month.

I couldn't pay $553/month - I couldn't even pay the $165/month for just the federal loan. I asked for a deferral so that I could have some time to figure it all out, and started searching on the internet for anything that I could find regarding my situation. I couldn't find anything other than the Federal Ombudsman's Page - which dealt strictly with federal loans - the government would not help me if it was a private loan, and Sallie Mae was free to charge whatever they wanted for the payments as it was ungoverned.

I did consolidate the federal loan and brought it down to $60/month. I had thought that, since they were under the same account numbers (absolutely NO difference whatsoever), the federal AND the private loan had been consolidated - I'd done everything on the internet. I know that I put the private loan into my request when I set everything up. They refused to consolidate the private loan, and stated I'd never asked - even though I know that I had. They then informed me that federal loans and private loans can't be consolidated at all - that they must remain separate - when I asked them why they had them under the same account number if they "had" to remain separate, they told me that they had a way of making sure that it was separate in the computer system.

After my first deferrment, I was called upwards of 8 times per day, was called a deadbeat and a liar, and told that I needed to pay "or else". I requested that they stop calling and hounding me, that it was illegal to do so. Sallie Mae's reps told me that they could do whatever they wanted, that they weren't bound by ANY federal law, and they could call as many times as they wanted.

I got another deferral and tried again to see if there was anything I could do to help myself - I attempted to move and consolidate my loan through other agencies, but was denied repeatedly. The reasons were that either I didn't make enough money to pay back the loan at their preferred rate, or that Sallie Mae wasn't releasing the information to them in a timely enough manner. After that, I sunk into a depression that I have yet to beat.

Sallie Mae took my money a day early when I set up a post-dated deferrment payment of $50 for their "processing" fee. I told them it was illegal and had cost me NSF fees at the bank - they told me they could take the money whenever they wanted, and that the date I'd given was a "suggestion", not something they had to follow.

I was told that I should "expect" such poor treatment from them, since I hadn't made even one payment, and since I was unresponsive to their calls. That I deserved it. That I was a horrible person.

When they called again on March 9th, I finally spoke with one person who worked with me a little. She was very nice and helped set up what they called a "forebearance partial payment" of $175/month for 5 months. The catch? Well, each payment would have a $10 processing fee added to it, and I'd have to pay $50 for the initial fee, AND I'd have to pay February and March together at the same time so that I'd get "caught up". Oh, and I'd continue to get late fees attached to those monthly payments since the remaining portion wasn't being paid, AND interest would continue to accrue at 18.9%.

I was terrified to do anything except say yes. I didn't want my loan to go into default, and felt that I had nowhere else to go. I couldn't seem to get out from under them at all, and couldn't see a way out of the mess that I'd inadvertantly created - all because I'd wanted to go a different direction at one point in my life.

Even after I said yes, faxed paperwork back and forth to agree with the partial payment, and had everything (I thought) agreed upon, I was STILL called two more times that day, and again two more times two days later!! I was again told that I should expect such treatment because I was "bad" and hadn't made payments to them, so I deserved it. The first person told me that the calls would stop after the initial $50 fee was taken. The NEXT person, who called two days later, said that no, they would only stop once the faxed paperwork was actually processed, which would take upwards of 72 hours.

I've called the Wm D. Ford loan company, and was told there was nothing they could do about the principle amount of the loan, since it was a private signature loan. I was given the phone number for the Federal Ombudsman, and was told there was nothing THEY could do either, since they only dealt with the federal portion of the loan - that Sallie Mae was indeed correct about stating they could charge whatever they wanted, at whatever interest rate they chose to.

I *WAS* told by the Federal Ombudsman that Sallie Mae HAS to follow the Fair Debt Collection Practices Act, regardless of whether they are a private corporation or not, and to start making a paper trail regarding everything they've sent me and everything they're doing to me. However, I cannot have the loan dismissed simply because of hardship - while the government looks on the loan as the same thing as a credit card, the LAW says that it's a student loan - and therefore I cannot file bankruptsy on it, either.

At this point, I'm fairly near hysterical because I don't know what else to do. I don't make enough money to pay the full amount, and with the percentage rate, the late fees and the processing fees, I'm looking at upwards of $90,000 before I see the final chapter of this - if I ever DO see the end of it. The stress is ruining my health, it's putting a strain on my relationship, and it's causing me to seriously think of suicide at times because I feel as though I have no other recourse. I'm crying as I type this because the situation seems to me, at this point, to be completely hopeless. I don't know what to do right now, and I'm feeling more and more like a failure because I PUT MYSELF IN THIS POSITION AND CANNOT SEEM TO FIND A WAY OUT OF IT.

~M

11 comments:

Anonymous said...

Good Morning,

Wow, theres someone else out there who feels like I do. I have almost the exact same problem, only mine is about 6k less then yours.

About two weeks before Christmas last year I was called by SM, saying that I would have to start paying since I was no longer in school. I had not gotten a job in my field, as it was being flooded, so I was working at a small factory for $9. I told them on the phone that I would pay $500 in two weeks (two days before Christmas), on the internet through my check card. He said okay and I thought I was fine. But one day after I payed the $500 they took out another $500. When I called to ask what the F they were doing they said that I told them they could take it...I had no money for Christmas, or gas to go visit either my or my BFs parents. Let alone enough to pay the next months bills.

I have payed for almost a year striaight, on time, every time, and now I'm in a bit of a situation. I lost my other job (which I had gotten over $10 for) and now am down to $7. I couldnt make last months payment so I called. They said that I would have to, that I had no choice, and I said I had no money. Then they FINALLY said that I could defer it. So I said I'd do that, for $50 of course. Well, my check card isnt working so I said that I'd need to send the money in. They said okay. Then a week later my check was smaller then I thought it would be so I called again and they said that it was unacceptable. I'm sorry, but I had to pay rent, and eat.

So now I am hoping I can do something, scrape some money from somewhere so that my credit report doesnt go in the crapper. Worrying about this makes me depressed. And the CONSTANT calls (upwards of 7 a day) really dont help.

There are a lot of us out there, and somehow we can find some menial comfort in eachother. Heh.

Josh H. said...

Sallie Mae is a sink hole, both monetary and psychological, for anyone who wants to further their education. I've been able to keep up with my payments of apprx. $600/month ONLY because I moved back in with my parents after graduating with an 18mo. degree.

I never found a job in my field, as the school I had gone to over-exaggerated on the availability of jobs in legal administration. I work one full-time and one part-time job, and the full-time paycheck is sucked up by SM every month. There is no way in hell i'd be able to pay for my own room and board without finding a LAA job, and even then money would be tight.

So, I joined the Navy, scored well on my asvab, and was given the option of having the federal portion of my loan paid off by them in exchange for a 6 year service agreement. Since the federal bit is the largest part ($19k out of $27k), I agreed and started filing my LRP forms.

SM, my lender, is under obligation to release my loan information on my request, especially under these circumstances. You'd think they would be more compliant since they are getting a nice chunk of change handed to them at once, but they keep sending my LRP forms back saying they cannot release my loan information to me or anybody else if they didn't want to. I guess they really don't want to lose out on the interest.

I've got about two weeks to file these papers, or I lose my LRP bonus. My next step will be talking to JAG about getting a warrant or subpoena or SOMETHING to get them to release my info.

Its probably not something you'd consider after reading your SM blog, but I think they'll be able to help me. I'll comment again later to let you know if they end up complying or if I end up losing my bonus.

windhowl said...

I have only one advise for anyone: DO NOT consolidate with Sallie Mae; stay far far away. Schools will push them but there is William D. Ford.

jewels said...

I should have asked the Mafia to go to school instead of Sallie Mae. Sallie Mae's plan is to torture me slowly for the rest of my life when I a miss a payment. The mafia would break all my limbs and stab me, however I would heal much faster than with what Sallie Mae is doing to me.
After extensive research over the past five years I have found out there is no way to make this debt more manageable unless they pass new laws that work in our favor(will never happen).I actually moved to another country to escape Sallie Mae. I guess we'll see if they come looking for there $90,000.

jewels said...

I should have gone to the Mafia for a loan. For missing a payment they would have broke my limbs and stabbed me but I would heal faster than the lifetime of torture Sallie Mae is plans to put me through. After 5 years of extensive research I've have come to find out that there is no way out and no way of making the debt more manageable.
I have actually moved to another country to escape Salli Mae's slavery. Well see if they come looking for their $90,000.

Pat said...

I'm having the same issues as you guys. I never would have gone back to school if I would have known it would have been this much of a headache in the end.

Sallie Mae's customer service is the worst! I wish some changes would come about that would stop these people from ripping people off.

cellotlhicks said...

Wow. I think about moving to another country as well. I have thought about just jumping off a bridge. Sallie Mae's $180,000 would go in the water with me :-D
I wish Id never gone to school some days. I am unemployed, on food stamps and unemployment, (with a Masters!) and the Bitch still calls and emails me.

Save Our Students said...

We has started an online petition for private student loans, we need as many signatures as possible.

http://www.saverstudents.com

Thanks for the support!

donald said...

There are a lot of us out there that sallie mae have screwed. The thing is they are untouchable you can not file bankruptcy thanks to George W Bush. Now they are trying to call in the entire loan. I say good luck to all of us, we will need it

tfair85 said...

@donald.

First, filing for bankruptcy would have never done anything because you still have to pay on Student Loans. That was in place before George W Bush. Second, his bankruptcy rules only apply to business, not to individuals. Do some research for once. Third, Obama had been in office for over a year when you wrote that, so why didn't you ask him why he didn't change the new rules?

fs said...

I’ve begun leaving my sentiments- Sallie mae is evil- on their Facebook wall, for all the public to read. I’d like to ask everyone to join me. A FB wall full of posts about how SM is ruining our lives might send a message.