My father co-signed for private student loan. How do I pay this?

Hello my name is Brittany and I have a private loan from my old school that amounts to 22,152.62. I’m currently in school at the moment my father co-signed on the loan. I kept putting the loan off until I recieved a call from them stating that I needed to pay something or negotiate something or my father assets will be taken away.

Pretty much there going to sue me.So I’m scared because I dont have the money right now. He said the only way he could process my forbearance letter is if I pay 348.00, which right now I dont have.This is the statement:

Original loan amount:19,951.00 Interest Rate:4.2500000% Days In Billing Period:31
Current Principal:$16,776.00 Interest Rate Paid YTD:$0.00 Past due amount:$518.18
Previous Balance:$22,064.00 Interest Accrued:$78.55 Current Balance:$179.50
Current Balance:$22,152.61 Fees due:$10.16 Total Amount Due:$697.68

I told him I would pay the 348.00 by Saturday, February 10th he said is the last day. But I dont want them to take my parents money or home. But I dont even know if Im going to have that kind of money by then.So what should I do?

Brittany

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  • Michaela

    So in essence you have kept the loan in forebearance/deferrment as long as the lender can allow and it must go back into repayment in order to become eligible to apply for another forebearance.  If making a payment of $348 puts the loan back into repayment and you can then apply for forebearance, that would be better than allowing the loan to default and trigger all of the penalties (big money) and collection recourse that would ensue.

    My recommendation is that you go to your parents to see if they can help you make the $348 payment.  By co-signing on the loan, your father guarenteed he would make the payments regardless if you are able.  It would be best if you gave him the opportunity to save his own credit by avoiding legal activity and asset seizure.  If the loan defaults, they won’t bother with you because you have no resources.  They will go straight for your father.  It would be best if he heard from you that action must be taken in a way that allows him to take the action in time. It may be uncomfortable but it’s better than waiting for his angry call once the constable serves him with papers placing a lien on his home or bank or brokerage account or paycheck.

    • http://GetOutOfDebt.org Steve Rhode

      Michaela,

      I just wanted to say how nice it is to see you here and helping in the comments.

      Thank you for helping.

      Steve

      P.S. Your advice is what I would have said.

  • http://www.consumerrecoverynetwork.com/ Michael

    Hi Brittany,

    There are little to no advantageous strategies for private student loans. If you have already been through any deferment and forbearance options allowed, committing to an agreeable payment plan and sticking to it until you can earn and pay more would remove the risk to your parents. This may even mean lightening your class load to allow the additional time for part time work.

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