My husband co-signed on our daughter’s private student loans. (We didn’t know they would be considered “private”…at the time). To the tune of $26,000.
She is a single Mom with 3 teenagers and hasn’t been able to make payments ever. We paid on this loan for several years (didn’t realize it was “only interest”)…However, we need the original papers, and that’s probably impossible as our daughter does not have them.
It started out at Sallie Mae and is now owned by Navient. We tried to work something out to lower payments. (They want $264.00 a month, and we can’t afford it.) I’m 64 and my husband’s going to retire in a few years and we have very very little savings.
We filed bankruptcy back in 2009, and the loan people would not dismiss it…(because it was private or the law at that time?) So here we are retirement age and stuck with (for us) a pretty huge sum loan. We called Navient and tried to get them to extend the loan payment term from 9 years to 20 or 25 so we could lower the payments to $80 or so, but I believe the interest rate is probably about 9% (pretty high).
Well it’s already messing with our credit scores…They sent a letter saying the loan was going to default and to call…We don’t think our daughter is going to do anything about this loan…
Given the above information….threatening default…what will happen? Can Navient debit our income in any way? If not, we don’t want to be sued…We want to call them again and see if they’ll extend the loan length if they won’t what can we do? Thanks so much in advance…We are so stressed about this (and my husband’s bearing the brunt of it…and has blood pressure issues…) Thanks again, Steve (wish we had documents to attach)…
Well the situation is what it is. It sounds as if your daughter can’t afford to make the payments and you guys are not in a position to either. So you are either going to have to accept whatever solution Navient is willing to offer or you are going to have to alter the situation in some way.
When people are unable to pay, that alteration generally takes the form of defaulting and looking for alternative solutions. You should read this article that talks about the options.
The reality is if you can’t afford to make the payment Navient is demanding or offering, it will negatively impact your credit. Right now that’s the least of your issues. And if you default on the loan, not only will your balance go up significantly but you can always be sued and then they could try to collect through a garnishment or a lien. Of course it depends on what state you live in so consulting with a lawyer who is licensed in your state is always a good thing to do.
Now all of that being said, if you are prepared to take a riskier approach to dealing with your Navient private student loans, they have been known to settle the debt for less than owed. See This is How You Can Settle Your Navient Student Loan to learn more.