My wife has a reasonably large private student loan. I have recently come into money and would like to settle this loan with Navient for a lesser sum than what is owed on the loan. What is the best way to go about this and what questions should I ask in order to get a settlement?
While Navient may say they don’t settle private student loans they hold, they actually do. Settlement offers I’ve seen have been in the 45%-50% range with up to two years to pay.
But, and this is a big but, they only seem to do this for people who are significantly past due on the loan. I’m not encouraging you to go past due, just telling you what reality is. This is more of a general creditor process failure than anything else. Creditors do not exercise logic when it comes to collecting. Instead, an understandably so, they use what they feel works best for them. This might be continuing to pressure people rather than let on they do settle.
If you call Navient and say you’d like to settle, don’t be surprised if they tell you they never settle. This is because the general collections and the initial delinquent collections departments just don’t have the authority to enter into such agreements.
The settlement offers seems to come from the pre-charge-off department when loans are more than 120 days past due.
So herein lies the problem. You will have to risk going significantly past due and hope they continue to offer the settlements. It will negatively impact your credit and you could get sued over the delinquent debt. Let’s not forget, if you are solvent, the forgiven debt will be taxable and you will probably get a 1099.
Feel free to take a swipe at settling the debt or contact my friend, and get some professional help with this.
Please post your responses and follow-up messages to me on this in the comments section below.Big Hug!