I Want the Department of Education to Get Their Sh*t Together


Dear Steve,

I am not sure exactly who to direct this issue to, therefore, if you are not the correct person/dept, please advise.

Well Over 20 years ago I took a student loan through the Department of Education to attend college. If I recall I made payments for some time after graduation in 1988. When I began teaching in a low income area the loan was credited monies toward repayment. I do not remember how much or for how long. Many years after that, I was diagnosed bi-polar and went to court for disability benefits. When the judge granted this, my student loan was cleared. This is approximately 5 years ago.

I have gotten many credit reports where there is never a mention of an outstanding loan, and for some time my score was excellent.

Yet, today when I called my bank there had been over 200 garnished from my check by the Bd of Ed. I called and was told that I had an outstanding bill for 20,000!

I have no idea who or what computer screwed up and created such a massive error? The address they had on record was at least 15 or more residences ago and around 1990!! I have never heard from anyone about this issue in decades.

I contacted a family member who is a lawyer. If this massive mistake is not resolved immediately and the monies not returned to me you can expect a law suit. I am now without 228 dollars in my monthly income, and this jeopardizes my rent/utility.

I expect to hear from someone by week’s end and that the money mistakenly taken out of my check be promptly returned. Or else I WILL begin legal proceedings. I will not sit on the phone on hold for an hour to speak with someone. So therefore do not reply offering me some 1-800 tele.

All future communication will be written as to be documented. This letter will be notarized and copies given to any involving agencies/my lawyer.

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Coming after someone’s paycheck without having any contact with them for twenty years is insane and needless to say professionally negligent. I have never gotten any bills, letters, or warnings regarding the potential for garnishing my SS.

It is a law that I must be notified 30 days prior to any garnishing of wages, which was not done!!

Furthermore, this debt was pardoned upon the diagnosis of being bi-polar and the judge granting me SS for the remainder of my illness. In a less professional comment, get your shit together or I will take appropriate measures.



Dear Betina,

I’m assuming you did not mean to target me in your correspondence. Obviously I have no role to play in your situation.

But there are a couple of issues that stood out as I read it.

You mentioned that your loans were forgiven by a judge. But the Total and Permanent Disability Discharge (TPD) is an administrative process. You would not have gone before a judge for the Department of Education forgiveness. You can learn more about that program, here.

And while I can understand the issue that you don’t want to invest time in fixing the problem, someone is going to have to get to the bottom of this.

It’s quite possible that your loans were not discharged and sat lost on a shelf. You may have been attempted to be contacted at your last know address on file.

To discover the status of your federal student loans you should logon to the National Student Loan Database. This will give you information if the loans were actually discharged or not.

If your lawyer family member will help you deal with this situation, it might get resolved in a month or so. However, it is also likely more garnishments will occur from your next check.

It sounds to me as if your income/benefits are government related and/or Social Security related and your garnishment is coming through an administrative offset. It is actually easy to stop such a garnishment. Read this article.

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But I can’t stress enough, no matter how outraged you may feel over this situation, you MUST actively participate in resolving the situation.

And finally, it’s important to understand that a credit report is not a comprehensive listing of past and current financial obligations or liabilities. It only includes what some entity choses to share and provide with the bureaus. It is entirely possible the loans simply were not reported to the commercial credit reporting agencies.


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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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1 thought on “I Want the Department of Education to Get Their Sh*t Together”

  1. I agree with Steve, it is very possible your loan balance remained in limbo. In my situation, I was awarded SSDI in 2003 and my student loan debt at that time was about $48 or $50K. Being on SSDI, my loans were deferred and I since I was unable to work, no payments were required and none made. When I reached full retirement age, the Social Security Administration, switched me off of SSDI and put me on straight Social Security Retirement! When that happened all of a sudden the Department of Education came after me with a vengeance! They claimed I owed nearly $98,000.00 in student loans, and for the next 6-7 years my Social Security (and a small Federal pension) was garnished each and every month to the tune of nearly $300.00. When I began to see that the amount being garnished was not even covering the monthly interest on the debt, I decided to file an Adversary Proceeding! I filed a chapter 7 bankruptcy followed immediately by an Adversary Proceeding under the “Undue Hardship Clause” to seek a full discharge of $130,000.00 of consolidated and defaulted student loans. The Department of Education filed a Motion to Strike my 56 page complaint, I followed up with a Motion to Oppose and on Tuesday, February 2nd, 2016 at the motion hearing, the bankruptcy Judge told the lawyer for the DOE my complaint was not too long – just comprehensive, and it was justified. The Judge upheld my Motion to Oppose and ordered the DOE to answer the complaint by the end of the week! On Friday February 5th DOE Lawyer (the US Attorney) called me at 4 pm and said “Mr Precht, congratulations, the Dept. of Education has decided to discharge all of your student loans” I NEVER went to trial because I proved my case of undue hardship per USC 11§523(a)(8), and I used the July 7th, 2015 US Department of Education’s Policy Directive as my defense! Read about my victory here on Steve’s blog: https://getoutofdebt.org//98507/using-information-man-discharges-130k-federal-student-loans-bankruptcy


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