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Posted in Student Loans
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Question By
rowe07

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What if my student loans are now threw a collection agency?
I read if a your debts are sold to a collection agency you can dispute it and state the contract was cancelled. Does this always work if student loans go to a collection agency and if so what do I do about not having to pay?

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You will have to Pay!

First, you will have to repay your student loans. No way around it unless they are forgiven (teacher in high risk area, certain other professions).  If you signed promissory notes, you owe the debt.  Second, you are probably in default which is a derogatory mark on your credit. If you are looking to get on the right track, contact the collection agency.  Ask what you can do to start repayment and get out of default.

Whatever you do, do not ignore them.  If these loans were backed by the federal government (Stafford, Perkins), know that your wages and tax refunds can be garnished legally.

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That idea is B.S. May work in extremely rare cases of a lack of paperwork, but the majority of financial institutions are not stupid and you sign agreements when you get credit. If these student loans were Federal loans, you need to figure out a way to get them paid as they can haunt you forever as they don't apply to the seven year fall off rule.

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