Trying to negotiate a debt with collection agency

[Anonymous]

If it makes a difference, the agency did not buy the loan, but rather, were hired by the college I owe the debt to. It is for an institutional loan that I thought was part of what I was already paying the feds, but recently popped up.

Details: the loan is from more than 10 years ago
Principal: $2,000
Interest: $2102.75
Creditor Assessed Costs: $1758.32
Total: $5861.07

What I can afford right now is about $75/month. I *could* get a loan for up to $3,000, pay off this debt, then pay the loan monthly, however, they said the college will accept no less than $4750.

My concern about paying monthly is that interest will continue to accrue at a rate of 9.160% so the hole will continue to grow bigger while I try to get out of it.

Any advice for me? My credit is decent and I've never gotten myself into this sort of situation before.

[Anonymous]

Don't let the collector scare you. You can settle with them, typically for 60% of the original balance. There are statute of limitations with ANY kind of debt (including student loans). Federal student loans have no statute of limitations for collections. Private student loans almost all have a 5-7 year statute of limitation on them but that will depend on where you live. If the statute of limitations have expired (which I'm 99 % sure they have since you said it's a 10 year old debt) they CAN'T sue you. They can send you the statements that you owe, but they can't legally force you to pay the debt. Hope this helps.

[Anonymous]

Anonymous wrote: Don't let the collector scare you. You can settle with them, typically for 60% of the original balance. There are statute of limitations with ANY kind of debt (including student loans). Federal student loans have no statute of limitations for collections. Private student loans almost all have a 5-7 year statute of limitation on them but that will depend on where you live. If the statute of limitations have expired (which I'm 99 % sure they have since you said it's a 10 year old debt) they CAN'T sue you. They can send you the statements that you owe, but they can't legally force you to pay the debt. Hope this helps.

OP here - thanks. If I ever need a transcript from this college in the future, though (which I likely will), then I'm screwed.

[Anonymous]

OP, my husband and I are in the same situation as you and know with certainty that obtaining a transcript has ZERO to do with your debt. Your school has been paid in full (via the loans) and CAN'T legally refuse to give you your transcript because of student debt. Your debt (which has since expired) is owed to the loan holder, NOT THE SCHOOL. Don't be scared for no reason.
Signed,
Been there.

[Anonymous]

Anonymous wrote: OP, my husband and I are in the same situation as you and know with certainty that obtaining a transcript has ZERO to do with your debt. Your school has been paid in full (via the loans) and CAN'T legally refuse to give you your transcript because of student debt. Your debt (which has since expired) is owed to the loan holder, NOT THE SCHOOL. Don't be scared for no reason.
Signed,
Been there.

Really? How did you prove this to the school?

[Anonymous]

Anonymous wrote: OP, my husband and I are in the same situation as you and know with certainty that obtaining a transcript has ZERO to do with your debt. Your school has been paid in full (via the loans) and CAN'T legally refuse to give you your transcript because of student debt. Your debt (which has since expired) is owed to the loan holder, NOT THE SCHOOL. Don't be scared for no reason.
Signed,
Been there.

OP here - is this true even if it was an institutional loan - not a fed loan? It was an institutional loan that I believe was funded by a loan fund named after a school legacy.

How did you prove this to the school and get them to budge?

[Anonymous]

It is true regardless of the loan type. It is ILLEGAL for the school to refuse to give you a transcript because of a debt you owe to someone else. The school has already been paid in full for your time there at the school. Also, it's impossible for a loan holder to act on behalf of the school (as you say) because colleges/universities DON'T participate in collecting of debts...that's an issue with the collection company not the school. If this were the case, millions of graduates every year would not be able to get their transcripts because of defaulted loan debt. The schools are always the middle man between you and the school. We have both fed and private loans so I know I'm 100% correct. If you are having trouble with the school or obtaining your transcript, find a lawyer as you will can and should sue them. Know your rights

[Anonymous]

Unless you did not pay tuition? Call the school and ask for your transcripts. Your debt with the loan holder is between you and the loan holder, not the school. If they say otherwise ask the school to send you something in writing. (you may have to make the request in writing with a registered letter..make sure there is a paper trail)

[Anonymous]

Anonymous wrote: Don't let the collector scare you. You can settle with them, typically for 60% of the original balance. There are statute of limitations with ANY kind of debt (including student loans). Federal student loans have no statute of limitations for collections. Private student loans almost all have a 5-7 year statute of limitation on them but that will depend on where you live. If the statute of limitations have expired (which I'm 99 % sure they have since you said it's a 10 year old debt) they CAN'T sue you. They can send you the statements that you owe, but they can't legally force you to pay the debt. Hope this helps.

If you can come up with cash offer them $1500-$2000 to settle the debt. Don't get sucked into payments. They should be willing to settle for less than/close to the original amount.

[Anonymous]

Offer to pay the principal balance and a reasonable rate of interest and nothing more. Screw the "creditor assessed cost" -- that's usury and probably illegal. You don't actually owe that.

[Anonymous]

Unless she feels a moral obligation to pay, she doesn't actually have to pay the debt as the statute of limitations have expired. It was a 10 year old debt and It was likely on her credit report for seven years so for the past three years its off her report. I would just leave it alone or offer them a settlement.

[Anonymous]

When it goes to a collection agency, they buy the debt for 10 cent on the dollar.