February 20, 2008

CuriousGeorge: Student loan bothers I have, for the past 4 months, been making monthly payments to Company X, which is a collection agency, for an old student loan with the NY State Higher Ed folks. I have not missed a payment. Today, I get a call from Company Y asking me to set up payments for my student loan. When I say that I'm already making payment with Company X, they say "well, NY State transferred it to us, and we need to set up a new payment plan." Can they do this?
  • Oh my, yes. Happens all the time - to student loans, mortgages, credit cards, any sort of loan. And the new company usually charges a higher rate. You'll want to verify this is true before sending your money to some random company, of course. They could be lying in order to get your bank account number. But it's most likely legit.
  • "Can they do this?" Seems like another example of Catch 22. They have a right to do anything we can't stop them from doing.
  • I would demand this in writing. Too much shady stuff is done by phone these days. If it's that important, they can write.
  • Yup, second the verifying. Could be legit, could be not. Been personally involved in a scam with one company claiming to have purchased a hospital debt. Shortly thereafter, another company comes on to the scene wanting the full amount of the debt, never mind what I'd sent the hospital in payments and to the first company. A couple days later, I get a call from the hospital. VFU situation!! Takes YEARS to straighten out, and you WILL get at least somewhat screwed. I would verify, verify, verify, to the point of calling your original lender and going into the bank and asking them if their records show this is legit. If not, please report it to the attn general's office as well as the BBB. These jerks need to be stopped. They're preying on the people who are the most venerable financially.
  • If I had a dollar for everything I wish I'd known beforehand about student loans, I could afford to keep up my student loan payments.
  • "Can they do this?" Man, we need better education. Let's start with the predator-prey relationship.
  • 1. Contact company X and ask for a statement of your payments, including balance at time of transfer to company Y. If there's any discrepancy with your records, challenge it immediately. 2. Contact NY State and ask for a statement of your balance. Again, challenge any discrepancy. 3. Let company Y know that in order to set up payments to them, they need first to acknowledge the balance transferred. It's a pain, but you need to make sure that every party is dealing with the same sums of money, otherwise you could end up overpaying.