moved abroad, no income, default on student loans

**snafu** · 08-10-2013, 08:10 AM

Unlike 'traditional' loans there is no forgiveness or expiration date on SLs. Interest continues to accumulate and your credit rating will continue to be negatively impacted. In your shoes I would apply for deferment and stay in touch to actively monitor the interest increases. The really bad thing is that employers often check credit ratings of potential employees and are unlikely to short list or hire those with bad ratings. Should you find employment in the future, the collector can garnishee income.

**chazz1** · 08-10-2013, 09:52 AM

settle after default

and if i default, what are the chances they would be willing to settle for a partial lump sum payment after a few years?

**hamchan** · 08-10-2013, 05:08 PM

Not great because they can just sue you and have forever to collect on it. As long as you are out of the country there is not much, if anything, that they can do to collect. But if you ever plan on coming back to the states you will want to deal with it. Some lawmakers are attempting to change the laws back so that private loans are dischargeable in bankruptcy though. If it happens then you'll have more options.

**ginene** · 08-19-2013, 10:24 AM

Call them and tell them you have no income. My buddy is currently paying $5 a month. If you talk to them they will work with you.

**hamchan** · 08-19-2013, 03:25 PM

Originally posted by ginene View Post

Call them and tell them you have no income. My buddy is currently paying $5 a month. If you talk to them they will work with you.

Not if it's a private loan. They generally will do very little to work with you.

**KTP** · 08-21-2013, 05:35 AM

I think the main reason student loans are not dischargeable in bankruptcy is because you can't return the education to the creditors. What you paid for and learned in school is stuck in your head. The education has the potential to increase future earnings, so they get to garnish the wages of those future earnings until you pay it back.

It sucks but actually isn't totally unfair....until the day when there is some sort of brain wipe and you can actually return the education to the creditors.

**riverwed070707** · 08-21-2013, 05:57 AM

Originally posted by KTP View Post

It sucks but actually isn't totally unfair....until the day when there is some sort of brain wipe and you can actually return the education to the creditors.

This made me lol

Makes me think of MIB

**bigdaddybus** · 08-21-2013, 06:21 AM

Originally posted by chazz1 View Post

hi all

after finishing school with the help of citibank loans (today taken over by sallie mae), i moved abroad to take care of a relative, and have no income. i don't know how long i will be in this situation. my question is if i end up defaulting, how long will sallie mae act to collect and how many years will my default negatively affect my credit rating/score?

look at this from the creditors perpective. Whats to say there is a relative to care for? How do they tell you from a scumbag that moved abroad to make money and default on the loans?

I expect your credit rating will be destroyed.....and what creditor wants to led money to someone who was loaned alot of money and doesnt pay it back? Your credit rating will be a warning to other creditors to "STAY AWAY!!!!"

The actions you are taking are the type of actions that make credit more costly for everyone else.

Enjoy your upcoming sub 500 FICO score, You have earned it!

moved abroad, no income, default on student loans