Need advice on what I can do.

[Dercas]

Hello, I have some questions hopefully someone can assist me with.

I have a loan that was originally provided from ITT Tech, a student loan, not the typical federal subsidized and unsubsidized loans, it was a temporary credit from them. However once I stopped going to school on this loan payment was to start immediately, ITT tech couldn't accept payments unless it was automatically withdrawn, which I didn't want. They told me to wait and it will go to the company that collects their debts and they can take payments without them being automatically withdrawn.

At the time, I didn't actually realize it would be a collection agency, they made it appear as something different. Anyway, once this collection agency received the debt I contacted them right away, actually a few times before they had even received information on me. I tried to explain I didn't want automatic payments, and that I wanted to send them in myself via cashiers check. They said they couldn't do that either, so I ended up giving them my debit card and they started automatic payments starting in June for a six month time period and i'd call them back after that to confirm the amount and give them my updated debit card info as it would expire the end of December.

They also told me nothing would be reported to my credit as long as the payments were kept. Which they were, withdrawn every month correctly but come to find out they reported it to my credit in November.

I called them, and they said ITT Tech could have reported it back in April (which was around the time I stopped school) because the full balance of the loan was due then. Which is a whole different thing with ITT Tech, however, ITT didn't report it, the collection agency did.

My questions are:

1. Are they still able to report to my credit if I had already setup automatic payment agreements with them?
2. Do I have to setup automatic payments to prevent any further action?
3. Do I have to pay a certain "minimum" amount to prevent any further action?

The reason I ask 2 and 3, is because based off what they did to me already, I don't want to give them any of my info, and they told me when I originally setup payments that they couldn't accept 50.00 a month, and wanted more than that, around 150.00, I ended up getting them to agree to 100.00 a month, but now I would rather send them the least amount possible because of what they did to me.

If they weren't able to report it, what can I do to resolve the issue?

I hope someone can assist me and give me advice on what I should do to resolve this issue.

Thank you,

Cody.

[Willie]

Cody,

No collection agency can ever demand a specific method of payment from you. That is just a tactic so they are consistently collecting money. You can always say no, and tell them how you intend to pay it off, and the amount too. If you want to stop that, you will have to close your account and open a new one, or just open another account for yourself, and just keep your payment amount in the first one. This will keep them "honest" and not allow any extra from coming out.
Also, talk to your bank about this, if you use a community bank, or credit union, they will possibly help you, but stress that you WANT to pay them off, but don't want any shenanigans to happen. If your with a "Big National" bank, I would move my stuff immediately to one of the above types, they won't help you, but they will help the collection agency!
The collection agency can not legally take ANY of your money with out one of two things, your permission, or a court ordered judgment. And they can't get a judgment without taking you to superior court in whatever county you signed the contract in and suing you. That involves a lot of time, and more importantly, MONEY out of their pocket.

To your questions, go and read the Fair Credit Reporting Act, this will give you knowledge for now, and in the future.

For #1) I would dispute the entry with the credit agencies, give them timelines, details of conversations, and names from ITT to now.They are required to investigate. Asking this question, I surmise that you are aware you can get free credit reports? And that you are entitled to the responses when you dispute?

For #2) Definitely not.

For#3) That is up to you to negotiate with them, it's your budget, not theirs!

I applaud you for owning up to your debt, however, you are in control, not them. As long as you are fair and DOCUMENT every contact you have with them, you will prevail.

Disclaimer: These items are my opinions and not to be taken as legal advice.

[rescue me]

Hi Dercas. Here is my take, on the situation - having been both a collector of student loans (which seems what you have, a Perkins loan, correct me if I'm wrong) and a student loan consolidation officer. Officer, hmmm they had a good sense of humor didn't they?

ITT can report denlinquent to credit bureaus as soon as delinquent. Your grammar on Q.1 is a little off and though I think I know what you mean, " Setting up payment w/them", you don't mention who them is. Since you sd you didn't set up payments w/the school presumably you mean the CA.


Do I have to set up direct payments to avoid further action? The GENERAL answer to this would be no. Most CA's know that folks who aren't paying debts aren't doing so because they can't. So, if someone is paying they will usually work w/them. Thing is this is a STUDENT LOAN. Correct if wrong, now I know laws changed since I left stu loan consolidation, but at that time a loan from a school was a Perkins loan, at a lower per cent (5% at that time if I recall correctly) in 06. Student loans operate under different rules than do regular loans. When I worked at the collection agency for delinquent student loans we didn't even need a summons to get a judgement on student, just the signature of the official in the state, in charge of stu loans (forgot the political position), and a collection agency without a lawyer could obtain a judgement and grab your income tax refund, lien any bank accts we knew of. We usually didn't though. Believe it, or not, we knew that the youngsters were having a hard time, and as long as they were making payments, we didn't go to the judgement thing. If the students were uncooperative, or nasty and abusive, bing they got hit, and I took many calls explaining the co.'s right to take the recent graduates income tax refund.

Your other question about a certain amount falls into the same category. In credit card situations w/debtors, often the agencies are lacking the cards to collect, and many of the debtors on cr. cards are broke usually. Stu loans, however the Coll. agency is holding a High Straigt Flush, though they usually don't play the hand.

All student loan payers, or any student one who has a student loan should join, or be in touch with Higher Ed Watch. Please Google, they are on Facebook also. This is the Washington, D.C. pro-student organization that was successful in 2006 in finally getting the reform movement rolling regarding student loans. They have blog sites, and I believe are still fighting banking interests over certain types of student loans previously insured by the Govt. Hmmmm seems lately banks only like to loan if the loans are insured by the govt. Sorry, couldn't resist the "bigger picture" joke, well sort of a joke. Yup, get to, join, whatever, higher ed watch is the students rep in D.C.

I know banks have more representation then people in D.C. (couldn't resist, again) but Higher Ed Watch has done a good job and should be helpful.

Not legal advice, i.e. anything written here.

Depends if the collection agency will work w/you. To lower your payments. Also it is a good general rule not to let auto payments be drafted from accts, again general. There is an electric co. I know of that will charge a $300 reconnect fee for one day late. Exception to the rule.

After you get income tax refund, might want to "try them", if the payments are effecting your lifestyle (not talking about partying, ability to pay rent etc.), but remember they usually do work w/students,,,,,,,,,,,,,,but don't have to.