Before I even get into my explanation, I want to say thank you for creating this site. Its unfortunate that the 1st Amendment is the only thing that protects us (student borrowers) from deceitful companies like Sallie Mae. With that said I'm in deep and I mean deep trouble. In 2000 I was convince by my University that Sallie Mae was the best option I had for supplementing my Stafford loans. I was told that the Sallie Mae private loans were among the best, with the lowest interest rate. Needless to say 5 years later I graduated with 2 degrees, no job, and quite a bit of debt, $36,000.00 of which belonged to Sallie Mae. Now in October of 2008 I have a Masters Degree, a job, and $57,000.00+ in Sallie Mae debt. Apparently its possible to acrue $17,600.00 in interest during three months of forebearance time, because that's what Sallie Mae capitalized and added to the principal of my loan. I was in grad school for a year and a half unable to pay. Sounds to me like I was bamboozalled, because that $17,600 may have acrued during that time. Until a week ago I was unemployed. I had no means of making a payment to them. I had no choice but to forebearance, however they didn't want to hear that. Instead they wanted a "good faith payment"+ $150 in order for me to utilize more forebearance time. I'm now 50 days deliquent, owe them $1,490.00 and broke. I haven't even received my first pay check and I'm about to default on a loan. This story has quite a bit to it. I've spoken to the ignorant people in their call center, collections agents, and account specialists. All of them have told me to pay. I can't. I just don't have the means. Unfortunately that doesn't matter to them. What should I do?

Congratulations on your accomplishments! You're in much better shape than those who dropped out and didn't get their degrees. At least you have that much going for you!

Yes, the loan situation sucks. I would pay whatever you can afford to. It shows that you're making an effort. The employees in the call center aren't necessarily ignorant. They're following a generic script, and have no power to do otherwise. The people in collections, however, generally do not have souls or much of an eduction. Some of them really are great people, but I don't believe they last long in the Collections Department at Sallie Mae.

Here is an e-mail I received from an ex-Sallie Mae employee:
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Name: Amanda
Date: 2008/07/22 08:00:51

Message: This will make me the bad guy, but for three months, I worked at Sallie Mae. They give you a month of training so that you can understand how student loans work and then they send you to the call center floor. They never really prepare you for the real job that you are doing. Collecting. You are a collector, taught to be hard nosed and without feelings to all of the excuses of why a person can't pay. I have made so many people cry. It was easy at first. You start in 30 day delinquency where people usually just forgot to send the payment. in 30 day they also still have a lot of options like forbearance. Then after 3 weeks you go into a different departement where people are 60 or 90 days delinquent. This is worse. They have no options and the amount due is higher. If you can't get a payment, you have to get a second voice, a supervisor gets on the phone and tells them that they will default on the loan and we can garnish up to 90% of wages and social security. Some pay, but some still can't. Then we continue calling everyday til they pay. Sometimes 20-30 times until someone actually answers the phone. We actually get prizes and bonuses for the amount we collect. It's the only reason anyone stays. I hated my job. I wanted to whip out my credit card and pay everyone's loan. I never felt so guilty doing my job. It depressed me. There were people who had lost their job, had gotten hurt and was now on disability,r those who were living out of their cars or shelters, and Sallie Mae still wanted their money. Sure, some people didn't want to pay, but others truly couldn't. I got screamed at everyday. There was a man who almost had his loan paid off. He had gotten hurt on the job and couldn't work. His disability had not went through yet so he had no money. His wife was working a part time job.Something she had not had to do in 20 years. They were broke. This man cried because he said if he paid the payment, I would be taking food off his table. He truly wanted to pay. I believe that. He just couldn't. I almost cried with him. I had to get the second the voice and told my supervisor the situation. He got on there and told the guy that he wasn't trying hard enough and was a deadbeat. It was horrible. Another person had just got out of law school. She got pregnant and had complications of a weak heart. She has had two open heart surgeries and her baby is barely three, she can't work, she gets food stamps and SSI, she is very embarrased, she want to pay, but she only gets $351 a month in SSI and her monthly loan payment is over $600. How is she supposed to pay? She now gets calls everyday demanding money, she is stressed by all of this and this is bad on her heart. I can't do a job where I feel like a criminal. I am still looking for another job, but I don't need Sallie Mae's money anymore.
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My advice to you is to pay whatever you can. It shows that you're willing to make an effort, and they can't fault you for it. Don't get me wrong, though. They'll fault you big time for not making the entire payment in full and then some. I'm surprised their collections employees don't require that you give them tips. Most of the collections employees I've dealt with over there probably think they deserve tips.

Chris

One thing that is a big thing for everyone to know that has a student loan. You are the borrower, you signed your PROMISORY NOTE to say that you will pay this amount within this time. The intrest that accrews is from either the account not being taken care of or that someone is not doing their part. SallieMae is trying to do their job by trying to get ahold of YOU, the borrower to absolve a deleqency.

Here's some advise.

COMMUNICATION!!!! When you feel that SallieMae is not contacting you through e-mail or mail, CALL THEM. Take 5 mintues out of your day to just do an update on your student loan, that way when you feel that you are missing a payment or something isn't right, call them to correct the matter. Whether it be through payment, deferment (BIG THING THERE TO APPLY FOR IF YOU ARE NOT ABLE TO MAKE PAYMENTS, IT HAS A LOT OF BENEFITS!!) or forbearance (if you still have the time to use it).

DON'T USE ALL OF YOUR FORBEARANCE AT ONE TIME. When people call in to do 12 month forbearances they have no clue as to what it can do. Intrest acrews during a forbearance and any unpaid intrest is capitalized to the principal amoutn of the loan (that is if you are not making payments while in the forbearance period). When you feel that you are not going to make a payment for sometime, try qualifying for a deferment then at the last option you have use a forbearance for only a few months to get your current (like if you were 20 days delequent and you want to get that taken care of so you can make a payment in January) do that, that won't hurt as bad as trying to apply for 12 mos.

READ YOUR PROMISORY NOTE! That is a huge thing when coming to grips to what your student loan is about and what obligations and consesquence you have as a borrower to take care of the loan. A lot of information is about intrest, acrewing intrest, ect. All of it is in your promisory note. Don't have one? Request it and keep it in your personal records so that when you have a question, read it. Still not answered. Call (going back to communication).

MAKE SURE THAT YOU HAVE ONE BILLING GROUP. I've read on here that a lot of people are upset that SallieMae isn't applying payments to the right accounts. When you call to make a payment, make sure you have the right payment amount, and ASK if you have more than one billing group; that way when you write the check or money order put a note on there with your account number and which billing group you want the payment to be applied to.

MAKE PAYMENTS TO THE PRINCIPAL. Yeah, intrest is going to acrew on the loan because well it's a loan paying back money with an intrest rate that you have so much time to pay back. When making a payment on the phone make sure that you apply a payment to the prinicpal amount to the loan rather than just not saying anything. That way you'll see your principal amount go down a WHOLE lot faster than just not saying anything. You'll see a big difference.

I hope that helps anyone who is trying to get their student loan paid off. Congrats on trying to get this taken care of. When in doubt always try to make a payment and it doesn't have to be the monthly. Yeah SallieMae will get upset but hey at least you are trying to get this taken care of where you'll never have to do it again.

uknbeknown2u wrote:

QUOTE:
COMMUNICATION!!!! When you feel that SallieMae is not contacting you through e-mail or mail, CALL THEM. Take 5 mintues out of your day to just do an update on your student loan, that way when you feel that you are missing a payment or something isn't right, call them to correct the matter.

Thank you for the post, uknbeknown2u. You made a lot of great points, but I would like to add something and then ask you a question.

This site is not for people who got themselves into a mess with Sallie Mae. There are a lot of people out there who automatically assume the borrower is at fault when they fall behind, but it's not ALWAYS the borrower's fault. I don't want to hear from people who only have themselves to blame. I have no sympathy for them.

What should people do when they're not getting anywhere with Sallie Mae or another lender? If you read my post, you'll see that I tried everything I could but got nowhere for months. I'm not alone, either.

Chris

Thank you Chris.

I can tell you I wasn't at fault in this situation. I had all of my loans reviewed by a student loan professional who questioned the outrageous interest rates, specifics of the promissory note, the fact that I received letters from sallie mae stating nothing more than the terms of your agreement have changed, and the capitalization of so much interest over a short amount of time. I fell behind because I was unemployed and unable to pay the high monthly payment. Sometimes there are circumstances beyond our control. There's insurance out there for every situation. Why not have a safeguard in place for individuals who fall on hard times and have no recourse?

To give you an update, since my post, I'm paid up, and actually ahead 2 months now. But some people aren't as fortunate as I am. I had to do without for 2 months while trying to catch up. My issue isn't just with Sallie Mae. Its with the private student loan industry in general. How can an industry exist that is supposed to help better you future when it does nothing but continually harass you an demand more and higher payments on a regular basis? Since paying off, Sallie Mae has demanded that I except the terms of a new agreement that would double my monthly payments. I said NO!

uknbeknown2u, tell me what are people supposed to do when they have no recourse like I did? I tried consolidation early on and no one, I mean no one wanted to touch Sallie Mae loans for a consolidation. An exact quote from a loan consolidation counselor at Citi Assist,

"In the past we've had major issues consolidating Sallie Mae private loans. We've had incorrect often higher payoff balances than were given to consolidation applicants reported to us by Sallie Mae as well refusal letters stating that the loan was already sold. Because of these issues and several complaints by individuals consolidating these loans, we've found its not within our companies best interests to do so."

That's right out of a letter from Citibank addressed to me in July of this year before the economic crisis. Wells Fargo sent me a similar letter.

I made a few micropayments to Sallie Mae. They credit reported me anyways, ruined my credit and forced me into a higher security deposit for my apartment. Thank you Sallie Mae.

I was forced to sell off personal possessions just to keep up. Do you suggest that people go out and sell off everything? Or better yet, let's not pay the rent/ mortage, electric bill, heat bill, water, sewer or garbage and eat saltines and drink rain water for sustainance. We're already on our way to a depression, let's start the trend early and bring in depression style living so we can be the envy of the neighborhood. It breaks my heart to know that people are suffering during these times. It hurts me even more when I find out that its because they've had a student loan issue.

The point I'm making is this: I understand what this website is here for. Its not here for someone to vent. Its here for individuals that have no recourse. You want to provide suggestions, that's great. Schools do not do a very good job of educating you as to what you have to expect with student loans. Exit interviews are a joke. They just want you to sign on the dotted line so they get their money.

Don't talk to people like they're stupid and make it seem like its their fault. Government doesn't seem to want to help. With the exception of recent legislation requiring colleges and universities to exhaust public assistnace first, there are no protections for student loan borrowers. The private student loan industry is like a kid with a magnifying glass. When they realized their power they started to play God. Sorry that doesn't fly with me.

I work in government and I'm trying to find a way to protect the little guy day in and day out. I've done countless hours of research. I would like to get together with people from this website and brainstorm. I want to protect student borrowers via legislation and ensure that the lobbying machine for the private student loan industry is stopped once and for all.

On a side note, the whole explanation you gave was exactly the same that was conveyed to me by a Sallie Mae Customer Service Advocate. In fact its pretty much word for word. Congrats. I take it you must work for them or with them in some capacity.

Chris, I would love to get in contact with you about several issues. I may need you testify before a committee as to your experiences.