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Trying to Rehab a Federal Student Loan? Be careful!

If you are in default on a federal student loan, one option to cure the default is to enter into a 9 or 10 month rehab plan to cure the default.  This can be a paperwork nightmare, with the result ending in wage garnishment if you are not careful.  Once a garnishment starts, it cannot be stopped for five months.  That means that you have to pay a negotiated rehab payment for nine months during which you’ll have 10 paychecks garnished.  Most people’s finances cannot suffer that.

So it’s important to do this right.  Sometimes that doesn’t mean doing it yourself if this is a process you are unfamiliar with.  See what a rep for ACSI (Automated Collections Services, Inc.) said about working with our firm recently.  John advised: “he really appreciated how detailed the firm was with advising them of our client’s situation and how he appreciated that we submitted the supporting documentation straight away. He noted that if other firms implemented a system like ours, it would make his job that much easier. He’s been dealing with student loans and collections for 30 years now and has never come across a firm that has been as thorough with addressing a situation and helping to swiftly rectify it.”

Since this conversation, John has drafted and sent over the garnishment release notice to our client’s employer and had one of his associates follow up with us to get our client on an affordable repayment agreement.  This client approved for a $5.00 rehabilitation plan.

So a happy stress free outcome for our client.  That’s our goal.  And thanks to Kat for doing a terrific job for this client!  For more information about reducing student loan debt or avoiding garnishment, please contact us at

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