Where did my student loans go?

[researchnerd]

I had approx $68k in student loans consolidated with Sallie Mae. After I filed Ch13 in May, Sallie Mae cancelled my automatic payments and locked me out of online access. I called them and they said they automatically put me into forbearance for a year, or until BK discharge, whichever comes first -- and said they would contact me when I needed to start making payments again.

Last week I got a letter from Sallie Mae saying that I need to start making payments again. They sent me a bill for a little over $300 -- which is the total balance! They've broken that down into monthly payments of $30.

Now, I am not complaining that $67k+ of my loan has magically disappeared, but I'm wondering where it went. I had a momentary glimmer of hope that it had been discharged, but I suspect that is highly unlikely. Sallie Mae's website shows a large one-time payment of about $66k in mid-August, so either I have a fairy godmother I don't know about, or they sold my loan without noting the account. A new TL for USA Funds has hit my credit report over the past few weeks, but it has a $0 balance. I checked the online NSLDS and it lists my account with Sallie Mae and still in BK. Any idea what's going on?

[nc73]

your loan gets transferred to a collection agency and they get it back after your bk. you still owe the money trust me.

[KeithDoxen]

I had approx $68k in student loans consolidated with Sallie Mae. After I filed Ch13 in May, Sallie Mae cancelled my automatic payments and locked me out of online access. I called them and they said they automatically put me into forbearance for a year, or until BK discharge, whichever comes first -- and said they would contact me when I needed to start making payments again.

Last week I got a letter from Sallie Mae saying that I need to start making payments again. They sent me a bill for a little over $300 -- which is the total balance! They've broken that down into monthly payments of $30.

Now, I am not complaining that $67k+ of my loan has magically disappeared, but I'm wondering where it went. I had a momentary glimmer of hope that it had been discharged, but I suspect that is highly unlikely. Sallie Mae's website shows a large one-time payment of about $66k in mid-August, so either I have a fairy godmother I don't know about, or they sold my loan without noting the account. A new TL for USA Funds has hit my credit report over the past few weeks, but it has a $0 balance. I checked the online NSLDS and it lists my account with Sallie Mae and still in BK. Any idea what's going on?

Sounds like they may have sold the debt outright. Since they were putting you into forbearance during the bankrutpcy, there would have been no need to send everything over to a collection agency, as you wouldn't have defaulted during the bankruptcy process. My guess is they decided you weren't worth dealing with and probably sold your debt for a lump sum to a junk debt buyer. You will find out who this new owner is in the very near future!

[KeithDoxen]

I just googled USA Funds. They don't seem to be a debt buyer. Sounds more like a non-profit lender. I wonder if they are the non-profit guarantor of your loan. If so, that would explain why they hit your credit report, as they may have paid Sallie Mae in full as the guarantor of your debt, and will now be coming after you for the balance.

Either way, someone owns this debt.

[Nicollette]

When my Ch 13 was filed, my student loans went to a company called ECMC. Not exactly sure who they are, but that's where the Trustee sends my payments to.

[Jbgraham]

Researchnerd,
Did you ever figure out where your loans went to?
I was recently discharged from Chapter 13, and Sallie Mae has me owing them $0. I know that 18 months ago when we first filed our chapter 13, I owed $18,000. My credit report lists Sallie Mae with a $0 balance, and a note sating "paid by insurance" (definitely not my insurance though).
I just want to know where my debt went so it doesn't sneak up on me later.
Thanks

[researchnerd]

Oh yeah, my loans magically re-appeared about 6 months after discharge. I almost had a heart attack when I saw the first bill because they defaulted to a 1-year payment plan, with monthly payments over $6,000! But I called them and they put me back on the 30-year plan for now. The balance is actually a little higher now though, because interest still accrued over the year I wasn't paying. Arrgghh.