Can't get my promissory note from Sallie Mae

[el222]

Hi,

Does anyone have any advice on how I can get Sallie Mae to send me a copy of my promissory note? I have requested this 5 times and each time I speak with them they assure me they understand what I am requesting and they will send it to me. Each time they send me my "Promissory Note", all I actually receive is the application form that I filled out prior to getting the loan. It has no information on it whatsoever, except the amount I'm requesting and the % loan fee. From my research, it sounds like the application I signed may serve as my official signature for the Promissory Note, which is fine, I'm not disputing the application. What I need them to send is the contractual terms.

I am 100% insolvent and have $500 left to my name. I have no income currently and will owe Sallie Mae another $300 in early February. By that time, I will either not have the money to pay it at all, or I will need the that money to feed myself. I need to know what will happen if I don't pay it, what the penalties will be, when will it go into default, what state laws I need to follow, etc. I have explained this to them over and over. I have no defaults or forbearances left. I will be filing bankruptcy at some point soon.

How can they not send this to me? My loan is a private loan. I started repaying in 2003. I have never missed a payment. It makes it seem like they are trying to be tricky and not send this to me for a reason. Could they not actually have my Note? Maybe it is missing? Even if it is missing, since my signature won't even show up on the contractual part of the Note, why can't they just fake it and write a new one? They could send me any Promissory Note and I wouldn't know the difference. I'd actually be okay with that, I just need something to go by. I need to make an educated decision on how to handle this.

My cousin is an attorney (not in the bankruptcy field). I plan on asking him to send them a letter on his firm's letterhead to see if that will do anything, but I am pretty confident it will yield no results either.

Any suggestions? Is it legal for them to not send me the actual terms and conditions of my Note?

Thanks,
Ellen

[KeithDoxen]

I would recommend having your cousin, the attorney, spearhead your effort to get the terms and conditions sent to you. I don't think that these terms and conditions will be as helpful as you think they will, though. It sounds as if you are in no position to pay Sallie Mae any more money at this time. Therefore, it's really not going to make any difference what the note says, if you're unable to pay, you're unable to pay.

Defaulting on a private student loan is very similar to defaulting on, say, a credit card, in terms of what happens to you next. The big difference is that you can't discharge the debt via bankruptcy. What happens is that the guarantor, if there is one, will pay the balance in full to the lender. The guarantor will then own the loan and will send the debt to a collection agency, which will send you ominous letters and call you repeatedly, voicing empty threats about how they're going to sue you.

I haven't heard of many who default on their private student loans and get sued the next day. It usually takes several years. If there's no cosigner, and if you really are broke, with no assets and no income or minimal income, you're not going to be a low hanging fruit.

What will happen is that your credit report will suffer, but you're about to file bankruptcy, so your score is already going to be fairly low.

As for needing the note to find out what state's laws control, trust me, this is the least of your worries. This provision will only be enforced by courts in terms of "substantive law." There is no practical effect on a debtor who signed a student loan promissory note in this regard, as the only time a conflict of state law will come into play is if you're sued by the student loan company, at which point you will look at things like statute of limitations, or if they get a judgment, wage garnishment, property exempt from collection, etc. All of those things are controlled by the laws of the state in which you are sued, i.e., the state in which you reside. It doesn't matter what the contract says about conflict of laws, or getting your first-born if you default, etc, the courts will do what the courts will do, and they will apply the laws of your state in these areas. You'd be far better served learning the collection laws of your state than worrying about this promissory note.

[HHM]

Keith is right on the money, the note is of little to no use to you.

[phat2009]

Hey Keith --

Here I am again, poaching on another post of interest to me. What is your knowledge of actually having to deal with collection agencies both pre-court and at-court? Specifically, do they tend to negotiate the total amount owed and monthly payment at all? Are they at all reasonable once in a while? If sued and they win, are you maybe then in a more tenable position with a judge who may agree with you that, no, you cannot make the payments they had been asking you to make before defaulting you and yet would not offer you alternatives, leading the loan down the path to default --thus, getting you a more reasonable repayment plan? Does the court even get involved in that (payment plan one can afford), or is that only with things like restitution in criminal cases? Ever hear of any collection agencies settling for less with a payment that is lower than what one had to pay pre-default, pre- or during litigation?

I am wondering if for some people, since BK does not discharge the student loans, if this is actually the better way to go. Unlike with huge credit card debt, there are not even companies who will help negotiate down the principle or interest rate when it comes to student loans -- at least that I have seen. If you just cannot afford it all, no one will work with you because they have no incentive to, and credit will be ruined anyhow, maybe this is a way to get out from under some of the debt????

Thanks again, you rock!

[HHM]

I have seen settlements on private student loan debt, but not with monthly payment plans

[phat2009]

Thanks -- for some reason I have it in my mind that when it goes to court, that the court can consider your resources and ability to pay, and order a payment plan. Maybe only if the other party agrees? Seems silly to get a judgment against someone if that someone cannot pay it in a lump sum, but can do so if a payment plan was offered. Kind of a you cannot get blood from a turnip theory of repayment.