Hi everyone, I have been lurking at the site since Oct of 2008 when my husband due to a medical accident had to file bankruptcy 13 in his name. He filed Oct.31 at payback of 100% unsecured loans ( medical bills, dental bills, and cc) and we pay all our secured , house, car and RV outside the bk plan. Prior to this we had never missed any payments on any secured or non secured loans nor were we late. Due to his medical bills he had to declare bankruptcy 13. We were just finally confirmed on March 24 09. I have no idea why so long either for the confirmation either! But we are finally confirmed and I am grateful! I do not really understand how all of this works but I have a question regarding our two children’s college loans and a rant about how much I hate Sallie Mae!. We cosigned for our son’s loans through Sallie Mae and we have always made the interest payments on his loans. He will be a junior this year, he should be a senior however he had to miss a a year due to surgery and illness. Our youngest..daughter we have parent plus loans out..she also will be a junior this year. She attends a different college from our son and she has about half her tuition given to her in a scholarship from the college due to her grades plus work study. However we needed to get a parent plus loan to supplement the rest of the her school fee. We make the interest payments on her loans and our son’s loans.
One thing that happened to us which I wanted to explain in order to help someone else who might have children in college before they sign on 13. When my husband did this..his lawyer did not tell him that the loans he had taken out for our children would be cancelled. Perhaps the lawyer did not know this however since she is a bankruptcy lawyer full time I would have expected her to have seen this coming! If we had known we would have started ball rolling in October to find ways to keep the kids in school. We had no idea this would happen until we received frantic phone calls from our daughter in the midst of her winter quarter January telling us that the finance dept at her school had left her an email stating her loan had been cancelled. Same with our son..his loan is one where we just co-signed so its not a parent plus. In his case, somehow Sallie Mae thought HE had declared bankruptcy !
We had to scramble and refill out the FAFSA for our daughter thinking that due to our bankruptcy our daughter might be given some type of federal grant. THAT DID NOT happen…what did happen is that Parent Plus..the loan we originally had..accepted our new application! My husband’s lawyer had told him to apply for a new loan which would be denied and that would put our daughter in a new category with FaFSA too..which would have entitled her to I guess more help. Due to my husband’s wage we have never gotten any low loans. Instead Parent Plus went back to July ..3 months before my husband filed and used that credit score. Is that legal?
My husband had to call his trustee to get permission to take this NEW loan out which was granted, however, the college then tacked on a 300 dollar fee to reprocess the new loan. To me this was so shady that Sallie Mae does this sort of thing…its like kicking someone when they are already down. Not to mention the utter frustration of numerous phone calls made by my husband trying to find someone in Sallie Mae who would talk to us and explain why they cancelled the first loan and WHY they decided to accept the new loan. No one would tell him anything!
I think this cost us 4,000 dollars..as our daughter would have qualified for that amount if our “ New “ loan had been rejected. We were told that when a parent files bankruptcy new money becomes available to a child after you fill out the Fafsa. Something about being put in a different category. I do not understand WHY Parent Plus cancelled the original loan but then turned around and made us a NEW loan by going back pre bankruptcy filing for our credit score. Also, they will not allow us to view or pay on this new account via electronic..in fact I have continued to make the monthly interest payments however I have no records from them at all..I keep every one of my cancelled checks to prove that we have paid monthy.
Oh they also upped the amount we pay..we ONLY found this out due to my husband calling them and being told we had not paid.. He told them we sent you the payment and was told but your payment is now double that amount! This is so frustrating! We had no idea that our payment was now double due to not being sent any paperwork. I have no idea if they are tacking on extra interest or where they are applying the money I am still sending them.
Our poor son went through two months of calling Sallie Mae and getting a different person each time..most who did not speak English well trying to explain that he personally had not gone bankrupt.. Eventually we had to get his uncle to cosign a new loan for him. This has enabled both our children to finish this years schooling however I have no idea what to do in regard to them going back to school in the fall. But no one is getting much sleep here! Any suggestions ?
We can not take out another loan for our daughter via trustee rule. Sorry this is long, I just had to vent regarding how awful Sallie Mae is to work with. We also pay for our son’s interest on his loans..once again with no paper work coming from Sallie Mae to see if they are applying the payments we make..if they are adding interest in places we don’t know about..its just a nightmare! If anyone has gone through this and can give me some information regarding how to deal with these people I would really appreciate it. Also if anyone has had a child in college and filed a 13..can you recommend ways we might be able to help our children get loans for next year?
I am wondering what will happen when we file with FAFSA again this year ..which its now time to do for August of 09. I am so worried, I feel so awful that our children are in this mess with us. Sorry, this is so long, I have gone back and looked at previous posts regarding Sallie Mae hoping to find some information, however I have not seen anyone go through this issue with loans. Once again sorry for long post..I guess I have just held all this in pent up since October and lurking. Thanks to so many here who by posting their experiences helped me to ward off some problems that might have happened to us in other areas of my husband’s 13.
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