Whoa! Was not expecting that from Sallie Mae

[gingerbug]

The co-signer on our Sallie Mae career training loan has been getting those fun calls from sallie mae - you know the ones, 'give me money or I will squeeze the live out of you'. Good times. Well, we are just past our 341 meeting and discharge is not until end of July. So we call sallie mae to find out if we can go ahead and set up a forbearance since dh was seriously injured at work and cannot work for at least a year. Found out the the entire loan has been transferred to the co-signer and our balance is a great big 0. Well, the person I talked to in customer advocate department is going to check with the bankruptcy department to see if this loan will be discharged (cause of its status as a career training loan) or if after we get our discharge it will be transferred back into dh's name. Anyone have this happen to them?

[gingerbug]

For the record, I dont really believe that it will be discharged, I just want to know if this is standard, to transfer loan into co-signers name and such.

[BornAgain]

For the record, I dont really believe that it will be discharged.

Wait! Why the negative thinking?

Anyway, it effectively (but not technically) has been discharged.

Remember the bkforum mantra -- "It's a business decision. It's a business decision. It's a business decision."

[jennordhavn]

The co-signer on our Sallie Mae career training loan has been getting those fun calls from sallie mae - you know the ones, 'give me money or I will squeeze the live out of you'. Good times. Well, we are just past our 341 meeting and discharge is not until end of July. So we call sallie mae to find out if we can go ahead and set up a forbearance since dh was seriously injured at work and cannot work for at least a year. Found out the the entire loan has been transferred to the co-signer and our balance is a great big 0. Well, the person I talked to in customer advocate department is going to check with the bankruptcy department to see if this loan will be discharged (cause of its status as a career training loan) or if after we get our discharge it will be transferred back into dh's name. Anyone have this happen to them?

Yes, I had the same thing happen. My parents cosigned my bar study loan with Sallie Mae. I continued making the payments during the BK but my online account access was blocked, so I had to mail the payments. I sent my first payment after filing and then my Mom called to let me know SM was calling her saying the payment wasn't made. I called them and they told me the loan was transferred to the cosigner's name and a new account number was assigned. They had applied the payment I sent to my other (Stafford) loans that were in deferment because I had written my account number (even though I did put the account number of the private, bar study loan). She told me that once I was discharged, everything would be transferred back into my name.

So I continued to make payments to the new account number. When I was discharged I called to find out if I should begin making payments to the old account number again and had a heck of time finding someone who knew what they were talking about. I was told by two different reps that they couldn't transfer the loan back. I decided to wait it out and lo and behold, just the other day I got a letter from SM saying that my student loans weren't discharged in the BK and they have reinstated my online access. Only my Staffords were listed on the letter. I logged in and my bar study loan is listed along with my Staffords and shows all the payments I made during the BK.

Sorry this was so long, but just wanted to share my experience with you. It should all resolve itself eventually. I was discharged in March and they didn't transfer it back to my name and give me online access until May. Also, while it currently shows you owe ZERO, if you don't make the payments, the cosigner will be responsible for them, so you should probably go ahead and send payments in (unless your cosigner is willing to pay it). Make sure to put the new account number though.

P.S. I thought it was funny that the rep wouldn't give me the new account number without first calling my Mom to verify that it was ok to talk to me about the loan!

[BornAgain]

P.S. I thought it was funny that the rep wouldn't give me the new account number without first calling my Mom to verify that it was ok to talk to me about the loan!

Ha! That is funny. We're never to old to need that proverbial "Note from your Mother."

[JRScott]

It is standard procedure to move to the co signer on any debt when bankruptcy is filed.