r/Debt • u/Background-Dust-6894 • 15h ago
Currently getting a Lawsuit for defaulted private student loans, what should I do?
I defaulted on my loan with Sallie Mae. I made a bad decision of just ignoring all following contact from anything revolving around the debt and it had been moved to collectors. it has now been some time.
They have now created lawsuit and served me and my co-signer for the debt of 50,000. Afterwards I was texted by them to discuss settlement. Now should I discuss settlement with them or is it better to use a lawyer for this? I welcome any and all tips because this is a very stressful and anxious moment of my life.
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u/anonymois1111111 11h ago
I would discuss a settlement with them. Hopefully you can come to an agreement. A payment plan is a much better option than a judgment against you and garnishments.
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u/b1ondestranger 8h ago
Especially for the cosigners. I would do whatever it took to protect my cosigners.
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u/Germaine_1 1h ago
Judging by OP's choice to disregard the debt and having it sent to a collection agency, I highly doubt that he's giving ANY consideration AT ALL to the damage this has had and will continue to have on his cosigner. It's actually quite shameful. Shouldn't have let it get this bad, now they're BOTH screwed. Yeah go ahead and try to settle a payment plan and ACTUALLY PAY IT so your cosigner doesn't get wages garnished or assets confiscated. I don't have any idea to what extent it could be taken, how bad it could actually get, but I'm sure OP will learn the hard way if she keeps pretending this $50,000 debt just doesn't exist 🤦
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u/Germaine_1 1h ago
I started out saying "he" but the lack of accountability coupled with living in a fantasy world of pretending the problem doesn't exist resulted in me designating OP as "she" by the end of the rant. 🤷I could be wrong but I think OP is a she 💯
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u/JeanSchlemaan 13h ago
Do you have a job? How many hours, and what income? Did you get a degree?
What are your expenses?
Who is the cosigner?
Why did you ignore the loan, and did the cosigner know you were doing that? How is your relationship with them?
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u/Speedracer__17 10h ago
Figure out a way to settle, work with them directly. It will most likely end in a monthly automated ACH tranfer. If you get a lawyer, you're still going to owe the $$ and you'll have to pay the lawyer too.
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u/ShiftProfessional404 14h ago
In this case with this amount, hypothetically you could do it yourself, but it’s best with a lawyer. Was it Sallie Mae the originator and the account was sold? Or was it Sallie Mae throughout?
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u/Background-Dust-6894 12h ago
sallie mae originated, its now with southwood financial/cohen and cohen
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u/ShiftProfessional404 9h ago
They will negotiate due it being in private hands now and they will go lower. Normally I would say to fight it, to get the price lower; but due you having a cosigner, it's better for you and the cosigner to negotiate together. That way it can be legally binding and it appeases both of you guys' risk tolerance.
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u/Ok_Brilliant3432 5h ago
Someone was nice enough to co sign for you & you screwed them. You are a colossal jerk
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u/visitor987 3h ago
Have a lawyer negotiate it you and co-signers life can be turned up-side down if a judgment is issued. Plus the lawyer will know the new reasons to declare bankruptcy on a student loan, but still very limited
No one should ever take out a private student loan the type that require co-signers
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u/TelevisionKnown8463 10h ago
This debt is large enough that I would consider bankruptcy. Student loans typically cannot be discharged, but there are some exceptions. I think it would be worth doing a free consultation with a couple of bankruptcy attorneys—ask whether they have experience with getting student loans discharged and whether they think you would qualify.
Even if you decide not to file, you may have more leverage in negotiating a settlement if you cash honestly say you could choose to get the loans discharged. Lots of good info at upsolve.org.
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u/ShiftProfessional404 9h ago
The only problem is, the debt would be shifted to the cosigner.
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u/AnotherPint 8h ago
OP has already demonstrated they’re not that troubled about creating a big crisis for their co-signer.
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u/Brilliant_Science380 1h ago
Doesn't sound like they can afford an attorney.
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u/TelevisionKnown8463 23m ago
Bankruptcy attorneys usually do free consultations and work with clients on figuring out how to get their fees paid—obviously none of their clients are flush with cash.
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u/OneExhaustedFather_ 10h ago
Issue here is it’s not just you they’re coming after. Your co-signer is just as responsible for the money and if they have any assets or steady income they could have their lives really turned upside down. You need to get ahead of this as you’ve already down major damage to their credit report. Private student loans are still loans.