Legal Question in Credit and Debt Law in California
harassment from Financial Management for collection
My son took out a student loan 1978 or 79 from Student Aid Commission for $12,000.00. Made no payments and it accured to $26,000. Financial Asset Management will settle with him for $16,000. or attach his wages. They won't give him a payment plan except 60 days for whole amount. They call him continuously at work with their threats. What is his legal recourse? He cannot pay the amt. owed and has no resource for borrowing. Can they attach wages? can he claim bankruptcy (which he doesn't want to do)
1 Answer from Attorneys
Re: harassment from Financial Management for collection
Your son is in a difficult spot. The Federal Fair
Debt Collection Practices Act, which prohibits some
harassment by collection agencies, doesn't apply to
student loans. Also, student loans are not dischargeable
in bankruptcy. If your son doesn't pay, they will
get a judgment against him and attach his wages.
Frankly, the offer to accept $16,000 is pretty
generous, and he should raise the money any way he
can and pay it. Bankruptcy might be able to help
him manage the payment of the debt, so he should
consult with a bankruptcy attorney if he cannot raise the
$16,000.
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