I have approx 20K in student loans in default.
I hadn't had any correspondence from the collection agency who now owns my debt, Windham Professionals, in several years.
Out of the blue, I receive a call from a Windham rep (again, 3 or 4 years since any contact) asking me to pay the loan in full. I negotiated a payment of $125/month. This negotiation came with some amount of hassle. I asked to fill out an Income & Expenses form - they denied me that, saying it was unnecessary and kept insisting on their unreasonable payment. Finally, when push came to shove and I basically told them to accept my offer or begin the garnishment process which I will in turn challenge through the appropriate channels, the agreed to my terms.
I then asked for a and EFT (Electronic Funds Transfer authorization document) and the rep told me that they do not operate this way - they operate on verbal authorization, which I gave, albeit with some amount of reservation.
Now, a month later, after Windham has already made the first of the scheduled monthly withdrawals of $125.00, the same Windham rep just left me a voice mail telling me that we really need to get this thing squared away or the wage garnishment process will begin.
What gives? I have been reading volumes of complaints about this collection agency on the internet, people accusing their collection attempts of being scams, etc.
What should I/can I do now to ensure that I have not stepped into some sort of a scam, and that I am truly paying toward my student loan.
Is this collection agency authorized to garnish my wages to collect on these defaulted federal (EdFund) loans? Should I be wary of this situation?
Huntington Beac, California