After I graduated I had several companies calling me asking me to pay my loan payments over the phone. I refused, stating that I wanted to see my balance and wanted to mail a check in. They said the only way to pay was over the phone. That didn't seem right to me and I had been screwed over by a company before. I paid a debt of just under $500 and it was a fraud. I wasn't going to let that happen again, not so easily anyhow.
Anyhow, long story short, I defaulted on my loans and they take out $190 a paycheck. It's been going on like that for about eight months or so now. The other day I received a call from "Pam" who works for Direct Loans or Pioneer Credit Recovery, she wasn't specific.
She informed me that sending in some paperwork that if approved my loan would show as 'Paid in Full' on my credit report and my payments would be lowered, and also I'd have 20 years to pay them off. Granted, if I took the full 20 years, I'd end up paying 10k on top of my loan after all the interest.
http://www.loanconsolidation.ed.gov/ According to that online calculator my payments would drop to something like $220 a month and I'd be on the Income Contingent Repayment plan.
"Pam" also told me to sign three papers, send them to her, over nighting them which costs $20 bucks then call her back with the tracking number. She says the sooner they get the papers, the sooner they can stop the garnishment and get my credit 'fixed'.
My questions are ...
Does this this sound legit?
What's the difference between Income Contingent and Income Based?
I have the paperwork filled out, but this seems almost too good. Albeit, I'll be paying a few 1,000 more through the duration, but short term it's going to help my credit faster. I think?