Question about student loans?

[AValdoux]

Can they freeze your bank accounts and seize assets, including a house, if you default on your student loan? Can they put you in jail?

To make a long story short, someone I know is claiming her bank account was frozen because of her student loans. She had to meet with a judge friday to get access to her checking account. Last year, her crisis was they were going to throw her in jail over her student loans. She is a medical professional (PA) and her loans amount to over $100,000. I've looked on the internet about student loan default and I couldn't see anywhere that they could freeze your assets and throw you in jail. It looks like they would go after her wages first, she makes good money as a PA. She has bent the truth in the past regarding her finances. Is she doing it now? I know they are more aggressive about student loans, but is it that bad?


AValdoux

[Fredda Weinberg]

1. Fraud is a crime

making substantially false statements to obtain credit can land you in jail. That has nothing to do with garnishment or other tools available to the government. We don't have debtor's prisons, but you've described patently criminal acts.

[Drum]

2. In a word: yes.

They can and do freeze bank accounts. If you aren't paying and yet have money, "they" will hold onto your $$ until you make arrangements and pay up. In my case "they" was the US Dept of Education....

[shanine]

3. I've used the forebearance option a few times

for months(8) at a time . . they were always nice to deal with even when I "hid"out from them.
I do know they can take your tax refund. Jail? hope not, never heard that before.

[eppur_se_muova]

4. She would have received multiple warnings from the lender and servicer ...

before things got that far.

I'm envious of someone who has ONLY $100K in student loan debt. I don't make "good money", not compared to medical professionals, and I've had lots of trouble keeping up with payments, but no one has closed my bank account yet. If you are behind, they send you letter after letter, and if you have a phone, they call literally EVERY DAY until you have made *some* kind of arrangement to catch up on payments. This doesn't happen suddenly.

[AZBlue]

5. Being a government agency then can freeze your assets.

Usually they just ruin your credit score almost beyond repair and garnish your wages, but for that amount they might go after assets too. As for jail, it seems extreme, like there might be something else going on too.