<p>I applied for a grad plus loan in May 2012. I was approved with an endorser. We both signed the MPN electronically. Te funds were disbursed to me in June. I completed the graduate program I was participating in. In August, the school called and said there had been an error in the transmission o paperwork, and the government had taken the funds back from the school. They asked me and my endorser to go and re-sign the MPN, to resubmit the loan. By this time, my endorser was no longer willing to endorse the loan. The school’s position is that if I do not find an endorser or a loan on my own, I will owe the school this money. This is fine with me, but It seems to me that I should at least get to pay this money back under the terms I promised, as it was there error. I would like to know what my rights/options are. Thank you very much for your help!</p>
<p>And there are a few typos here as I am using my phone:/</p>
<p>If your endorser backed out, they got lucky and you got unlucky with the error. I don’t think there’s anything you can do but try to find another endorser. </p>
<p>What has happened between August and now? Have you been allowed to attend school anyhow even though they haven’t been paid?</p>
<p>Thank you for the response. I finished school this summer. It was a summer intensive certificate program, graduate level so it qualified me for grad plus loan. They put my paperwork through with the incorrect origination fee. Someone screwed up. My frustration is that I did everything correctly.</p>
<p>You did everything correctly, but you apparently never really had a willing endorser. You’re not being penalized because of the error, you’re being penalized because you don’t have a willing endorser. The only thing the error did was allow the endorser a second chance to back out which they wouldn’t normally have had. But if you had a genuinely willing endorser, they’d just re-sign the forms and the error would not be a problem.</p>
<p>Why is the person no longer willing to endorse the loan?</p>
<p>It was a relationship that ended. Not badly, but this person was also about to purchase a house and didn’t want the hit on their credit by the time the school notified me of the issue. Bad timing as much as anything.</p>
<p>Unfortunate. I don’t really have any good advice for you. You’re going to need to find another endorser if you want the loan. </p>
<p>Are you completely done with the school? How do they plan to collect the debt if you can’t get the loan? Can they offer you a payment plan you can afford?</p>
<p>I am done with the school. I have not yet begun to negotiate a payment plan with them which is the main reason for my question. I owe $3400. Any suggestions?</p>
<p>How much can you afford to pay per month?</p>
<p>Here’s the thing – the school is probably not in the habit of making loans. They may or may not have a standard payment plan they offer. And even if they do, you may not qualify since it’s for a past term. </p>
<p>Do you need anything from them (release of your transcript etc.)? If not then you’re in a stronger position to ask them to work something out with you. Their recourse is to send the debt to collections and destroy your credit, something you should do your best to avoid. But… if you are reasonable and go in and say that you intend to pay them everything you owe them but you can’t come up with it all at once, and make a reasonable offer, they may accept it. It depends how big a bureaucracy the particular school is. Do not bother complaining to them about how you did everything right and got screwed over by a transmission error. They won’t care. Just tell them you plan to pay and tell them what you can afford, and see if they will accept it. </p>
<p>If they won’t accept your proposal, ask them what will happen if you can’t pay.</p>
<p>I don’t need anything from them, have my certificate, doubt I will need transcripts for quite a while. I can afford 100-150/month.</p>
<p>I don’t think they’ll accept a payment plan that takes you over a year to pay it back. Chances are they will put it into collections which will hurt your credit for quite a while.</p>
<p>Any chance of getting a parent or other relative to co-sign the loan? It’s not really that much money. Do you have a credit card? I hate to even suggest it because of the crazy interest rates they usually charge, but occasionally you can get them to offer you 0% interest for some number of months on a cash advance (but there would be a fee for that).</p>