Legal Question in Credit and Debt Law in Pennsylvania

I live in PA, I am married, my husband and I just bought our first home last year, we just bought 2 cars that has both our names on the title and we still owe 4 years on the loan. I don't have a bank account-I use my husbands. I owe 192,000 in student loans. I pay 65 to AES each month and 240 for federal loans serviced by Sallie mae. My private loans are at $1,500 a month which I can't afford so I stopped paying. Pa law does not allow wage garnishment and our deed to the house states that we own the house as tenants in the entirety. It is a 30 year mortgage. What legally can happen to me? Will I be sued and how will Sallie Mae try to get money from me? Should I try bankruptcy or just do nothing. Of course I want to pay it but I don't think "good faith payments" exist anymore and won't help me any? Sallie Mae so far has been unwilling to work with me on a payment that I can afford.

Asked on 7/31/13, 11:01 am

1 Answer from Attorneys

Yes, PA does not allow wage garnishment but student loans are not ordinary debts. If they are public (through the US DoE) then they can garnish your wages without even going through a lawsuit. They can garnish up to 10% to 15% of your pay. Private student loans are also subject to garnishment.

42 Pa.C.S.A. 8127 Personal earnings exempt from process

(a) General rule and exceptions.--The wages, salaries and commissions of individuals shall while in the hands of the employer be exempt from any attachment, execution or other process except upon an action or proceeding:

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(4) Under the act of August 7, 1963 (P.L. 549, No. 290), [FN2] referred to as the Pennsylvania Higher Education Assistance Agency Act.

If you have this much student loan debt you need to see a bankruptcy attorney. While student loan debts generally are not dischargeable, there is a hardship exception. Some or all of your student loans may qualify.

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Answered on 7/31/13, 10:07 pm

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