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Collection Services Since 1986

Borrower Rights and Repayment Options

Loan Repayment

To learn about your repayment options, you can review available payment methods or contact a Delta representative.

Loan Rehabilitation

In addition to the repayment options offered by Delta, you may be eligible to resolve your federal student loan through the loan rehabilitation program. To be eligible for rehabilitation, you will first need to agree upon a reasonable and affordable payment plan with Delta.

Your loan will not be considered rehabilitated until you have voluntarily made nine agreed-upon payments on time over a 10-month period and the loan has been purchased by a lender. It is important to understand that your creditor may add any outstanding collection costs to the principal balance, thus increasing the total amount you owe.

Once your loan is rehabilitated, you may regain eligibility for benefits that were available on your loan before you defaulted. Those benefits may include deferment, forbearance, alternative repayment plans, loan forgiveness and eligibility for additional federal student aid.

Other benefits of loan rehabilitation include:

After rehabilitation, your monthly payment may be more than the amount you paid while you were rehabilitating your loan. Late payments reported to the national credit bureaus before the loan defaulted will not be removed from your credit report.

Loan Consolidation

You may have the additional option to remove your federal student loan out of default through loan consolidation. Loan consolidation allows you to pay off the outstanding combined balance(s) for one or more federal student loans to create a new single loan with a fixed interest rate.

A defaulted federal student loan may be included in a consolidation loan after you’ve made arrangements with your creditor and made several voluntary payments. Usually, you will be required to make at least three consecutive, voluntary and on-time payments prior to consolidation.

Administrative Wage Garnishment

Under the Higher Education Act of 1965, the U.S. Department of Education and guaranty agencies may require your employer to deduct 15% of your disposable income per pay period toward repayment of your defaulted federal student loan. Garnishment may continue until the entire balance of your outstanding loan is paid. You should note that wage garnishment is used only for borrowers who refuse to voluntarily repay their defaulted loan and is not used with those borrowers who continue to make regular and timely monthly payments.

Administrative Wage Garnishment (AWG) is a tool of last resort used to recover defaulted federal student loans. Thirty days prior to the issuance of the Order of Withholding, a notice will be sent to you that advises of intent to garnish wages, as well as your rights and appeal procedures.

You have the right to:

To avoid garnishment of 15% of disposable pay, you must:

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