U.S. Loans, Immigrating to Canada—What Happens?
Dear Betsy,
I have $30K in student loans. I have been trying to pay them, and some were in forbearance. My loans (thanks to Sallie Mae and others) are constantly being sold, etc… I got a copy of my credit to determine who owned my loans. It has been a huge paper trail. I will soon be immigrating permanently to Canada from the U.S. What happens now? I have tried to apply for forbearance since I am not working, but since I will not be in the U.S. and not collecting unemployment or registered for unemployment, I do not qualify for forbearance. I would like to negotiate something but am getting the run around and Sallie Mae is demanding $2700 U.S. which is a lot more in Canadian dollars (due to the exchange rate) and with me not working, isn’t an option. What can I do? I do not want to carry around this burden, but at the same time, the loan holders are not even willing to negotiate with me. I heard that if it goes to the FEDs for litigation, I can be arrested if I enter the U.S., is this true?
Thanks!,
Sara
Dear Sara,
You’re actually talking about 2 different things here. It’s true, you’re not eligible to postpone payment on your student loans if you are unemployed and seeking work outside the U.S. That particular option is actually called an unemployment deferment—not a forbearance. Forbearance is another option to postpone payment on your loans. Unless you’ve already used the 36 – 60 months that Sallie Mae allows, your [loan] should be eligible for this option while you seek employment. If you have already used the limit, you are going to need to bring your loans current, then apply for a lower payment option such as the graduated repayment option, consolidation or income sensitive repayment option. Regarding what will happen if your loans default and eventually go through litigation—yes—there is a chance that you could be arrested coming back into the States. But why set yourself up for that and a bad credit rating? I know you say you’re in Canada for good, but you never know what will happen a few years down the road. I’d try to work this out now.
Good Luck,
Betsy
