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Question:
Dear Steve,
I had two citi-student loans and at some point in time within the last 5 years they went to Navient (Sallie Mae)
I recently called to ask if I could get a lower pay-off amount as the original loans were 32K and now they are up to about 64K because of deferment and interest. They said no and I believe these may have been private loans.
My conditions have changed. I was born into Islam, but never knew much about my religion. Since 2012 I have been learning more about my faith and it is strictly forbidden in my faith to have dealings with interest.
I am offering to pay off the original amount I owe however due to religious reasons would like them to recognize that my awareness and conditions have changed from the time of originally accepting the loan with Citi-Student Loan Corp and not even with them at Sallie Mae.
Can I get the interest wiped out and close this account and case with just paying the original amount borrowed?
I am in the Seattle, WA area are there attorneys that you can direct me to that can help?
Amir
Answer:
Dear Amir,
Yes, I am very familiar with the issues surrounding the Islamic approach to interest. You might enjoy reading Debt & Religion: A Look at the Islamic View of Debt With Imam Asal.
Asking any lender to adjust their terms and conditions after the fact for religious reasons is just not going to happen.
You've also learned a painful lesson, the damage caused by deferment is enormous. Most people think it is an innocent time not to make payments and get a payment vacation. In fact it just puts the debt in turbo and the interest causes the balances to explode.
The next issue is if you will have the money on hand to settle. You'll need to either need to payoff the settlement in one payment or three or four.
If you don't have funds available to do that then you might want to talk to your mosque about Zakat, "a muslim charitable fund that followers may ask for help from in order to repay problem debt. Zakat is a obligatory charity for Muslim followers." - Source
But even considering all those facts above, if your faith is guiding your repayment then you'll have to seek wise counsel on how to deal with what the the Imam told me. He said, even those that borrowed with interest, are obligated to repay their entire debt and if they don't they will prohibited from entering paradise when they die.
How you overcome that little issue is above my pay grade.
originally posted by: ketsuko
a reply to: Anyafaj
Really? We've never had that offer.
All they do is offer us the "income sensitive option." It's a real winner. You go from affordable to payments that basically assume you would be getting a near 100% income boost within the next 6 months. Every time we offered to pay them what we could, even just pay off the interest, they would offer us that, and then when we turned that down because it's insane, they'd put us back on deferment or the full amount of payment.
originally posted by: r0xor
a reply to: Ultralight
If there was a greed reduction and the loaners would accept the original amount owed without interest, PLUS a fee, they'd not only get a lot of income from it, they'd make a small profit, and the debtors would be free to pursue greater monetary goals in life.
Instead, they hike interest, in the knowledge (hopefully) that many will never repay.
I don't know, I'd rather get something with a small gain than nothing at all. Especially if the future livelihood of hundreds of thousands or even millions of debtors was at stake. It would create more future business in several areas.
originally posted by: Ultralight
My religion does not allow me to pay taxes, interest, dues, fee, etc.. Nice try, right?
Well SOMEONE had to try this in a question to the Huffington Post:
Question:
Dear Steve,
I had two citi-student loans and at some point in time within the last 5 years they went to Navient (Sallie Mae)
I recently called to ask if I could get a lower pay-off amount as the original loans were 32K and now they are up to about 64K because of deferment and interest. They said no and I believe these may have been private loans.
My conditions have changed. I was born into Islam, but never knew much about my religion. Since 2012 I have been learning more about my faith and it is strictly forbidden in my faith to have dealings with interest.
I am offering to pay off the original amount I owe however due to religious reasons would like them to recognize that my awareness and conditions have changed from the time of originally accepting the loan with Citi-Student Loan Corp and not even with them at Sallie Mae.
Can I get the interest wiped out and close this account and case with just paying the original amount borrowed?
I am in the Seattle, WA area are there attorneys that you can direct me to that can help?
Amir
Can you guess the answer?
Answer:
Dear Amir,
Yes, I am very familiar with the issues surrounding the Islamic approach to interest. You might enjoy reading Debt & Religion: A Look at the Islamic View of Debt With Imam Asal.
Asking any lender to adjust their terms and conditions after the fact for religious reasons is just not going to happen.
You've also learned a painful lesson, the damage caused by deferment is enormous. Most people think it is an innocent time not to make payments and get a payment vacation. In fact it just puts the debt in turbo and the interest causes the balances to explode.
The next issue is if you will have the money on hand to settle. You'll need to either need to payoff the settlement in one payment or three or four.
If you don't have funds available to do that then you might want to talk to your mosque about Zakat, "a muslim charitable fund that followers may ask for help from in order to repay problem debt. Zakat is a obligatory charity for Muslim followers." - Source
But even considering all those facts above, if your faith is guiding your repayment then you'll have to seek wise counsel on how to deal with what the the Imam told me. He said, even those that borrowed with interest, are obligated to repay their entire debt and if they don't they will prohibited from entering paradise when they die.
How you overcome that little issue is above my pay grade.
If only we could all wipe clean our interest owed, taxes owed, fees owed....due to our newly founded religious beliefs.
Source