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If you are an employee of the federal government, you may have recently received from the U.S. Department of Education (Department) a
NOTICE
OF FEDERAL SALARY OFFSET. Your
RIGHTS AND RESPONSIBILITIES are outlined in the insert included with that notice and in the
Department's regulations.
You may avoid offset of your federal salary one of two ways:
- Enter into a voluntary repayment agreement that is acceptable to
the Department, or
- Prove that you do not owe or should not have to repay the debt
Repaying Your Debt Voluntarily
If you want to enter into a repayment agreement at 15% of your disposable pay, you must send a written statement to the Federal Salary Offset (FSO) Unit address provided below, together with a copy of your two most recent pay stubs. To avoid salary offset, you must agree to pay the loan under terms acceptable to the Department, return a signed Repayment Agreement and actually make the first payment under the agreement within 65 days of the
NOTICE OF FEDERAL SALARY OFFSET that was sent to you, and continue to make payments according to your agreement. If you made a request for documents within 20 days of the Notice, you have 15 days from the date the documents were mailed to you to work out a repayment agreement and make the first payment. If you objected to the debt within the deadlines explained in the Notice, but a decision was made denying your objections, you have seven days from the date the decision is mailed to you to work out the agreement and make the first payment. If you do not enter into and maintain an acceptable repayment agreement, the Department may initiate salary offset without further notification.
Hardship: If you Cannot Afford to Pay 15% of your
Disposable Pay
You may feel that making payments equal to 15% of your disposable pay will cause you an
extreme financial hardship by preventing you from meeting the cost of food, housing, clothing, essential transportation, and medical care for you and your dependents. If you want to object on this ground, you must provide credible documentation to the Department that proves the costs incurred by you, your spouse, and any dependents for basic living expenses, and the income available from any source to meet those expenses. If you contend that collection at the rate of 15% of your disposable pay will cause an
extreme financial hardship to you, you must include the following:
- a completed
REQUEST FOR HEARING form and/or a
statement of the reasons for your claim;
- an alternate
repayment amount that you believe will satisfy the debt in
a reasonable time without causing you extreme hardship;
and
- a completed
FINANCIAL DISCLOSURE STATEMENT
together with documents showing the income, assets,
liabilities and expenses of you, your spouse, and your
dependents for last year and for each year of the proposed
salary offset. To make payment arrangements, please call
the FSO Unit at 312-730-1477 (option 2).
Disputing the Debt
There are several grounds upon which you can dispute your responsibility for a federal student loan. These are listed on the
REQUEST FOR HEARING form. Follow the instructions and timeframes provided in the Notice to request a hearing by an official who is independent of the Department.
Send all documentation to:
U.S. Department of Education
Attn: FSO Unit
P.O. Box 617548
Chicago, Illinois 60661-7548
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