Account Control Technology & Student Loan Debt

2022 Update: In 2021, the Department of Education announced that all federal loan delinquencies for the loans it controls would be managed by the Default Resolution Group (DRG) instead of by various collection agencies. Read my article on DRG for up-to-date details on how to contact DRG and what to do if your federal loan is moved to collections. The information in this article may no longer be accurate.

If Account Control Technology is calling you, it’s because you’ve fallen behind on a debt, usually a defaulted student loan, and it was sent to ACT for debt collection. Working with a debt collector can be intimidating, especially when they have the power to garnish your wages, take your tax refund, and offset your Social Security Benefits. Here’s what you need to know when Account Control Technology has your student loans.

Account Control Technology, Inc (ACT) is a debt collection agency and financial service company that handles debt recovery, accounts receivable management, business process outsourcing, and call center services for consumer debts in various industries. ACT’s call centers are located in California (Bakersfield and Woodland Hills), Ohio, and Texas. ACT is not a scam; it is a legitimate company.

Since ACT is a debt collector, they have to comply with the Fair Debt Collection Practices Act (FDCPA), which means they can’t send you harassing phone calls. If you have a negative experience with ACT, you can file a report with the Better Business Bureau (BBB) or the Consumer Financial Protection Bureau.

ACT was recently acquired by TransWorld Systems Inc., making TSI the largest accounts receivable management company in the United States.

Who does Account Control Technology collect for? Account Control Technology collects defaulted student loans for the U.S. Department of Education. ACT also provides client services to consumer financing companies (e.g., credit cards), schools, healthcare entities, etc.

ACT can garnish the wages of student loan borrowers that are in default. ACT does not have to sue you for a student loan before they start garnishing your wages. The U.S. Department of Education allows ACT to send your employer an administrative wage garnishment order after you default.

Before ACT garnishes your wages for other non-student loan debts, they must sue you and get a judgment.

Does Account Control Technology buy student loan debt? Account Control Technology does not buy defaulted federal student loan debt. Instead, the Department of Education, myeddebt, sent the loans to ACT for collections. Once your loans are out of default, the loans will be sent to a student loan servicer.

Student loan borrowers have four options to stop a student loan garnishment from ACT:

• settlement

• loan rehabilitation

• loan consolidation

• student loan bankruptcy

With a student loan settlement, you’ll likely be able to get the collection fees waived and then save about 10-15% of the loan balance. You’ll have 90 days to pay the settlement amount.

Loan rehabilitation gets you out of default after you make 9 monthly payments. Your payment will either be based on your discretionary income or monthly income and expenses. Loan consolidation gets you out of default by paying your defaulted student loans with a new Direct Consolidation Loan.

Filing bankruptcy will stop the wage garnishment. But it won’t get rid of the student loan debt until you file an adversary proceeding for undue hardship.

Which is better for your credit score: rehabilitation or consolidation? Both loan rehabilitation and consolidation have about the same impact on your credit score. Neither removes the late payments from your credit history. However, loan rehabilitation will remove the default status from your credit report.

• Website: www.accountcontrol.com

• Phone number: 888-830-7770

• Mail: Account Control Technology, Inc., P.O. Box 11750, Bakersfield, CA 93389-1750

• General mail: Account Control Technology, Inc. P.O. Box 471, Kings Mills, OH 45034