On February 7, 2018, this company was sued by the Federal Trade Commission for practices related to their student loan debt relief operation. The United States District Court entered a Preliminary Injunction Order on November 29, 2018, and appointed a Receiver to take possession and control of American Financial Benefits Center d/b/a AFB and AF Student Services, AmeriTech Financial, and Financial Education Benefits Center. The Receiver conducted an investigation, issued a report to the Court, and has permanently suspended operations of the businesses.

We recommend that you immediately contact your student loan servicer. A list of student loan servicers can be found at: For free information about repaying your federal student loans, go to

The Receiver has established a webpage with information about the lawsuit which will be periodically updated.

Default Collections

Default CollectionsWhat You Should Know About Default Collections on Student Loans
Default rates for student loans have been on the rise in the United States over that past several years and has become a major economic problem for our country.

Here is what you should know regarding what takes place when a student loan enters into default with the Federal Government.

Consequences of Default

Compared to delinquency, loan default has many more consequences. Default occurs after a loan has gone unpaid for at least 270 consecutive days. Defaulted loans can cause the following:

Negatively Impacted Credit History

Having a default on your credit history will basically ensure that you won’t be able to obtain further credit. This will hurt when trying to buy a car, home or obtain a credit card.

Collection of Wages

Your income can be garnished through the loan collector once you have gone into default. This means that 15 percent of your discretionary income will be paid directly to the collection agency.

Ineligible for Deferment or Forbearance

Loan deferments and forbearances can help you buy some extra time while you try to obtain the money to pay your student loan. While in default, that won’t be a possibility.


Any loan that goes into default is automatically sent to a collections agency. These agencies are very adamant about getting the money back and will try to contact you almost daily.

Tax Return Withholding

While in default status, your tax returns will be completely withheld to pay towards any outstanding student loan debt currently in default. It is possible that you can pay off the entire default amount with this method, but it’s unlikely.

Collection fees, late fees and many other fees are likely to be tacked on by the collections agency as a result of a loan in default.

Legal Action

In some rarer cases, the loan collector can have a case taken to court. This is very uncommon, but it has happened.

Entire Balance Due

Once in default, the entirety of your balance is now due. There are no monthly payments that will be accepted unless it is from withholding or wage garnishment.

How to Get Out of Default

Once you go into default, you have a few options in which you can get out. Here are the ways in which you can achieve that.

Loan Repayment

Clearly, if you are able to pay the entire balance of your loan at one time, then that will remove your loan from default status. Not many will have this capability, so don’t expect it to be an option. However, wage garnishment and tax return withholding may end up repaying the loan as well.

Loan Rehabilitation

The Education Department offers this option by setting up a mutual agreed payment schedule. There may be more fees added to the student loan, but this will remove it from default status. The payments are typically lower and your credit history is cleared from default. If you fail to make your payments through this program, however, you cannot do it again.

Loan Consolidation

If you consolidate your defaulted loan with another loan, this will remove the defaulted status. It is possible to have a consolidation loan also go into default if you fail to make payments. This will acquire fees as well.

Do you still have questions?

Give us a call today at 1-800-488-1490 to find out more about your specific loan structure, the programs that may be available to you, and how to potentially reduce your monthly payments and possibly have your federal student loan debt forgiven!

Minimize Your Student Debt!

Are you looking for help with your student loan debt? Please fill out the form below to have one of our counselors contact you.

If you are an existing client of AFBC, contact us at: Ph. 1-800-488-1490 or [email protected]
Monday - Saturday 8am - 5pm PST

Estimated Federal Loan Balance:

Please fill out the following to confirm prior to submission:

AFBC Client Testimonials

I dealt with Christine Moore with regard to the student loan forgiveness program and she made a believer out of me.  I was quite skeptical with the entire process but with her patience and follow through not only did she get me locked into the perf…

Rebecca W., PA