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Thanks Folks, for the responses so far. To answer a couple of questions...Yes, these were consolidated Federal loans that I defaulted on. And no,the forgiveness for teachers program won't apply to me. It looks like I may need to get a lawyer, and great idea to anonymously inquire about payoff policies. I'm planning to act on both of those suggestions.

The Collection Agency is "General Revenue Corporation". I never rehabilitated the loan because the agency assured me that unless I did there would be no collection costs, and so I thought I could not have to pay the 18% collection costs. I was very poor at the time and was just "putting it off" with the monthly payment. Somewhere along the line they started adding 18% to each payment... I realize now how stupid I was to not keep up with all this. They sent me no statements of any kind for those years.

Although the responses have been helpful, I still would like anyone's opinion on my original two questions:
1) Why all of this does not appear on my credit reports? (I'm scared it might suddenly appear if I pay it off) and
2) Does anyone ever offer a lump sum payment less than 100% to these agencies even though it's a student loan, as it is as it says on my statement, a "purchased" loan?
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