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Action Financial Services- Stop Wage Garnishment.


Are you in the process of buying a car, or trying to purchase a home and you recently looked at your credit, and noticed it contains negatively reported information from Action Financial Services and you don’t recognize the company name or the amount of the debt? Are you receiving phone calls and letters from this company, demanding payment for a debt that may or may not be yours? You are not alone.

Every year, the number of student loan borrowers defaulting on their student loan debt is steadily increasing. These loans are then sent to collection agencies to recover the debt. Sometimes it is done in error. Collection agencies are then reporting negative information regarding these defaulted student loans which many borrowers aren’t noticing until they have their credit pulled and find out their scores have dropped. This will catch anyone by surprise.

Now you have a negative mark on your credit and a collection agency using any means necessary to collect a debt. What do you do?

This guide will tell you what you need to know about Action Financial Services, how to deal with them, and what options you have available to get your student loans out of collections.

Why Is Action Financial Services On My Credit Report?

The reason that you may be seeing Action Financial Services on your credit report is because of a student loan debt that is in default. You may not recognize the company because AFS is contracted by the Department of Education to recover defaulted student loans, therefore they are not the original creditor. When your defaulted loan was sent to them, they reported this information to the credit bureaus, indicating that they have acquired your account.

What Does Action Financial Services Do?

AFS specializes in collecting delinquent debts for education lenders. They contact individuals regarding past due obligations in an attempt to recover the debt for their clients.

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Who Are They? How Do I Contact Them?

AFS is a debt collection agency that is based out of Medford, OR. They are primarily a student loan collection agency that has approximately 10 employees and was incorporated in 2009. According to their website, they are dedicated to recouping money lost from non-payment of student loans.

Their contact information is:

Action Financial Services

PO Box 3250

Central Point, OR 97502

Toll-Free: 888-253-4239

Fax: 844-965-9229


Why Is Action Financial Services Calling Me?

The reason you are receiving phone calls from them is an attempt to collect a debt. If you have a defaulted student loan debt, then they are calling regarding this debt.

How to Stop Action Financial Services?

The way to deal with this company is to enforce your rights under the Fair Debt Collection Practices Act(FDCPA). This would include the following:

  • Request in writing the validity of this debt.
  • If they are calling you, ask them for information regarding the original creditor and the amount of the debt.
  • Always log information regarding all communication with this company

We have experienced debt specialists that can assist you with how to handle calls and communication from companies like AFS. Simply pick up the phone and give us a call, and we will be more than happy to help you.

How Can I Get Them To Stop Calling?

There are multiple ways that you can get Action Financial Services to stop calling. One way is by informing them in writing that you wish for them to stop contacting you. With that in mind, you should understand that your debt will still be outstanding, and you will remain responsible for the debt.

If you don’t want to go that route, you can resolve the debt, by getting out of default with your student loans. Or you could inform AFS that you are requesting no further contact and resolve the debt.

If you need help with stopping calls from this company, and you want to discuss strategies to resolve the debt, contact our office to speak with one of our financial loan advisors.

How soon can you be debt free?

Can Action Financial Services Garnish My Wages?

If your loans continue to remain in default status and you fail to resolve the defaulted debt, your wages can be garnished. The Department of Education has the authority to garnish wages for defaulted federal student loan debts, without having to sue you first.

How Can I Stop A Wage Garnishment?

The Department of Education announced that it would provide relief for federal student loan borrowers through Sept. 30, 2020. It has stopped collection activity on defaulted student loans and overpayment of grants, as well as put all student loan payments in a temporary 6-month forbearance. The Department of Education has also set the interest rate at 0% for federal student loans through the payment suspension period.

So what does this mean to you?

It means your loans will not go into default during this 6-month forbearance period. If you are in default, it means that you will not receive letters, calls, or contact from a contracted collection agency during this period. If your wages are being garnished, the garnishment is placed on pause for 6 months.

With all that being said, if you want to stop a wage garnishment or get out of collections or default before one starts, this is the time to take advantage of the opportunity to resolve your debt, because after Sept. 30, 2020, if there are no additional policy changes collections will resume as usual.

If you decide to resolve your defaulted debt, you can do so through a loan rehabilitation. Loan rehabilitation requires that you pay 9 on-time consecutive monthly payments within 10 months. After the 5th payment, your garnishment will cease and once you are out of the rehab period, your default status will be removed and you will be eligible for Federal financial aid and forgiveness programs. You will also have the default removed from your credit report, although the late payment information will remain on your credit.

How Can I Use The 6 Month Period to Rehabilitate My Loans?

If you couldn’t afford this option before the automatic forbearance announcement, the good news is now you can. You can use this time to save money for your payments once the cancellation period is over. During this 6-month cancellation period, all student loan payments are suspended, this includes loans in rehabilitation. This also means that each month of forbearance will count towards the required 9 payments for the rehabilitation program.

For example, if you begin the rehabilitation program at the beginning of May and your first payment would be due towards the end of May, you will receive May, June, July, August, and September as credit towards your rehabilitation. This will leave you with 4 months left to pay on your rehabilitated loans.

What Are My Other Options?

Loan rehabilitation isn’t the only answer for you. You can consolidate your loans, into a new Direct Consolidation Loan, or you can still make payments on your loans or attempt to pay your loan in full.

What Do I Do If My Rights Are Violated By Action Financial Services?

Collection agencies are known to violate consumer rights under the FDCPA, and if you feel that AFS has done any of the following:

  • Called your friends, family, or co-workers regarding your debt
  • Threatened you with violence, a lawsuit, or arrest
  • Intimidated you
  • Used obscene language to collect a debt
  • Try to collect more than you owe
  • Failed to validate your debt
  • Refused to comply with a cease communications request
  • Reported false information to the credit bureaus
  • Used deceptive or misleading language to attempt to collect your debt

Then you may be able to sue AFS for violating your rights under the FDCPA, and you could be awarded up to $1,000 in monetary damages including attorney fees and court costs.

Reviews, Complaints, Lawsuits

According to the BBB, Afs has had 56 total complaints in the last 3 years and 36 of these complaints were closed in the last 12 months. The majority of the complaints were regarding billing and collections issues. This agency has had several claims filed against them for harassing consumers regarding their debts, misleading consumers regarding their debt, threatening to take actions that legally they are unable to, and attempting to collect on debts that are not owed.


Defaulted student loan debt is something that affects millions of Americans that used federal financial aid as a way to fund their education. Many of these borrowers are unaware of what to do when a collection agency contacts them to collect or recover this debt. Therefore they end up being bullied or harassed.

Oftentimes borrowers are unaware of the options and rights that they have to handle or resolve their debt. If you need help with dealing with these agencies and what options you have to get your loans out of default, give us a call and one of our financial loan advisors can help you deal with Action Financial Services.