Creditors are quick to act by filing tens of thousands of lawsuits every year against borrowers who have fallen behind. Although creditors seem to wield all the power when suing people to recoup student loan debt, there are some defenses debtors can use to halt student loan collection cases.
- All too often, because many student loans change hands from the original lender to other parties, the chain of title can get lost in the shuffle. If a creditor cannot prove that they own your loan, they are out of luck when trying to collect it.
- Many courts have precise rules regarding what business records, such as promissory notes, are required in court and who is qualified to provide verification of their authenticity. Without the proper records and someone to vouch for them, the court case will not move forward.
- Although Uncle Sam knows no limits on time to collect on federal student loans, private loans often have a statute of limitations for collection. If years have passed before a student loan debt collector decides to sue, you may be off the hook depending on the state.
- If your creditor is located out of state, they may be required to register to operate in your area in order to take you to court. In some states, the plaintiff simply lacks the capacity to sue.
- Nothing is easy, even for creditors who are trying to shake you down. Like Dorothy in the Wizard of Oz who must embark on the impossible task of getting the proverbial witch’s broom, creditors are often asked by the court to produce more information. Sometimes the prospect of coming up with additional documents or providing witness accounts is too much in terms of time and energy so they will drop the case.
Are You Being Harassed by Student Loan Debt Collectors?
Contact Peoria Illinois Bankruptcy Lawyer Charles E. Covey For Options
If you are in a difficult financial situation, bankruptcy protection may allow you to discharge many of your debts so that you can tackle others or put you on a payment plan that makes sense for your circumstances. For a free consultation contact Peoria Illinois bankruptcy lawyer Charles E. Covey to discuss strategies that may work for you at 309-674-8125.