Statute of Limitations for Federal & Private Student Loans

What is the statute of limitations for student loans?

If I took out a student loan 10 years ago and haven't paid it off yet, do I still have to pay it? What is the statute of limitations for student loans?

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  • Federal student loans have not statute of limitations.
  • Private student loans are subject to state statutes of limitations.

Thank you for your question about statute of limitations on student loans.

You did not specify whether your loans are federal student loans or private student loans. This distinction is huge, as the statute of limitations for federal student loans and for private student loans are not the same.

Check the Dept. of Education’s National Student Loan Data System (NSLDS) to see if the loan is federal. State statutes of limitations do not apply to federal loans, and are subject to collection indefinitely. Student loans not backed by federal grants or guarantees do not appear in the NSLDS, and are therefore private. Private student loans are subject to state statutes of limitations.

Federal Student Loans

The bad news: Due to changes in federal laws in 1998 and 2005, collection on federal student loans now have no statute of limitation and — with very limited exceptions — can no longer be erased though bankruptcy.

The good news: There are many options available for student loan resolution, some of them quite flexible. Depending on the specifics of the situation, student loan borrowers may be eligible for programs that offer extended repayment periods, modifications that are income-sensitive (income based repayment or income contingent repayment, or graduated (starting small and rise over time). Some plans also offer possibility of “rehabilitating” a defaulted loan, so that some or all negative information about the loan is expunged from the borrower’s credit report if certain criteria are met.

Several federal and state agencies offer programs to help you cancel or reduce all or a portion of your student loan debt. Student loan forgiveness programs involve you making and honoring a long term commitment to teaching, nursing, or military service. To learn about some of the specific forgiveness programs available and how you can apply, visit the Federal Student Aid Web site.

Struggling with debt questions? Let the Bills.com Debt Coach review your debts and give you your options to resolving these debts.

Private Student Loans

Private student loans have entirely different rules for statutes of limitations. Unlike federal student loans, private student loans are subject to state’s statute of limitations for taking legal action to collect on written contracts. Once the statute of limitations expires, you can raise the statute of limitations as a defense, if the creditor attempts to take legal action to collect on the debt. However, just because the statute of limitations passes does not mean that a creditor or collection agent cannot try to collect on the debt. If you make a payment on a debt whose statute of limitations has passed, you can bring an expired debt back to life.

The statutes of limitations start running 30 days after your last payment on the debt. If you think that the statute of limitations for a private student loan debt is about to expire, I encourage you to consult with an attorney in your area to discuss the implications of an expired statute, and what actions you need to avoid to prevent the statute of limitations from being tolled or restarted.

The statute of limitations for a written contract no longer apply if the creditor or collection agency sues you, before the statute of limitations expires, and obtains a judgment against you. If that happens, you will be subject to wage garnishments, bank levies, and liens.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

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  • 35x35
    Jan, 2013
    Cynthia
    I cosigned a Sallie Mae, private, tuition answer, student loan over six years ago. The signer has not made a single payment. Has the statute of limitation ran out on this loan? I've sent dispute letters to three or four different collection agencies. These letters were certified. The collection agencies did not respond in the 30 days given as I requested. Will I still be liable?
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      Cynthia, you raise a tricky question. Each state has its own statute of limitations for breach of contract. You did not mention in which state you reside, or where the primary borrower resided when he or she signed the loan. Also, depending on the language in the original loan documents, it is possible another state's SOL laws would apply. Let us say for the sake of argument you reside in California, the primary borrower resides in Texas or Florida, and the Sallie Mae contract states everyone agrees to use the laws of Pennsylvania, where Sallie Mae has its mailing address. All of these states have a 4-year statute of limitations, so answering your question is easy — a court hearing this case would use a 4-year statute of limitations.

      However, if Sallie Mae files an action against one of you and you and the primary borrower reside in other states with longer statutes of limitations, the local court may use a longer statute of limitations. Our advice? Take a copy of the loan contract to a local lawyer who has civil litigation experience. He or she will read the contract, review its choice-of-laws clause, ask you questions about the primary borrower's state of residence, and give you a better answer than I shared here. In the meantime, read the Bills.com article What Is My Statute of Limitations? for a longer discussion of this difficult issue.

      Regarding the debt validation letter you mentioned, consumers have a 30-day window to validate a debt, but the Fair Debt Collection Practices Act is vague on how much time a collection agent has to respond to a debt validation letter.
      0 Votes

  • 35x35
    Jun, 2012
    Rick
    I am still a student. I have 3.5 years left of becoming a doctor. I keep getting calls for late payments but BOA refuses to accept the letter of enrollment. I am frustrated with this.
    0 Votes

  • 35x35
    May, 2012
    Dario
    I was just reading about loan forgiveness. I served, and was honorably discharged from the Armed Forces after serving for seven years. I also taught undergraduate students at a State University for one year, another year as a State Social Worker and three years as a Paralegal.That's twelve years. Do I qualify for the ten-year needed for loan forgiveness? Thanks again for your informative answers.
    0 Votes

    • 35x35
      May, 2012
      Bill
      Dario, there are rules about applying for the forgiveness program and the number of years a person needs to make payments under the program, in order to get the debt forgiven.

      Contact the Federal Student Aid Information Center at (800) 433-3243, or visit the Dept. of Education's Student Aid Web page. To see a detailed outline of the program for public service employees read the document Loan Forgiveness for Public Service Employees.
      0 Votes

  • 35x35
    May, 2012
    olga
    I graduated from college in 1972 using the GI Bill. A couple of months ago I received a letter from the Treasury Dept. that I owed an unspecified amount, and they began taking $98.00 a month from my Social Security benefit. The debt is 40 years old. Do I have any recourse to have the loan forgiven. Also, does the Statute of Limitations applies to debts incurred prior to the law becoming effective.Is that law retroactive to old debts? Thanks for your help. By the way, I have been adjudged disabled by Social Security, does that help? God Bless You.
    0 Votes

    • 35x35
      May, 2012
      Bill
      First, do you owe anything on your student loans? If you repaid them in full, then attack that area first. I don't know many people who keep records from 40 years ago, but if you can show you paid your debt down to a zero balance, then you have an excellent starting place to stop the administrative offset.

      I am not aware of any statute of limitations for federal student loans regardless of when the debt occurred.

      Regarding loan forgiveness, if you worked in public service (such as police, fire, public school, and so on) for ten years during your career, you may have an argument for a Public Service Loan Forgiveness. See the Federal Student Aid Debt Resolution Web site to learn if you can request a hearing to reduce the amount offset from your Social Security benefit.
      1 Votes

    • 35x35
      May, 2012
      raul
      There are no statute of limitations for federal student loans. However, there ARE statute of limitations for bank robberies, kidnappings, thefts, etc. etc. Isn't there something wrong about this?
      3 Votes

    • 35x35
      May, 2012
      Bill
      I realize you ask a rhetorical question, but I can't resist getting sucked into responding. The policy behind statutes of limitations on crimes are to encourage police and prosecutors to pursue investigating and prosecuting crimes quickly, relatively speaking. Because evidence and memories tend to degrade or be lost over time, the framers of the Constitution tried to create safeguards to assure due process. They wanted to avoid depriving people of their liberty, and took the stance that it is better to let a guilty person go free than imprison an innocent.

      A student loan cannot be compared to a crime. Applying for a student loan is a voluntary act. If an applicant does not like the terms of a student loan, he or she is free to walk away from the offer. Indeed, many people earn college degrees without loans, so student loans are not requirements or prerequisites for a college or trade school education.
      2 Votes

  • 35x35
    Apr, 2012
    Spring
    Are your student loans still collectible if they were taken out prior to the law changes in 1998?
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      Bankruptcy laws apply to cases filed as of that date, and not the bankruptcy law in effect when the debts were incurred. In other words, when Congress made big changes to bankruptcy law in 1978 and 2005, those changes applied to cases filed on or after October 1, 1979 and October 17, 2005, respectively.
      0 Votes

  • 35x35
    Dec, 2011
    Brownie
    Can the government or collection designee take money from a 401K to collect defaulted student loans?
    0 Votes

    • 35x35
      Dec, 2011
      Bill
      I am unable to find any authority given to the Dept. of Education or state guaranty agencies under US Code Title 20, Chapter 28, Subchapter IV, Part F to levy retirement or pension accounts. However, the Dept. of Education and state guaranty agencies have the authority to file an action (a lawsuit in court) against a delinquent borrower. This relatively rare event would occur if the Dept. of Education had evidence of fraud, embezzlement, or other crime involving a student loan.
      0 Votes

  • 35x35
    Oct, 2011
    Ron
    Bill what is the statute of limitations on a student loan in 1988 and does the 1998 law retro back or is it for that year and up to current?
    0 Votes

    • 35x35
      Nov, 2011
      Bill
      From my research it appears that there is no statute of limitations on federal loans, even those that originated before the 1998 law. If you feel that you don't owe the money or wish to receive an answer from someone who is licensed to dispense legal advice about the statute of limitations for your very old student loans, then you should speak to an attorney.
      0 Votes

  • 35x35
    Oct, 2011
    Beenthere
    In dealing with FMS - No one there talks to the others Totally. If the notes don't get in the computer... by their mistake - IT'S YOUR FAULT and you still have to Prove What You Are Complaining About.
    0 Votes

  • 35x35
    Oct, 2011
    MJ
    I got a student loan in 1991. I no longer see it on my credit report but I got a wage garnishment threat from goldsmith and hull. The loan was $2000 now I owe $5000. Can this really happen? It says my name VS United States. Please help.
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      Just because a debt does not appear on your credit report it does not mean that you no longer have financial responsibility to pay it. Speak with an attorney to see if you have any grounds for stopping the wage garnishment.
      0 Votes

  • 35x35
    Aug, 2011
    Edith
    Recently, I received a relative's bill from a collection agency. The difference between the original amt. and the interest accrued is nearly 1300 dollars. There was no communication from the college about this debt (which supposedly was from over twenty years ago) even though we have had solicitations for donations. What can we do? Does the statute of limitations stand for a federal student loan if it had already passed by the time these laws were put into place?
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      In my experience, college alumni associations are the most adept people-finding organizations on the planet. The same cannot be said for college's accounts receivable offices. It would make sense for them to combine forces, but that does not seem to happen, as your anecdote illustrates.

      Is the debt related to a federal student loan? Private loan? An unpaid housing or lab fee? If, as you mentioned, this relates to a federal student loan, there is no statute of limitations on federal student loans. Were you a co-signor on the loan? If so, then you have liability for the debt. If you were not a co-signer, you have no liability.
      0 Votes

  • 35x35
    Jul, 2011
    Renee
    I have a student loan that was in deferment because I lost my job in 2009, and it recently came out of deferment in Feb 2010. Here is the catch, Sallie Mae did not contact me in any way to let me know that I had reached the end of my deferment, and when I spoke to them today I was given dates when emails and letters were sent out. I have lived at the same address for the past 3 years, and have never received any letters or emails from them saying my deferment was up. They sold my account to another company in April of this year, and the new company has not contacted me one time about the debt,and in May they put it on my credit report as being in default. I happened to pull my credit report today and saw it. Since it has come out of default in Feb 10 until now my debt has went from 18,000 to 27,000. If I had known it was out of deferment I would have made arrangements for payments. Is there anything I can do?
    0 Votes

    • 35x35
      Jul, 2011
      Bill
      I am unable to tell you whether or not you had a responsibility to know the status of your loan, regardless of whether or not you received the communications from the lender.

      You can speak to a lawyer, to see if the lack of timely communication gives you any grounds to challenge the $9,000 increase.
      0 Votes

    • 35x35
      Jul, 2011
      Rosalie
      Hello, I live in California and back in 1986 I visited a vocational school for information - I signed a few documents that they said they would submit to see if I qualified for a student loan. I told them I was 17 and that I would need to talk to my mom before the actual paperwork was signed and they agreed. I guess the loan went through as I was contacted today regarding it. Can you tell me if the government can go pursue someone who did not attend the school and who was under age at the time the docs were signed?
      0 Votes

    • 35x35
      Aug, 2011
      Bill
      Consult with a lawyer who has consumer law experience to learn what, if any, liability you have for the loan. First, most courts will not enforce a contract signed by a minor. However, an exception was created for student loans at some point relatively recently, and the lawyer you meet will research this further. Second, applying for a loan and accepting the funds are two different things. You do not state whether you attended the school or accepted the funds, so it is unclear to me if you have any liability whatsoever. Third, you do not state whether the loan was private or federal, and different collection rules apply for each. Finally, I urge you to, in addition to consulting with a lawyer, validate the debt immediately.
      0 Votes

  • 35x35
    Jul, 2011
    chuck
    hey bill i took out a student loan for vocational training at Superior training for heavy equipment operation back in 1987 and am just now being told i owe 5 times the origanal amount due to late fees and interest.i don't know if this is a federal loan or private loan.how can i find out.and bye the way i have never paid a penny on this loan due to the school being a scam but can they take my tax refund anyways? i appreciate your your response,gypsy..
    1 Votes

    • 35x35
      Jul, 2011
      Bill
      Consult with a lawyer in your state who has consumer law experience. He or she will review your loan documents to help you learn if your loan is federal or private, and if the set-off on the tax return is appropriate under the circumstances.
      0 Votes

  • 35x35
    Jun, 2011
    Matt
    My wife had a student loan that she put into chapter 13 in 1993 and was discharged in 1997. She inadvertantly opened a can of worms with the school when she requested a transcript. Now they are demanding repayment and are threatening her with a lawsuit. If this was discharged in 1997, does she owe anything on the loan? It was accepted into her chap 13 bankruptcy and they are claiming it does not matter. Please help!
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      If the discharge occurred before the bankruptcy rules changes that all but outlawed the discharge of student loans, then the school has no leg to stand on and is in violation of federal law, in my opinion. Consult with a bankruptcy lawyer, and be prepared to sue your spouse's alma mater.
      0 Votes

  • 35x35
    May, 2011
    Jennifer
    There is a statute of limitations for criminal acts. But there is no statute for student loan debt? That shows you what the government cares about.
    0 Votes

  • 35x35
    Feb, 2011
    Vic
    I am in a truly unique situation. My wife (who I am not in talking terms with now, but we're still married) took out student loans (SOLELY IN HER NAME) (without my knowledge) to the tune of $34000 back in 2004. Recently when I filed joint tax returns for 2009, I was shocked that they had intercepted MY TAX REFUND (money which I, MYSELF, earned, not my wife) and applied it to these loans which I do not owe a dime on (possibly because we live in a community property state - CA). I tried to file an "injured spouse" claim, but it appears that they can "collect from all so called community property". I'm terrified now!! PLEASE HELP! Can these people do other things like garnish MY wages, sue me etc., even though I have led a SPOTLESS life?? (unlike my wife, who does not seem to care for her obligations). Will filing "married filing separately" prevent MY tax refund from being siezed?...and finally can these people stalk me for the rest of my life, even if I divorce my wife (considering that these student loans were acquired during our marriage)?? THANK YOU so much for your help!!
    0 Votes

    • 35x35
      Feb, 2011
      Bill
      Consult with a California lawyer who has experience in family law. Consider filing for divorce. I realize some live apart from an estranged spouse and never divorce for moral or religious reasons, but you have an option in California to file for a separation, which has many of the benefits of divorce but without using the "D" word. Upon separation or divorce in California, a spouse's student loans become separate property, which is unique for community debt in California. A California family lawyer will probably tell you the recent tax return is a lost cause, but a divorce/separation will prevent the Dept. of Education from garnishing your wages and seizing next year's tax return. Again, consult with a lawyer experienced in family law who can analyze your situation in person and give you precise advice.
      0 Votes

    • 35x35
      Feb, 2011
      Hugh
      Thank you for your help Sir! I consolidated both private and subsidized loans under the Direct Loan program. Have the private loans become "subsidized" as well? That is can I go back and pay off the government subsidized Plus loans and default on the private ones? Loans were taken about 20 years ago, consolidated about 15 years ago under the Direct Loan plan. Thank you! Hugh
      0 Votes

    • 35x35
      Feb, 2011
      Tina
      You can file an Injured Spouse form with the IRS either with or after filing your taxes by itself. The form is located on the IRS web site. Your return will be mailed to you rather than direct deposit (if that's what you chose) but at least you'll get what's yours!
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      Thank you for your suggestion.
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      Today, private loans may not be consolidated in the Dept. of Education Direct Loan consolidation program. Perhaps the rules changed in the last 15 years, and you consolidated your private loans when this was possible, but that is purely speculation on my part. Take your Direct Loan documents to a lawyer who has contracts experience. He or she will, after reviewing your consolidation contract, give you precise answers to your questions.
      0 Votes

    • 35x35
      Apr, 2011
      Bud
      What is Sallie Mae is handling your private loans? Is this possible that Sallie Mae handles a private loan?
      1 Votes

    • 35x35
      Apr, 2011
      Bill
      Sallie Mae is a lender of private (and federal) student loans.
      1 Votes

    • 35x35
      Apr, 2011
      Bud
      So all their loans are private? I thought they were government loans?
      1 Votes

    • 35x35
      Apr, 2011
      Bill
      Sallie Mae is the largest student loan lender in the US. It lends federally backed and private student loans.
      1 Votes

  • 35x35
    Jan, 2011
    Angie
    I graduated in 1998, but i think that i consolidated the loan in 2003. I thought that when that happened the loan was bought by a private lender. I didn't understand all the terms at the time. Now I'm being haunted by NCO financial. I only make $16000/yr and have worked as a secretary in a low income school for the past 6 yrs. I have 3 children at home. They are trying to garnish my wages, but haow can they do that when my income is below poverty level? Will my working in a low income school help to discharge even part of the loans? How can I aviod the garnishment when I can't afford to pay them and still provide for my family w/o having to send them 20+ pages of documents every 6 months?
    0 Votes

    • 35x35
      Jan, 2011
      Bill
      Wage garnishment rules can vary by state, but all states may not allow a judgment-creditor to garnish more than what is allowed by federal law. Based on your e-mail address, I will assume you are an Arkansas resident. Arkansas, for all intents and purposes, uses the federal garnishment rules. I will not quote all of the rules here, but one paragraph goes straight to the point of your question:

      "Title III ... protects employees by limiting the amount of earnings that may be garnished in any workweek or pay period to the lesser of 25 percent of disposable earnings or the amount by which disposable earnings are greater than 30 times the federal minimum hourly wage prescribed by Section 6(a) (1) of the Fair Labor Standards Act of 1938. This limit applies regardless of how many garnishment orders an employer receives. The federal minimum wage is $7.25 per hour effective July 24, 2009." (Dept. of Labor Wages and Hours Worked: Wage Garnishment)

      With these wage garnishment rules in mind, let us run the numbers for your situation. You earn $16,000 per year, which is $307.69 per week, or $7.69 per hour based on a 40-hour week. Twenty-five percent of your gross wages is $76.92. Thirty times the present minimum wage is $217.50. The smaller of these two is $76.92, which is the theoretical maximum amount available for garnishment if you pay zero in federal and state income taxes, nothing in Social Security taxes, and have no other deductions, such as for involuntary pension or medical insurance. The 25% garnishment is based on your disposable earnings which is to say your after-taxes and deductions take-home pay. This answer assumes the consolidation converted any federal loans you had to private. If the loans are federal, the Dept. of Education can garnish 15% of your disposable income.

      Consult with an Arkansas attorney to learn if there are any wage garnishment exemptions I overlooked. If you cannot afford a lawyer, call your county bar association and ask for the name of the organization that provides free legal services to low- and no-income people in your area. Make an appointment with that organization and bring all of the documents you have relating to the student loan and consolidation, and the garnishment notices to the meeting. A lawyer will advise you accordingly.
      0 Votes

  • 35x35
    Dec, 2010
    Rau: Consult with an attorney in your state who has experience either in civil litigation or bankruptcy who can research this issue. I fear, however, that his or her research will find that Congress intended the 1991 amendments to Section 484A(a) of the Higher Education Act of 1965 eliminated the statutes of limitations defense retroactively.
    0 Votes

  • 35x35
    Sep, 2010
    Bill
    Given that your case closed years ago and that you signed a consolidation loan agreement, my feeling is that you are still liable for the student loan debt. However, you have nothing to lose by speaking with a bankruptcy attorney to hear about your options from a legal expert. Most attorneys will offer a free initial consultation. To help locate an attorney and to know what questions to ask him or her, please read about how to find an attorney.
    0 Votes

  • 35x35
    Aug, 2010
    Don
    I filed chapter 13 in 1995 before the laws changed, in 2003 I was forced under duress and threats to sign a consolidation loan for the student loans. Then yesterday I found the enclosed article. My question is can the 2003 contract be forced to be valid or can I contest it and make it invalid? Whether a bankruptcy discharge relieves an individual of his or her obligation to repay a student loan or grant overpayment is now determined by whether a court has ruled that repayment would impose an undue hardship on the borrower and his or her dependents. If the bankruptcy was filed on or after October 8, 1998, the loan or grant obligation is not affected by a bankruptcy discharge unless the debtor received an undue hardship ruling from the court. Prior to October 1998 changes in bankruptcy law, whether a loan or grant overpayment was discharged in a bankruptcy depended on different rules, depending on when bankruptcy was filed, how long the student loan had been in repayment, and what kind of student loan the debtor had received. Generally, loans or grant obligations owed and in repayment for more than five years, and later seven years by the time the borrower filed for bankruptcy relief were dischargeable by reason of the age of the debt. Debts owed and in repayment status for shorter periods were dischargeable only if a court ruled that repayment would pose an undue hardship.
    0 Votes

  • 35x35
    Jun, 2010
    Bill
    To the best of my knowledge, private student loans (i.e., loans that are not subsidized or guaranteed by the federal government) are not subject to the no-statute-of-limitations rule that federal student loans enjoy. Therefore, private student loans are subject either to a) the state rules of the borrower, b) the state of the lender, or c) some other state's rules as specified in the loan contract. Look to the original loan document for which state's rules apply to the contract.
    0 Votes

  • 35x35
    Jun, 2010
    GENE
    What if its not a federal loan and it's more than ten years old. Do the same rules apply as far as no statute of limitations?
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    Contact the creditor and explain the situation, and negotiate a lump-sum settlement of the debt. My guess is that the present creditor bought the debt for less than the face value, and the present creditor may be interested in deal where it can get the collection account off its books. See the Bills.com resource Debt Negotiation and Settlement Advice and Negotiating Debt to learn more.
    0 Votes

  • 35x35
    Mar, 2010
    Marilyn
    Dear Bill: Thanks for all of your obviously good work. I am trying to find a way out of a student loan that I have nothing to do with. It was taken for $5,000 back in 1987 by my husband, William. Bill said the school had a placement system and was told that they could find him a job after graduation but that never materialized and after completing his course at Southern College (around 18 mos. in Orlando, FL) he got a certificate but could not land a job in the field EVER. For years we paid in to the loan and then hit a major family crisis and had to stop paying on it. When they finally started demanding money, we arranged for them to take around $2,064 yearly (out of each paycheck) for around five years. That is a total of $10,920 we have paid into this loan that is now held by Direct Loans. (This was not the original original company). Since we relocated to Spokane 3 years ago, Bill, now 55, has not had even a hint of a steady job and we have been on unemployment on and off. Now he receives a small stipend weekly from WA State and is working for minimum wage 20 hrs. weekly. He is desperately trying to get funding for some retraining and is working with WIA and AARP to get into a training program. We are basically living on my Social Security and FL Retirement. I was diagnosed with diabetes in Jan. 2009; I am a rheumatoid arthritic and keep this condition in partial remission with the use of expensive natural supplements, which are very expensive for me. Right now I think I have around $80 in three bank accounts. My point is, since we have more than repaid this original loan of only $5,000 and they are constantly billing us for more; they say we owe over $6,500 and we don't think this is fair. They have had their original $5K PLUS over $5K in interest. When does this stop? We can't pay it at all. I am going on 76 years old and Bill turned 55 last December, 2009! This loan is over 20 years old and still climbing. I want forgiveness for this money, since they have been more than amply paid. Can you help or steer me in the right direction? Do I have to write directly to Obama and plead for relief of this loan? If I have to, I will. I cannot see giving Direct Loans more money in pure interest when we are in such dire hardship.
    0 Votes

  • 35x35
    Mar, 2010
    Mel
    Bill when i said "so that is not the case with federal debt?" that was my statement that i just learned something from u. I am an ex-collector, so I am researching stuff right now for a friend on his student loan.
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    Mel, if you can cite a case where a student loan debtor has made a court agree that a federal student loan needs to be validated, I will share that information with Bills.com readers gladly. It would be great news that the Dept. of Education needs to play by the same rules private debt collectors must follow. However, it is my understanding that the Dept. of Education does not need to validate the debt for a federal student loan. I would love to be proven wrong, and I mean that sincerely.
    0 Votes

    • 35x35
      Jan, 2011
      lane
      Bill, A friend of mine has just been contacted by a collection company regarding a Federal Perkins loan. He graduated 23 years ago and truly believes that he paid all his student loans about 15 years ago. The company sent him a student loan consolidation application for him to complete but provided no quote as to the alleged amount due. Can he require the co to provide him with documentation to support the claim and verify the company itself is bona fide?
      0 Votes

    • 35x35
      Jan, 2011
      Bill
      I suggest that your friend send a written request for validation of the debt, sending it by certified mail, with a return receipt requested. The creditor must then provide your friend with documentation that shows the original creditor, the amount owed, proof the debt collector owns the debt or has been hired by the original creditor to collect it. You can find a sample debt validation letter at the Bills.com debt self-help center.
      0 Votes

    • 35x35
      May, 2012
      Dario
      I have a federal school debt which is 40 years old. The Department of the Treasury began taking $98.00 from my Social Security check every month. My total income was $848.00 plus a veteran's pension of $174.00 per month. I was under the impression that the Treasury, as well as the IRS, were only allowed to take 15% for any amount beyond $750.00 per month, which in this case should have been 15% of $98.00, or $14.70, but, in effect, they are taking 100% beyond the 750.00. Also, I never received any notification as to how much I owe, what my rights are, etc. etc. Nada, they just began taking the money out. Do I have any recourse? I can't hire an attorney with my limited income. Any suggestion will be greatly appreciated! Thanks for all your help to soooo many people.
      0 Votes

    • 35x35
      May, 2012
      Bill
      The Dept. of Education may not garnish more than 15% of your Social Security benefit or cause a garnishment that brings your payment to less than $750 per month. It appears the Dept. of Education is following the second rule (no check less than $750) but not the first (not more than 15%). Consult with the Dept. of Education's Federal Student Aid Ombudsman Group to learn if the published garnishment rules are accurate, or if the Dept of Education is off-setting more than it should in your case.

      One thought to consider before you contact the ombudsman's office. Your VA pension or retirement is not exempt from offset for a federal debt you may owe. The combined amount of your government benefits is $848 + $174 = $1,022 per month. 15% of $1,022 is $153.30 per month. Your bringing attention to your case may result in even more being off-set from your two benefit checks.
      0 Votes

  • 35x35
    Mar, 2010
    mel
    so that is not the case w/federal debt? even though they have no legal contract they can still collect?
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    For non-student debt, Mel, you are absolutely correct. Regarding federal student debt, I would like to see the source for your information.
    2 Votes

  • 35x35
    Mar, 2010
    mel
    my understanding is that if they can't come up with original documentation. you don't owe the debt. i would hire an attorney.
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    You do not have many options. See the link to the Dept. of Education Web site listed above to see the collections FAQ.
    0 Votes

    • 35x35
      Dec, 2010
      Rau
      For a Student Loan from 1976, what was the statute-of-limitations before the LAW changed in 1998? Would the law change actually be retroactive to 1976? -Rau
      5 Votes

  • 35x35
    Mar, 2010
    Bill
    I took out a federal student loan in 1979 and it was not paid off. I actually thought this was written off with the help of the school in 1981. In the past, I received calls from collection agencies but they could never produce paperwork and at one point told me the loan was from 1994 which in no way was correct, They stop calling after that and I thought it was finally resolved until I filed my taxes this year and was told there is a hold on the return. This happen 31 years ago. What can I do?
    1 Votes