Statute of Limitations for Federal & Private Student Loans

What is the statute of limitations for student loans?

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Bill's Answer: Answered by Daniel Cohen

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.

Good Idea 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.

Quick Tip: Struggling with debt questions? Let the 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.

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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.

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Comments (76)

Paul A.
Fontana, CA  |  April 07, 2014
I never made a payment on my private student loans. Will statute of limitation still apply from the date the loans defaulted? Also, if I spoke to them over the phone, does that restart the statute of limitations?
April 08, 2014
Regarding your first question, private student loans are subject to state statutes of limitation. Review the article above for a more thorough explanation of private student loans and state statutes of limitation.

You can reset a statute of limitations in two ways:
  • Making a voluntary payment to the lender
  • Making a written promise to pay the loan.

Note that a written promise to pay rule is the standard most states follow. Generally, if you have a conversation with a lender about payment options, the balances due, and your financial situation, that does not rise to the standard of making a promise to pay.

Pat H.
San Diego, CA  |  April 03, 2014
I had a $10k Federal Student loan upon graduation in Michigan back in 2008. In 2009 while at boot camp, the loan went into collections. I have never made a payment nor have I ever replied to any collectors. What is my SOL on the situation?
April 03, 2014
Federal student loans are not subject to state statutes of limitations.
Lloyd C.
Wyandotmie, MI  |  March 28, 2014
I have an interesting situation here. I took out a private student loan through Sallie Mae in 2001 with my Father as the co-signer. Since then, we both have gone through tough times and were never really in a situation to pay on it. However, over the years he had made a few small payments here and there which have kept the account current, therefore restarting the statute of limitations. My question is this: Since I have never acknowledged the debt, nor made a single payment, will I be able to apply the statute of limitations to get this removed from my credit report? Or will his activity on the account prevent that from happening? **I know this sounds like Im trying to screw my Dad over and stick him with the debt, but I warned him over the years about the SOL and he proceeded to mess that up with a few $20 payments here and there. He also says he really doesnt care about his credit now that he's retired....
March 28, 2014
You father didn't do either of you any favors by making the periodic payments. Because this is a joint debt with, I assume, both of you jointly and severally liable, a voluntary payment by either of you resets the statute of limitations clock back to zero. However, that's the general rule, and the best source of information on this particular detail is best answered by a lawyer in your state who has consumer law experience.

Have a heart-to-heart with your father explaining you two need to work in a coordinated manner for you to resolve this debt. His free-lancing may not have any immediate impact on him or his credit score, but it's harming you.
Eric M.
Casselberry, FL  |  March 05, 2014
Hello, I didn't get my degree when I borrowed SL, only borrowed $7,500 back in 1995. Well, I ended up losing everything and moving out to the country homeless working on a ranch for room and board. Ever since I moved back to Florida in 2002, every job I get or anywhere I go, me and my employers get intensely harassed by SL Creditors. I send Cease and Desist letters because I couldn't pay anything making $10 per hour while being a Type 1 diabetic now. Thus, with the new Healthcare rules, my healthcare cost has increased another 50%. Thus, I am barely staying afloat with a roof over my head now making $30k a year. But, they are threatening to garnish my wages. Anyways, I have not had credit since Oct. 1998 when I filed bankruptcy because I cannot buy a house, car or even get a simple credit card due to my Past Due student Loans. My life is eternally screwed with nothing I can do to stop them from ruining my life. Thus, I gave up long ago and just live day by day. Because, my diabetes is harsh and I don't have the energy to work two jobs. Is there any options for someone like me or should I just continue to give up on having a decent life.
March 10, 2014
Talk with a Florida lawyer about filing another bankruptcy. I know everyone says "student loans cannot be discharged in bankruptcy" but that's not true in all cases. If you cannot afford a lawyer, contact Florida Legal Services or another Florida pro bono program to find a bankruptcy lawyer.
Dan C.
Beverly Hills, CA  |  February 17, 2014
I took out a private loan in 2005 and just graduated from grad school. I have never made a payment and was wondering if my statute of limitations is already up on this being that in California it is 4 years. The only part that confuses me is that it says that the stats are up 4 years after the breach of a written contract (at what point is this contract considered breached?)....Can you help me with this?
February 18, 2014
Hypothetical set of facts to help answer your question: Mary borrows $100 from Sally in January with the promise to repay the loan the following December 1. The statute of limitations clock for Mary starts (in most states) on December 2, not back in January.

Back to your facts. If you signed a loan contract in 2005 that says you will start your payments 30 days after you graduate, the statute of limitations clock starts 31 days after you graduate. It does not start in 2005.
Chalfont, PA  |  June 19, 2013
I am currently being sued for a private student loan in PA. The plaintiffs claim I made a payment in August, 2009. In August 2009, the payments I was making were on federal loans. I graduated in 2006, and I do not think I have ever made a payment on the private CitiAssist loan for which I am now being sued. In my answers to the complaint (September, 2012) I included a Request for Documents which was time stamped by the Prothonotary. Earlier that summer, I spoke to the attorney who asked me to email him my requests for information. I asked him to show me receipts of my payments and proof of the original loan. He never responded. Nor did he respond to my request for documents. I do not think they have any documentation that proves I owe the money. More, I believe the SOL has passed.

June 10, 2013, I received a omnibus praecipe saying the matter is ready for a three-hour arbitration. No date had been set as of June 19, 2013. I need to file a motion for discovery. But how do I word my argument so the case is dismissed via SOL? Any info you have would be tremendous.
June 19, 2013
I'm not a Pennsylvania lawyer, so I am incompetent to give you advice on Pennsylvania's civil procedure law. I appreciate your willingness to tackle this issue pro se, but the best advice you will receive will be advice you pay a Pennsylvania lawyer to give you. If you cannot afford a lawyer, contact your county's bar association and ask for the names of the organizations in your area that provide pro bono advice to people who have low or no income. Make an appointment with a lawyer at one of those organizations and ask for assistance in drafting a motion to dismiss.
Margaret C.
New York, NY  |  June 11, 2013
I have a federal student loan before the changes in 1998. I just recently had my federal tax refund given to the federal department of education. I am wondering since I am before 1998 will they have the ability to garnish wages?
June 11, 2013
I can't find a definitive answer to your very reasonable question. My guess is that you can suffer an administrative garnishment. I think it likely that the same authority that Congress used to limit BK as a remedy for loans that were previously eligible to be discharged in BK allows for an administrative garnishment for loans that were previously not collectible in that manner. I will do some further research and update this answer, if I can find solid information.
Elizabeth H.
Winder, GA  |  May 22, 2013
I had two student loans, one with Wells Fargo and one with US bank. I consolidated them back on 08 with ACS. Im wanting to know if those loans have a statue of limitations? Are they considered private loans? I am being harrased daily and tey are threatning everything under the
May 22, 2013
ACS made both federal and private loans, so use the student loan locator at the Dept. of Education Web site, to see if your loan is federal or private. If your loan is not listed in the database, then it is a private loan and subject to SOL on debt.
Cynthia M.
January 31, 2013
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?
January 31, 2013
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 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.
Rick B.
Dallas, TX  |  June 26, 2012
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.
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