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Do Student Loans have SOL


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I took a student loan back in 1992 from a school in NJ that failed to deliver the quality of education that I was expecting.

I was enrolled only 3 months, but when I first registered they did all the paper work for a student loan. When I dropped out I was told that the money that they had received ( I never saw one cent ) was going to be returned on my behalf to the lender, Chase.

In 1994 I relocated to FL and never thought about this again till 2001 when I enrolled in a University and found out that I didn't qualify for Federal student aid because I had a defaulted loan.

The NJ Higher Education authority had satisfied the loan with the lender, and the matters were in the hands of a NJ Law firm that was assigned to collect this debt.

I contacted this law firm and was advised that back in 1994 they had won a judgement against me in a NJ Court. I got this judgement later deleted from my credit report because it had been 7 years already.

In 2001 I made arrangements with this law firm to re-pay $100 a month and I did so for 6 months, then I stopped because I lost my job after 9/11.

Later I found out from my last employer that in early 2002 they attempted a salary garnishement but I was no longer there.

Now I receive a letter from this law firm saying the following:

We are in the process of preparing court documents to serve upon you, including but not limited to Orders for supplement Proceeding regarding your student loan. Your balance at this time is $3, 199.90 including interest.

I have sent today a DV letter CMRRR, this is my question: Is there a SOL on student loans? can they go back to the court case that they filed against me in 1994 and for wich they obtained a judgement and reopen that case? Did I voluntarily reaged the account when I made the 6 monthly payments in 2001? What is the best course to take on a situation like this?

Any HELP will be greatly appreciated?

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Is there a SOL on student loans?

There is no SOL on government guaranteed student loans.

Can they go back to the court case that they filed against me in 1994 and for wich they obtained a judgement and reopen that case?

Yes, the SOL for judgements in NJ is 14 years.

Did I voluntarily reage the account when I made the 6 monthly payments in 2001?

No, you did not re-age the the loan unless you brought it current.

What is the best course to take on a situation like this?

Investigate the law firm's claim about a judgement. If there is no judgement on record, contact the New Jersey Higher Education Student Assistance Authority (HESAA) and request rehabilitation for the loan. If there is a judgement, you will not be able to have the loan rehabilitated. (Most collection agencies don't bother with a judgement on a guaranteed student loan being as the law allows them to garnish (10%) without one.)

http://www.hesaa.org/intro.asp

http://www.nchelp.org/

http://www.nchelp.org/elibraryII/Main/05-ComManual/default.htm

Unified Student Loan Policy - Common Manual - Section 12.7

"A borrower may rehabilitate a defaulted loan by making

satisfactory repayment arrangements with the guarantor or

a collection agency acting on its behalf. A borrower who

receives loan funds for which he or she is ineligible due

solely to his or her error may not rehabilitate the ineligible

funds or otherwise have his or her Title IV eligibility

reinstated until the ineligible funds are repaid in full. A

borrower with a defaulted loan on which a judgment has

been obtained may not include that loan in a rehabilitation

agreement."

"Upon purchase of a loan by an eligible lender, the guarantor

will report to national credit bureaus that the default status

is to be removed from the borrower’s credit history, and the

loan will be considered rehabilitated.

[§682.405(a); §682.405(B)(2)]"

Note: The defaulted loan and judgement can only be reported on your credit report for 7 years.

Disclaimer: I am posting this at 3 AM in the morning and am quite sleepy, so please forgive me if I got anything wrong. Please verify all information I provided as this is not professional legal advice.

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