National Collegiate Student Loans May be Wiped Out

Recently the New York Times ran an article on the possibility of private student loans that are held by the National Collegiate Student Loan Trusts being wiped out due to poor documentation. While the New York Times article is shining a light on this the problems with National Collegiate Student Loan Trust collection lawsuits is nothing new.

Here at the Arizona Consumer Law Group we regularly represent student loan borrowers who are being sued by National Collegiate and routinely see problems with their documents, missing information, and witnesses not showing up to trial.

Recently I had a National Collegiate case where the judge set a hearing on a Motion for Summary Judgment that had been filed by National Collegiate. I had filed a proper response to the motion, however I didn’t have to say a word at the court hearing. The judge spent the entirety of the hearing picking apart National Collegiate’s case and telling its attorney in great detail about the the many problems with their case.

When National Collegiate Student Loan Trusts files a lawsuit it bears the burden of proof – it must prove that it is the actual owner of the account and what amount is owed. Surprisingly this is a difficult task for National Collegiate.

National Collegiate Student Loan Cases in Arizona

National Collegiate Student Loan Trust files many lawsuits in Arizona each month. They are often filed in the superior court that deals with lawsuits where the amount in dispute is over $10,000.

If you have been sued by National Collegiate Student Loan Trust your first thought is likely – who in the world are these guys?  And this is with good cause; you didn’t enter into a contract with National Collegiate and they didn’t loan you any money.

National Collegiate Student Loan Trust is the alleged owner of various private student loans taken out with banks like JPMorgan Chase Bank, Charter One Bank, and Bank of America.  Once these loans are taken out by one of the various banks, they then transfer the loans to a company called The National Collegiate Funding, LLC and then eventually transfer them to the National Collegiate Student Loan Trust.

After the accounts go into default National Collegiate Student Loan Trust will often file a lawsuit seeking the amount owed.  However, as in all cases were the original creditor is not the one filing the lawsuit, there are various problems with the lawsuit and what can actually be proven.

Regardless of the problems with their lawsuit, you will not win if you don’t take the vital first step of filing a written Answer with the court.

Don’t Ignore Your Lawsuit with National Collegiate Student Loan Trust

Too often people ignore the lawsuits filed by National Collegiate and other debt collectors.  In fact, studies show that nearly 95% of debt collection lawsuits end in a default judgment.  A default judgment occurs when people ignore the summons and complaint they received and think the matter will go away if they stick their head in the sand long enough.

Arizona courts impose strict deadlines for you to file a written response (called an Answer) to the lawsuit filed by National Collegiate Student Loan Trust. Once the process server drops off the summons and complaint, in Arizona you then have twenty (20) days to draft and file your written Answer with the court or you run the risk of having a default judgment entered against you.

Once a default judgment is entered you lose a lot of power and leverage to resolve your case with National Collegiate on favorable terms.

Don’t ignore your lawsuit. If you do there will be real consequences and you won’t like them.

The great thing about fighting National Collegiate head on is that you have great defenses to their lawsuit if you get involved early and assert your rights.

If you have been sued by National Collegiate Student Loan Trust give us a call (480-420-4028).  I offer a free consultation where we can go over your options and strategies to help eliminate this debt once and for all.