National Collegiate Student Loan Trust is suing people in California, New York and elsewhere for past due private student loans. Who are they, and what should you do when confronted by this company?
Over the past year or so I’ve been a significant increase in the number of people calling me because they’ve gotten legal papers from National Collegiate Student Loan Trust.
These folks seem to have crept out of the shadows, and are filing lawsuits left and right.
In order to deal with the situation, here’s what you need to know.
National Collegiate Student Loan Trust Is Not A Lender
National Collegiate Student Loan Trust is a Delaware Trust that holds private student loans guaranteed by TERI rather than by the federal government.
All of the student loans in the trust were originated from several different banks under different loan programs that were structured with the assistance of The First Marblehead Corporation, which is an education loan finance company that also owns TERI.
National Collegiate Student Loan Trust Must Prove Ownership Of The Loan
Given the fact you didn’t borrow the money from that National Collegiate Student Loan Trust, they must have gotten the loan from another bank.
In order to sue on the balance due, they need to prove that they have the Promissory Note and are legally able to prove ownership.
In addition, they must prove that the amount claimed to be due is actually properly due.
A Lawsuit Against You Isn’t The Same As A Judgment
When someone files a lawsuit against you, all they’re doing is making a claim that you owe money.
It’s up to you to decide whether to do nothing or make them prove the case. If you do nothing, then a judgment will be entered against you.
But if you fight, you’ve got a chance of winning or settling the case on more favorable terms.
National Collegiate Student Loan Trust is counting on you doing nothing so that they can get a default judgment against you. After all, more than 90% of all collection lawsuits – including those for private student loans – end up with a default judgment. That means most people get lawsuit papers do simply do nothing.
Fight The Lawsuit To Get A Better Deal
If National Collegiate Student Loan Trust is suing you, there’s a good chance that it’s for a big dollar amount.
Sitting idly by will result in a default judgment being taken against you. Once that happens, you may be subject to wage garnishment, bank account freezes, or liens on your property.
Fighting the lawsuit, however, will force their attorneys to prove you owe them the money. They’ll have to account for the debt, as well as the fact that you are legally liable to them for payment.
It’s amazing at how often those simple facts can’t be proven. There may not be any documented proof that you owe the debt.
Other times, the debt is beyond the collection period.
Maybe you can get the lawsuit dropped. More often, you can get them to settle the case for either a lump-sum dollar figure or a reasonable monthly payment.
It’s worth having me take a look at the lawsuit to see if it makes sense to fight back.