teknolojiarsivi.com May 27, 2018

Thousands of student debts could disappear due to missing paperwork

20 July 2017, 12:51 | Vickie Mathis

Private Lenders Struggle to Prove Ownership of Student Loans in Court

As Paperwork Goes Missing, Private Student Loan Debts May Be Wiped Away

National Collegiate Student Loan Trusts is a trust of 15 companies who purchase private student loan debt.

At the center of the storm is one of the nation's largest owners of private student loans, the National Collegiate Student Loan Trusts. According to Fox Business, student loans account for $1.4 trillion in debt nationwide.

That's a big number, but it accounts for a relatively small fraction of overall US student debt.

At least $5 billion in private troubled student loans may be dismissed because paperwork that proves loan ownership is missing.

The loans in question here were taken out before 2007, and some other institution would have actually originated the loan.Documents filed with the SEC, for instance, show that the majority-but not all-of the loans owned by National Collegiate were originated by Bank One, Charter One Bank, Bank of America, JPMorgan Chase, GMAC Bank, RBS Citizens Bank, and Union Federal Savings Bank.

Are my loans owned by National Collegiate? . He is Donald Uderitz, the founder of Vantage Capital Group, a private equity firm in Delray Beach, Fla., that is the beneficial owner of National Collegiate's trusts. For the economists who have always been anxious about the US's impending student-loan crisis, it's even worse.

When borrowers don't go to court, National Collegiate nearly always automatically wins the case, but when they do show up, most of the time judges throw the suits out because National Collegiate was not able to produce the paperwork proving it owned the debt in question. An audit from 2015 showed that about 400 randomly-checked loans did not have the proper paperwork. Because of those steep rates, the size of the loans can quickly balloon, leaving borrowers to pay hundreds and, in some cases, thousands of dollars each month.

Am I paying my loans on time? .

If National Collegiate can't prove official documentation in court a judge will be forced to throw them out.

Has National Collegiate sued me for nonpayment?

The trusts win numerous lawsuits they file automatically, because borrowers often do not show up to fight. "It's a case-by-case battle".

Borrowers who can't afford an attorney can contact their local Legal Services office, Smith says.

This makes it unclear who exactly owns them.

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