We have been receiving many calls and emails regarding the recent New York
Times article discussing private student loans and lenders like National
Collegiate Student Loan Trust. National Collegiate Trust is one of the
biggest private student loan lenders in the country along with other such
as Navient, Discover, AES and Wells Fargo. The article brought great attention
to the fact that there are thousands of lawsuits filed against consumers
by these lenders. The more frightening fact is that there are thousands
of default judgments obtained against consumers whom either do not defend
themselves because they do not know how to or because they were never
served with the lawsuit which is a common problem in New York. A default
judgment then leads to these lenders levying consumers bank accounts,
garnishing their wages, and even placing liens on their real property.
In New York 9% judgment interest also attaches to a judgment of this kind
and because student loans are frequently large amounts, the additional
9% can add a substantial amount of debt.
Submitting an answer with defenses against private student loan lenders
like National Collegiate and Navient is the first and most important step
because it protects the consumer against a default judgment. Discovery
is the next and most critical phase as it is where you find out whether
National Collegiate has the documentation or proof necessary to meet their
burden in court or whether they can prove their case against a consumer
in other words. If they do not have the promissory notes and statements
along with essential other forms then dismissal can be sought. There is
another critical step however which is requesting depositions so that
the agent who has "personal knowledge of the transactions,"
can be deposed to see if they are able to lay the foundation to have the
documents they are trying to introduce admitted into evidence. This is
crucial because the lenders will usually have some documents or even most
of the documents and state that they have all the proof necessary to prove
their case. However, if the agent from National Collegiate or Navient
does not have personal knowledge of these transactions then the evidence
cannot be admitted under the hearsay doctrine. This is how these cases
can be won.
In a worst-case scenario this type of defense will give the consumer enough
leverage to obtain a fairly low settlement with fair repayment terms as
the lenders would rather not spend the time and money going to depositions
and litigating these matters.
As Paperwork Goes Missing, Private Student Loan Debts May Be Wiped Away