Steps to Take If You Are Sued by National Collegiate Student Loan Trusts

Steps to Take If You Are Sued by National Collegiate Student Loan Trusts

by | Apr 2, 2019 | Consumer Debt Defense

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Fighting Back in Your National Collegiate Trust Lawsuit

Records show that students across the country may be sued for debt they no longer owed, by companies they never even borrowed from or by creditors that lacked the legal standing to sue in the first place. Put simply, the debt collectors who represent the NCSLT often cannot even prove that borrowers actually owed them any money, even though they are taking innocent people to court!

If you are one of these targeted individuals that has been sued by the National Collegiate Student Loans Trusts, follow the steps below!

Due to mounting tuition costs, more and more individuals are turning to student loans, ultimately resulting in piled up debts! This has long been a topic of conversation, yet the problem persists or grows worse.

On one hand, Missouri fares better than most, ranking #32 for average student debt in the United States, but still hitting pretty close to the middle of the road. Meanwhile, a considerable 58 percent of students in Missouri graduated from school in 2017 owing money which they are still paying to this day.

On a national scale, about 15 percent of the Class of 2017’s debt was for non-federal loans, which are more expensive, have fewer repayment options, and fewer consumer protections than their federal student loan counterparts. This has lead to rising levels of defaults which, in turn, offers a lucrative business opportunity for companies to cash in on lawsuit settlements, wage garnishments, and other compelled payments at the expense of unsuspecting young adults.

Who is the National Collegiate Student Loan Trusts?

One company that is taking advantage of the student loan situation is the National Collegiate Student Loan Trusts (NCSLT). The NCSLT is a large entity that is not officially a lender, but they purchase private student loans from lenders such as Chase, Bank of America, Wells Fargo, Discover, Charter One Banks, Bank One, Union Federal Savings, and others.

In recent years, the NCSLT and one of the debt collection companies that represent them, Transworld Systems, have been in some hot water over lawsuits filed under unscrupulous conditions.

As Transworld Systems churned out lawsuit after lawsuit, the mass-produced documentation they produced was based on questionable verification. For instance, the software they used would automatically fill in details like the amount owed and more. Once finished, they were signed by uninformed employees “for fear of losing their jobs,” according to reports. Additionally, Transworld employees would inaccurately swear that borrowers’ loans had been purchased by investors on dates that were sometimes months or even years before the loans were ever made!

In 2017, the Consumer Financial Protection Bureau accused NCSLT and Transworld of using sloppy and illegal debt collection methods and asked a judge to order an independent audit of all 800,000 loans currently held.

Under the settlement terms, NCSLT (and their representative companies like Transworld) are forbidden from bringing any new cases or collecting on the judgments of old cases they won—at least until they had completed an audit of the paperwork underpinning every single one of the 800,000 loans. However, there is a dispute over this settlement that could take months, if not years, to resolve. This means that the NCSLT is able to continue bringing new lawsuits against borrowers.

Step 1. Don’t delay

The worst thing you can do is ignore the situation. If you think it might all blow over, think again. If the case sails through the courts unchallenged, it could result in what is called a default judgment in favor of the debt collection company. Default judgments can lead to…

  • Wage Garnishment – Your bank account might be frozen and emptied to cover the debt
  • Judgment Lien – A judgment can often cloud the title on your property
  • Property Sold – Certain property can be sold at auction to pay towards the judgment
  • Credit Report Damage – Judgment can be published on your credit report which is under public record

Don’t ignore the situation! In the very least you can start the process immediately by documenting your interactions with representatives, keeping track of phone numbers, who you speak with, what they say, etc.

Step 2. Consider all debt collection defenses

With the faulty and oftentimes shady ways in which documentation is maintained by the debt collection companies, there are legal defenses that may apply in your case.

These include (but are not limited to) cases in which the National Collegiate Student Loans Trusts…

  • Cannot produce records stating that you actually owe the debt
  • Cannot produce proper evidence of the sale of the debt stating that they have the right to collect on it
  • Filed false and misleading affidavits
  • Sued you outside the statute of limitations (5 or 10 years in Missouri, dependent on the way in which the loan was originally provided)
  • Does not have standing to bring the claim against you
  • Filed a lawsuit even though the debt has already been paid off
  • Is not licensed to do business in your state
  • Failed to respond to requests for more information in a timely fashion

Step 3. Call an attorney to help get your National Collegiate Trust lawsuit dismissed

The NCSLT counts on people being unaware of their unfair debt collection practices as well as them not having access to legal representation. If you receive a lawsuit from National Collegiate Student Loan Trusts or one of their connected companies, like Transworld Systems, call a lawyer as soon as possible. It is your best hope at erasing alleged debt and keeping your credit free and clear!

Contact consumer debt defense lawyers with experience, like those at Rogers Sevastianos & Bante, LLP. We can defend your rights when facing down the debt collection company’s army of attorneys.

The NCSLT likely has no legal basis for the claim. Therefore, we are adept at investigating the issues key to your case, finding mistakes in the company’s collection methods, and constructing a strategic defense based on all the factors before us.

Your defense is only as good as the attorney who stands next to you in court. Let us put our more than 100 years of combined experience to work for you in your National Collegiate Trust lawsuit. Contact us now if you think you have a case.