Judge Dismisses National Collegiate Student Loan Trust Lawsuit

November 25, 2013

Leon County, Florida, Circuit Judge, John C. Cooper, dismissed a lawsuit filed by National Collegiate Student Loan Trust for breach of contract in connection with an allegedly defaulted student loan.    Judge Cooper ruled that the complaint was defective in that it failed to attach a copy of the contract sued upon.

 

In response to the order dismissing the complaint, National Collegiate Student Loan Trust filed an Amended Complaint, with several attachments, including what it contended was a copy of the assignment from the original lender.  However, the assignment offered by National Collegiate Student Loan Trust was to an entity named National Collegiate Funding, LLC and not the Plaintiff in the action.

National Collegiate Student Loan Trust v. Harvey, 2013-CA-2278.


Student Loan Lawsuits on the Rise

November 7, 2013

Student Loan lawsuits are on the rise. Two major student loan debt buyers, National Collegiate Student Loan Trust and SLM Private Credit Student Loan Trust, are suing consumers across the country for past-due private student loans. Neither National Collegiate Student Loan Trust nor SLM Private Credit Student Loan Trust are lenders but are debt buyers of private student loans guaranteed by TERI rather than by the federal government. These entities purchase student loans from the original lenders and attempt to collect them from the borrowers. The private student loans were used by students to assist in financing the cost of their education in attending undergraduate, law school, business school, medical school, dental school, and other graduate programs.

Both National Collegiate Student Loan Trust and SLM Private Credit Student Loan Trust are Student Loan Asset-Backed Security (or, as they’re known in the industry, SLABS). SLABS were invented by then-semi-public Sallie Mae in the early ’90s, and their trading grew as part of the larger asset-backed security wave that peaked in 2007. Simplly stated, these student loans are bundled and sold as investments to the general public as a safe investment.

In order for a suing creditor to obtain a judgment against the consumer/borrower on a defaulted student loan, the creditor must prove ownership of the loan. Given that the student loan consumer did not borrow the money from the SLAB, it must show how it acquired the loan. Proof of assignment of the student loan is a requirement.

National Collegiate Student Loan Trust and SLM Private Credit Student Loan Trust count on consumers doing nothing so they can obtain a default judgment against the borrower. From a statistical standpoint, more than 90% of all collection lawsuits – including those for private student loans – end up with a default judgment.
Most student loan borrowers who receive lawsuit papers simply do nothing to defend themselves. It is important for consumers to defend themselves against lawsuits brought by National Collegiate Student Loan Trust and SLM Private Credit Student Loan Trust to demand that they prove their case.

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Creditors Garnish Wages of Wrong Person

November 7, 2013

A lawsuit filed under the Fair Debt Collection Practices Act and the Florida Consumer Collection Practices Act alleges that Midland Funding, LLC and Pollack & Rosen, P.A. garnished the wages of the wrong person. A wage garnishment is an order from a court sent an employer requiring that money be withheld and forwarded to the creditor. However, in order for the wage garnishment to be lawful, there must be a valid judgment against the person whose wages are being garnished. In this case, the wrongful garnishment created havoc in the consumer’s checking account and many of his scheduled payments were dishonored as a result of the garnishment.

Both federal and state law make it unlawful for a debt collector to make a claim or legal right that does not exist.

Plaintiff is seeking statutory and compensatory damages against Midland Funding, LLC and Pollack & Rosen, P.A. and has demanded a trial by jury.

[The allegations in the Fair Debt Collection Practices Act lawsuit described in this article are the plaintiff’s version of the facts and must be proven with competent evidence. Moreover, these allegations may be denied or disproven by the defendants.]