In today’s article we are discussing a student loan lawsuit brought in New Jersey in which we defended the client and ultimately settled for a substantial reduction.
As is often the case, the borrower had fallen on hard times and consequently defaulted on a private student loan. The debt was assigned by Citibank to United Guaranty Commercial Insurance Company (hereinafter “United Guaranty”), which retained the law firm of Schachter Portnoy LLC in Princeton, New Jersey. In turn, they brought a lawsuit against the borrower for approximately $24,000.
In our answer to the lawsuit, we asserted a broad range of defenses, including:
- Questioning the accuracy of the balance
- Alleging that the assignment to United Guaranty was incomplete or otherwise not bona-fide
- Contesting United Guaranty’s standing to bring the lawsuit
We followed up with comprehensive discovery demands, including a request for admissions, interrogatories, and a demand for production of documents. The purpose of making these demands is to identify evidence which will shed light as to the legitimacy of the claim, or lack thereof.
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Given this client’s preference to resolve the matter expeditiously, the borrower instructed our firm to explore settlement negotiations. Some of the major benefits of settling a lawsuit is to avoid the costs and risks associated with protracted litigation, including the risk of having a judgment entered for the full balance. The borrower was on a limited budget, so we needed to work towards achieving an arrangement that she could afford on a monthly basis, while simultaneously working towards reducing the student loan debt as much as possible.
Ultimately, the parties stipulated to settle the lawsuit for a total of $8,000, to be paid with an initial down payment, and affordable monthly payments thereafter for a period of several years. This arrangement allows the borrower to save over $16,000 on her student loan balance with United Guaranty and avoid further litigation. By taking advantage of this settlement, the borrower stands to reduce the balance by 67%.
If you are overwhelmed by a lawsuit for student loan debt, call our law firm to learn your options for relief. Our debt lawyers assist with defending lawsuits in New York and New Jersey brought by collection firms such as Schachter Portnoy on behalf of Plaintiff’s such as United Guaranty Commercial Insurance Company.
Contact our lawyers at (888) 301-0584 to schedule your free case review and learn how we can help.
Prior results do not guarantee similar performance. Results vary. This illustration is intended to highlight an achievement of the law firm, and should not be relied on to be typical. While we strive to maintain accuracy and provide relevant case histories, in order to protect the confidentiality of our client(s), all numbers are approximations and are offered for illustrative purposes only. We make no claim or allegation of wrongdoing by the entities discussed on this page. United Guaranty Commercial Insurance is sometimes mispelled as "United Guarantee". Call us for an evaluation of your situation.