When you take out loans to further your education, you are more than likely doing so as a way of bettering your future and increasing your training and skills for your future employment. However, with the rising costs of education and increased need for experience in the workplace, many borrowers are finding themselves thousands of dollars in debt that they don’t know how to pay back with what little money they are earning. Student loan debt has rapidly risen to the point where it is now the second largest source of debt in the country behind only mortgages and home loans.
If your student loan account becomes delinquent for too long, your lender may choose to take collection actions against you, which starts with filing a lawsuit. If you’ve been notified that your lender is pursuing a debt collection lawsuit, you may be confused, panicking, and wondering what to do next. Being in debt is stressful enough, let alone facing the prospect of a lawsuit when money is already so tight.
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Here are some tips for fighting back against a student loan lawsuit filed against you.
Consult With an Attorney
A debt defense lawyer can be an extremely valuable and powerful ally when facing a debt collection lawsuit in NJ. Experienced debt relief lawyers are familiar with the laws and processes that these suits must go through, and they are both a watchman and a defender against your creditors when they try to come after you and collect on the delinquent account.
Remember: your lender doesn’t necessarily care about what’s in your best interests—they just want their money back. An attorney does care about your best interests and will fight for you to obtain the best possible outcome as well as advise you on the options you have available that can help you get out of debt faster.
Validate the Debt
The first thing an attorney will likely do when you’ve been notified about a lawsuit pending against you is validate the debt. To put it in simple terms, validating a debt means making sure the party who has served the notice against you actually owns the debt and has the right to pursue it. If there are discrepancies in the ownership or how the debt was transferred, they may not have grounds to make the claim at all.
Likewise, an attorney will also do a little bit of digging into records and figure out if the debt has been properly calculated. Improperly calculated debt with an error in the balance may lead to the debt being reduced or even discharged in some rare circumstances. Likewise, if an action is taken against you and you’re either current on your payments or you don’t actually owe the debt, then you can’t have action taken against you. When this happens, your attorney will probably simply file a motion to have the case dismissed and present the evidence to show why.
Common Defenses
If the debt is valid and you are outstanding in your balance, then you and your attorney will need to figure out a defense. There are several common defenses, and one just might be right for you. Here are a few quick examples.
You never agreed to pay the debt.
If you’ve been a victim of identity theft or someone has taken out
student loans in your name only to disappear, then you aren’t liable
for the debt itself. You’ll need proof that it wasn’t you
who took the debt out (which can be difficult to come by), but report
the identity theft to the police and keep a copy of the report on your
records. An attorney can help you with utilizing this defense.
The creditor waited too long to sue you.
New Jersey law places a statute of limitations of six years for collection
actions and lawsuits on all types of loans. If the debt is overdue by
more than six years, then your collector can no longer take action to
collect the debt. There are a few things that can influence when this
six-year clock starts, but generally speaking it begins on the day the
account becomes delinquent for the first time, in other words, the first
date that your account first became past-due.
Your loan was cancelled.
This is an extremely rare circumstance, but you may be able to get your
loan cancelled if you are unable to complete your educational program
due to school closure. If you decide to attend a university and that university
then closes while you’re in the middle of your program, preventing
you from completing it, then you actually can have your loan cancelled
if it’s a FFEL, Direct Stafford, Plus, or Perkins loan. If you have
a private loan or other type of public student loan, you may still be
required to pay back the balance.
Get help from an experienced student loan lawyer nj with the Law Office of Simon Goldenberg, PLLC at (888) 301-0584!