What Can a Cosigner Do if a Student Loan Borrower Defaults
My question involves collection proceedings in the State of: Texas
Regrettably I am amongst the masses of people that tried to further another person's education by helping them out as a co-signer. Now this loan in particular I do not recollect signing any documents for nor do I have any copies of the loan origination documents. I did however co-sign for a separate loan through Sallie Mae with the same person as listed in the AES loan. I have all documentation of the Sallie Mae loan but I do not for the AES loan. I am normally very good at filing and retaining all legal documents that requires my signature in a safe location.
On September 2nd, 2011, I submitted the required forms for the "standard right-to-know" request. This was done to get copies of the loan origination documents to see if it is truly my signature or not. I have not received any information from AES regarding the documentation on this loan to this date. I have also requested numerous times on the phone with representatives and all I have received with a letter stating that I requested for information but did not receive the actual documentation that I have been requesting. I have also contacted their legal department and have yet to receive a reply.
Despite that this loan could very well be fraudulent, to keep my credit rating from taking any hits I have continued to try to keep on the borrower to keep this paid on time. The borrower on this loan has been on and off with keeping payments on time and I have made payments on this loan to keep it from damaging my credit. I have become fed up with having to cover for the borrower and am refusing to pay the loan until I receive proper documentation that I am indeed the co-signer. Currently I cannot get ahold of the borrower anymore(disconnected phone and moved without notifying me the address, both of which are breeches of a contract that I had a lawyer create for Sallie Mae loan) the loan is now 90 days overdue and am lost on what my options are as far as dealing with AES and this loan. What are my options with dealing with this loan and AES? And how do I pursue that? Currently I am Iraq and will be here until the end of the year. Thank you!
Re: What Can a Cosigner Do if a Student Loan Borrower Defaults
You are doing a sensible thing in trying to get documentation that you in fact cosigned for the loan, but unless and until AES is convinced that your signature on the loan is a forgery they're going to keep coming after you for the money. It does not sound like your (former?) friend is going to indemnify you, and it may be that he lacks he money to do so, but you can sue him to try to recover the money you've paid toward his debt. Realistically speaking, that would have to wait until you return to the U.S.
If by "I am in Iraq" you mean that you're active duty military, you have potential remedies under the Servicemembers Civil Relief Act (SCRA) that you may be able employ in relation to the lender; but if you're a civilian that law does not apply to you.
Re: What Can a Cosigner Do if a Student Loan Borrower Defaults
Ok thank you and yes that is actually the route I took with the Sallie Mae loan. I ended up paying up to about $900 to keep the loan up to date and attorney fees and filed a civil lawsuit for unjust enrichment while I was home on vacation. I was able to convince the borrower to sign an agreement to pay me back all fees and monies I put forward up to that date as well as for the amount of the remaining balance so I would get reimbursed via direct deposit for paying off the Sallie Mae loan. I appreciate your reply and yes I am a civilian now.
Re: What Can a Cosigner Do if a Student Loan Borrower Defaults
Many standard student loans are now obtained online. How are you related to the person?
Re: What Can a Cosigner Do if a Student Loan Borrower Defaults
Quote:
Quoting
thorpe22
My question involves collection proceedings in the State of: Texas
Regrettably I am amongst the masses of people that tried to further another person's education by helping them out as a co-signer. Now this loan in particular I do not recollect signing any documents for nor do I have any copies of the loan origination documents. I did however co-sign for a separate loan through Sallie Mae with the same person as listed in the AES loan. I have all documentation of the Sallie Mae loan but I do not for the AES loan. I am normally very good at filing and retaining all legal documents that requires my signature in a safe location.
On September 2nd, 2011, I submitted the required forms for the "standard right-to-know" request. This was done to get copies of the loan origination documents to see if it is truly my signature or not. I have not received any information from AES regarding the documentation on this loan to this date. I have also requested numerous times on the phone with representatives and all I have received with a letter stating that I requested for information but did not receive the actual documentation that I have been requesting. I have also contacted their legal department and have yet to receive a reply.
Despite that this loan could very well be fraudulent, to keep my credit rating from taking any hits I have continued to try to keep on the borrower to keep this paid on time. The borrower on this loan has been on and off with keeping payments on time and I have made payments on this loan to keep it from damaging my credit. I have become fed up with having to cover for the borrower and am refusing to pay the loan until I receive proper documentation that I am indeed the co-signer. Currently I cannot get ahold of the borrower anymore(disconnected phone and moved without notifying me the address, both of which are breeches of a contract that I had a lawyer create for Sallie Mae loan) the loan is now 90 days overdue and am lost on what my options are as far as dealing with AES and this loan. What are my options with dealing with this loan and AES? And how do I pursue that? Currently I am Iraq and will be here until the end of the year. Thank you!
If you have made payments on this loan, then the loan is not fraudulent. Your paying on the note means acceptance. I suggest you keep making those payments if you want to maintain a good credit history.