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Wednesday, July 19, 2017

No papers, no debt: Billions in student loans may be wiped out

Billions of dollars in student loan debt may be forgiven because documents proving ownership of the loans are missing.

Creditors taking borrowers to court over loans in default are instead seeing the debt wiped out because of incomplete ownership records and other documentation, The New York Times reports.

National Collegiate Student Loan Trusts -- an umbrella name for 15 trusts that own $12 billion in private student loans -- has brought more than 800 collection cases to litigation this year alone. But it has struggled to prove ownership in court, with the loans originally made by banks being sold to investors. Without proper documentation, the loans are deemed uncollectible and a situation not unlike the last decade's subprime mortgage crisis is created.

More than $5 billion of the debt held by National Collegiate remains in default.

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2 comments:

Anonymous said...

Obummer nationalized the student loan program. By nationalizing student loans, Obummer took the risk away from banks and placed it on the tax payers.
When the government runs things gross incompetence then enters the picture and walah! You the tax payer get sstuck with the bill for Obummers very bad decisions and the complete incompetence of government slug workers. (That get paid on average twice what private sector workers make doing the same kind of work)

Welcome to Trump and the people vs entrenched government dark state.

Anonymous said...

Then they need to find everyone that has had a student loan and reimburse them for what they already paid off. I borrowed and I paid off. F*** Them! They know what they owe.