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My Private Student Loan Debt Is Not Being Eliminated Because of My Disability

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Huffington Post Reader Question

I am a 62 yr. old male. I am disabled since approximately 1977. Have been on Disability from work and on SSDI forever. I have tried schooling twice, but my disability has kept me from getting and keeping work.

I am on limited, fixed income. Some work disability and SSDI.

Last schooling I had Fed. and Sallie Mae Private student loans. I was able to get the Fed. loans discharged by Total and Permanent Disability.

I digress. I had a bankruptcy.

Debt collector contacted me about Private loans. I sent them a letter within 30 days stating I wish contact only by mail and wish for Debt Validation. Their first letter to me was May 18 2014. I sent the request for Validation May 23 2014. The Debt Collector has not sent me the Validation yet.

How long do I need to wait for this Validation. Can you say what the course of things will be from here and what actions I might need to take. What are the things I can expect from the collector

I was understanding was the Private Student loans were taken care of through bankruptcy.

Wayne

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Dear Wayne,

When it comes to debt validation, take a look at this article and this one.

I'm glad to hear the federal student loan debt was discharged under the TPD (Total & Permanent Disability) program. The U.S. Department of Education has become much more reasonable about this.

Unfortunately private lenders are not required to go by the same set of rules. The general impression is there is little allowance for anyone to discharge any student loan because of a disability.

If your bankruptcy was not filed in 2005 or before then the private student loans would not have been just simply eliminated. That doesn't mean private student loans can't be, many still can even though people never try. Read this and this for examples of loans that have been.

I would imagine the collector might be having a tough time locating the documentation to validate your loan. This is especially true with the flood of private student loans granted over the last decade. It seems when lenders were sloppy with other loans like mortgages, they were sloppy with keeping track of supporting documentation for private student loans as well.

My advice is that rather than get ahead of yourself here, keep pushing for satisfactory answers in making sure your debt is valid.

But another issue to keep in mind is that private student loan debt outside the statute of limitations can still be discharged in a consumer bankruptcy.

Since I have no idea about the dates of the loans, the state you live in or much else I would advise you to talk to a bankruptcy attorney who is licensed in your state and get a legal opinion about if that private student loan debt could be 100% eliminated in bankruptcy now if it is outside the statute of limitations. It sounds old and could be a slam dunk with a new bankruptcy.

Steve

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