What should I do if I get sued for student loan?

You’ll have to raise any applicable defense in a formal response to the lawsuit; otherwise, you’ll most likely lose the chance to get out of paying the debt. If you’re sued for nonpayment of a federal student loan, you might be able to raise one or more of the following defenses, among others.

Can a federal student loan lawsuit be dismissed?

Generally, only federal student loans—not private ones—may be discharged. If the lender or loan servicer has already approved your discharge request at the time of the lawsuit, provide supporting documentation in your response to the suit.

Can a creditor sue if you default on a student loan?

If you default on a student loan and the creditor files a lawsuit seeking payment, you might have a defense to the lawsuit. If one of the below defenses applies in your situation, you might not have to pay the student loan debt.

What’s the best defense for a student loan lawsuit?

(With a defense to repayment argument, for example, you argue that your federal student loans should be discharged due to school misconduct, like fraud.) If you haven’t applied for a discharge yet, you can ask the court to delay your case while you apply and the discharge is pending.

What happens if I get sued for my student loan?

Whether or not you get sued for your student loans will depend on whether your loans are federal or private. Since the government has several options to force you to repay, including wage garnishment or withholding tax refunds, it is uncommon for borrowers to see a lawsuit from missed federal loan payments.

Is there a defense to a student loan lawsuit?

In most legal actions, you can also raise a defense that a contract is not valid because you were under age when you signed it. This defense, however, is not available in government student loan collection actions. Some of the defenses you can raise are similar to the government loan discharges available outside of court.

Are there any lawsuits against Navient student loans?

Navient Corp., a major servicer of private and federal student loans, is facing six lawsuits alleging that it harmed student loan borrowers throughout the repayment process. The suits are still pending and could take years to conclude.

Can a student loan holder accept a settlement offer?

Federal student loan holders can accept settlement offers for less than these amounts, but it’s rare. Alternate settlement offers require additional approval, either from within the organization or the Department of Education itself, as they further affect the loan’s profitability.