SOL in NY for private student loans
Posted by FroyoAdvanced6786@reddit | studentloandefaulters | View on Reddit | 24 comments
I’m living in NY and trying to deal with private student loans. I talked to a few lawyers and got conflicting info on the SOL. While a couple told me that the SOL in NY is 6 years for private student loan debt, one lawyer told me it’s 3 years as the consumer debt laws changed a few years ago and this applies to private student loans, too.
I’d still need to figure out whether this law would apply to my loans (pre-2008 Sallie Mae Signature loans taken out in MA). But I’m wondering if anyone here has had success with running out the SOL in NY under this new law, or if you’ve had difficulty counting private student loans as consumer debt?
hello__brooklyn@reddit
3 years since Governor Hochul changed it. Before Hochul it was 6 years, but also had a borrowing statute so it could’ve been three years pre-Hochul depending on who you were running from.
MoneyWiseLawyer@reddit
3 years for consumer debt only. Student loans are explicitly exempted from consumer debt in other statutes.
hello__brooklyn@reddit
Private loans are not exempt. Just federal
MoneyWiseLawyer@reddit
Correct. Private student loans have a 6-year SOL in NY in spite of the change to 3 years for consumer debt.
Federal student loans do not have a SOL
morbie5@reddit
How did biden get your private loans discharged?
hello__brooklyn@reddit
I applied for Borrowers Defense also under the Biden Era program. For those who came in under the Biden Era, before Trump rolled his program terms back, you received an automatic discharge if the DOE did give you any decision on your application after 3 years, even if only a denial. DOE missed the deadline recently (currently in the news), and after two court appeals, the Supreme Court upheld the automatic discharges. I was discharged on both federal and private loans and received partial refunds. I didn’t get a refund for federal loans I’d already paid off. So I had three different avenues of forgiveness. SOL, legit Borrowers Defense, and unanswered Borrowers defense for a different school that I didn’t have an actual defense for, but had applied for to test the 3 year rule I read about when applying for the first school.
morbie5@reddit
Yea, some private lenders have their own Borrowers Defense
Why would the lender discharge instead of the school pay the loans themselves?
h20bender@reddit
It's not 3 yrs, will depend on the loan instrument and if its designated as a consumer or student loan, the consumer law change from NYS during covid does not automatically apply, do not give people the wrong info if u dont know, there is a lot at stake with these questions
hello__brooklyn@reddit
Are you saying that NY’s current SOL term that creditor’s have to file a lawsuit from the date of default for private debt from debt collectors is NOT three years?
FroyoAdvanced6786@reddit (OP)
For sure, mine are Sallie Mae Signature which were not tied to the cost of education, so I’m assuming this is why I got a 3 year response from one lawyer
FroyoAdvanced6786@reddit (OP)
Ahh ok, thanks for the info on this, and congrats! Yeah I’m in my 40s and my credit has already taken an enormous hit. It’s tough, but I’ve paid $50k on interest alone on these loans and the principal has barely budged, so I’m over it. I have a partner, guarantor, and an easier ability to move abroad than most, if necessary. I’m still considering my options, including settlement or bankruptcy.
morbie5@reddit
What do you mean?
FroyoAdvanced6786@reddit (OP)
Oh, just for apartment-renting purposes. Like a cosigner.
FroyoAdvanced6786@reddit (OP)
Did your statute of limitations clock start on the date of first missed payment or the date of default? That’s also something I’m confused about.
Aggravating_Storm493@reddit
You mentioned bankruptcy (I’ve written about my own experience on this sub a few times) and as a fellow resident of the same state, I would say if you :
AND
You have a good chance of discharging your private (and federal, too) loans. Your lawyer would need to file an adversarial proceeding after your bankruptcy is filed, and basically this filing is where you prove that your student loans are adversely impacting you to the point that you have a substandard living situation. If you can get documentation substantiating that you’re living a substandard life with health issues and or financial issues (like can’t hold a job due to bad mental health from loans etc), that goes a long way in getting the judge to approve your adversarial proceeding.
And even without an adversarial proceeding, it might be good to consult a bankruptcy lawyer who specializes in student loans in the event they have other options to get your loan lowered or gone from your life.
morbie5@reddit
When did you last make a payment?
FroyoAdvanced6786@reddit (OP)
5-6 months ago, so it’s early still. Just trying to weigh my options
h20bender@reddit
The option are this point is to save as much as u can while not paying in hopes of being able to settle down the road if/when they escalate and send a sumons. U can hope for an SOL defense if nothing happens but u should plan for a settlement, that is the mistake likely resolution
FroyoAdvanced6786@reddit (OP)
That makes a lot of sense. I’m a worst-case scenario kind of person anyway so I’m preparing to get sued.
h20bender@reddit
Unfortunately its not an automatic 3yr as u were told, with the new consumer law, it gets a bit more complicated, depending on when and where the loan was taken out. Have u already defaulted? If so u need to be very careful with what u communicate to the creditor.
FroyoAdvanced6786@reddit (OP)
I’m honestly not sure. I’m assuming I’ll get a notice when my loans officially go into default? I’m over 120 days past due and my credit has sunk, but no word yet. I’m not communicating with the creditor at this point.
SluggoX665@reddit
My private loans expired but it was alot longer than 7 years. I went off the grid for some time and low and behold...6 figure pvt loans gone and the federal ones are managable and also off my credit report. It paid to dissappear and not work like a slave.
FroyoAdvanced6786@reddit (OP)
I’m with you! I’m not sure how much I could live off the grid with my work, outside of getting a job abroad. But I’ve lived enough time as a slave to lenders and the credit system, even paying 50% of my income to MOHELA for interest-only payments during the last few months before I finally stopped paying. Even with my wrecked credit I’m feeling so much better just having money, and saving a lot of it for potential legal fees.
SluggoX665@reddit
Hang in there...! Enjoy your life and work for yourself. Your student loan would probably not even buy a ballastic missle.