Imagine Having Your Student Loan Debt Wiped Out Because Paperwork Is Missing

Imagine Having Your Student Loan Debt Wiped Out Because Paperwork Is Missing

No matter how much money you’re making, it might feel like you can’t get ahead. There are a couple of reasons behind this, but the largest reason that plagues our entire generation? Student loans. Of course, if you’re in a public sector job that qualifies for loan forgiveness, you may not be too worried.

Sure, you won’t be making nearly as much money as your private sector counterparts, but you’ll be the one who’s laughing when your loans are forgiven after year 10 and you’re living the high life at approximately 75% of market rate for your current position. For the rest of us who weren’t lucky enough to hold down a government job for a straight decade, paying off our student loans can feel like you’re literally drowning. Unless you stumble into a six-figure career, it can be hard to keep a positive outlook on your finances when you basically mortgaged a house to own a piece of paper that’s propped up in your sad little cubicle.

Unsurprisingly, Americans are having a hard time paying down a collective $108 billion in student loans (hello, next mortgage crisis), so defaulting on these loans is fairly common. Normally this would be a bad thing – you can go into collections, your interest rates can go up, and your credit score takes a huge hit. This time though, that might actually be a good thing. For those who have defaulted on their private student loans, namely through the National Collegiate Student Loan Trust, and been taken to court by creditors, there’s a chance that their collective $5 billion in debt is going to be forgiven – all because of an administrative error. That’s right – the paperwork confirming who actually owns the loans has gone missing, and without this proof, many people are becoming debt free.

According to the New York Times, many of these collections lawsuits are being dismissed due to the lack of paperwork, so this is really, truly happening. In one lawsuit, a random sampling of 400 loans from National Collegiate showed that this paperwork was missing in each and every loan, meaning that if taken to court over missed payments, there’s a good chance your loans would be uncollectible.

Now, I don’t necessarily want to tell you to stop paying your student loans, but if your loans are through National Collegiate, you may want to start doing some research. If you’ve already defaulted and have been contacted by a creditor, lawyer up. For those of us who owe the federal government or Sallie Mae, we’re currently out of luck and still held accountable for all the debt that went into a Women’s Studies major. However, if anyone out there from Nelnet is reading this and wants to start deleting some computer files to help out the rest of us, I know of an entire generation that would thank you. In the meantime, I guess I’ll keep paying my loans, but you’d better believe that I’ve started praying for a merciful soul to start filling their recycle bin as soon as possible.

[via New York Times]

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Steph W.

Steph W. is a new Master's degree graduate with an intern's salary and six-figure taste. She realizes her expectations far exceed reality, so she spends her days pinning away Loubs she pretends are in her physical closet instead of her virtual one. Her hobbies include attempting to trapping her boyfriend into marriage before he finds out how insane she is and pretending that Black Box wine tastes as good as the kind she could afford when she was gainfully employed. Send her tips for getting out of student debt at

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