“I’ve been sued by National Collegiate Student Loan Trust — what do I do now?”

Your options when sued by a student loan company.

What do you do if sued by a student loan company? Discover your options now.

“I’ve been sued by National Collegiate Student Loan Trust — what do I do now?”

More more Alabama consumers are being sued by National Collegiate Student Loan Trust for private student loans.

The question is,”What do I do now that I’ve been sued?”

Please watch the video up above either before or after reading this article and the comments.

It is long (well over an hour) but if you have sued and taken the action to find out about your rights then I know you will be interested in seeing exactly what options are available to you and you will have lots of questions.

Many of which will be answered in the video above.

No default judgments by National Collegiate Student Loan Trust!

As with any debt collection lawsuit, most important thing is to not allow a default judgment to happen.

If you do, you lose.

Even if you do not owe the debt.

Even if you do not owe the amount of debt that you have been sued for by National Collegiate Student Loan Trust (NCSLT).

Generally, these lawsuits are filed and Circuit Court so you have 30 days to answer.

If the lawsuit is filed in District Court, then you have 14 days to answer.

The time to answer the lawsuit begins once you have been properly served.

NCLST is a debt buyer just like Midland Funding or Portfolio Recovery

The second critical step is to understand that National Collegiate Student Loan Trust normally purchases these private student loans when they are in default.

This means that the trust is normally considered a “debt collector” under the Fair Debt Collection Practices Act.

This also means that we need to look and see if the trust actually owns this debt.

Because only the trust can see if it owns the debt.

Debt buyers often do not have the proper proof to show they own the debt and are legally entitled to collect on the debt.

NOTE:  NCSLT will argue with the above statement and say they are an insurer of private student loans and they are not a debt buyer.

We won’t dive into all the arguments here but even if they are right — and I don’t believe they are — they still have to prove they own the debt to be able to sue in Alabama.

You have all of the normal defenses against a private student loan debt buyer such as NCT as you do against any other debt buyer

A third factor to keep in mind is that federal student loans have no statute of limitations (SOL).

However, private student loans do.

So we need to determine when the stats limitations begins to run so we can figure out if the suit was brought in a timely manner.

This can be a critical factor so let’s spend a moment on it.

“When does the SOL start running?”

Generally when you go into default.

“When did I go into default?”

We look at the contract — the loan documents — because they tell us.

We don’t have to guess — instead they are normally laid out in black and white for us.

Here are typical default provisions:

  • Fail to make payments
  • File bankruptcy
  • Move without telling the owner or servicer of the student loan

If these are not laid out in the document, then we look to state law which means at least when we default by not making payments.

Note, the SOL issue can get a bit convoluted depending on whether the loan has been “accelerated” so that it is all due or if the regular monthly payments are still due going out the next ten or twenty years.

The point is to look at this to see if you have a valid defense as the record keeping of NCLST is bad, at best.

Why NCO Financial (the large debt collector) is in the picture

NCO Financial is one of the largest debt collectors.

They’re a  company that often violates the Fair Debt Collection Practices Act, and it will appear in affidavits offered by NCLST because it claims to be the “custodian of records” for NCLST.

Having sue NCO many times, I question their ability to keep anything straight, especially important documents.

Additionally, these geniuses file affidavits that often contain your social security number, address, etc. which violates privacy rights and the FDCPA so watch out for this.

So NCO is involved because NCLST is part of a larger process called “securitization” that is understood in the mortgage world.

However, it’s not yet commonly understood in the student loan world.

It basically means some company made the loan, deposited it with another company, who then transferred into a trust which then makes investments available.

This was a large cause of the fiasco in the mortgage market where banks can’t figure out who owns what.

As an example, we have a case in federal court against Deutsche Bank and it testified it obtained the mortgage loan on a certain year.

Then when we deposed the corporate representative, the date changed by a number of years.

Then it changed again.

It was all based upon what would help the Bank’s defense against the lawsuit we filed.

This is typical.

We will see the same in the student loan litigation especially with the “trust” NCLST.

Does NCLST have the right to sue you in Alabama?

It depends.

It must show it owns the debt.

So you took out the loan from say Bank One of Ohio.

Now you are being sued by NCLST.

OK, how did it get from Bank One of Ohio to NCLST?

If NCLST can show how, and prove it with proper evidence, and if the SOL has not expired, then it may be successful.

If it can’t then it will lose and you should consider filing a federal lawsuit against NCLST for violating Alabama state law and the FDCPA (Fair Debt Collection Practices Act).

Bottom line — what to do next

Remember you must NOT allow a default judgment.

File your response/answer on your own if you can’t hire a lawyer.

But do something.

If you can, contact a lawyer.  

You are welcome to call us at 205-879-2447 if you live in Alabama.

You can also use this website to contact us.  

There are no guarantees but you should find out your options, the good and bad of each option.

This includes fighting the lawsuit and settling the lawsuit.

We look forward to helping you.

John G. Watts


  1. Emily says:

    I live in Georgia. I obtained a school loan through Bank of America (TERI) in 2006 and made some payments towards it into 2009. I am now being sued by National Collegiate Trust for over $35,000. I was served with papers on May 12th and have to file an answer within 30 days. I tried to call the attorneys office that is representing NCSLT and negotiate a payment of $150/month because this is all that I can afford. They are not willing to accept and told me I must put $3500 down and the payment would be $250/month until the debt was paid off. What are my rights? I’m not even sure that the papers that I was served with don’t violate my privacy because they contain my name, birthdate, place of employment, home address, and home phone number as well as my personal references info too. Do I have any right in fighting this or am I just stuck with it? I am so confused on how to handle it and don’t know where to start but I don’t have much time either…Thanks!!

    • John Watts says:


      I typed a response and somehow it did not get posted and I’m running tight on time so quick response.

      You can fight back — get a Georgia consumer protection lawyer ASAP as you don’t have much time.

      It may be that NCSLT doesn’t own the debt or that the statute of limitations has expired.

      If have more questions let me know — I’m not licensed in Georgia so I can’t talk about Georgia law but if there are any general principles you have questions about let me know.


      John Watts

  2. Mr. Ripply says:

    I had the same issue. I owed about 50K and went to settlebankdebt and they settled for less than 13K in multiple payments.

  3. Lashanda Mobley says:


    My mom and I was just served my papers of being sued. We both can’t afford to make payments at this time. Money is real tight for us. We took custody of our grandkids and nieces and nephews, so we are just trying to stay afloat of everything. I was in school during the period of the TERI loan and I stop going last year. I don’t understand how I am being sued so fast. I live in Florida. Please give some kind of advise as to how I should proceed with this. I will be writing a response to the court. Is there anything else I can do?

    • John Watts says:

      Hello Lashanda,

      Were you sued in Alabama or Florida? If Florida, definitely need to get with a FL lawyer. If here in Alabama we can chat.

      On these student loan lawsuits, you can always try to work it out. Sometimes that makes sense and sometimes it makes more sense to fight the case.

      If you were sued in Alabama, give my office a call at 205-879-2447 and ask for Carolyn to set up a time for us to talk.

      Do keep in mind you have deadlines on when to respond to the lawsuit — if you go past the deadlines they can get a judgment against you so you need to act quickly in responding.

      Best wishes on this and sorry being sued….

      John Watts

  4. Ms Boney says:

    I also have gotten a letter from a law firm for collection trying to collect a student loan that was gotten through Capital One but now says National Collegiate Student Loan. This was gotten like 12 or 13 years ago. I filed bankruptcy back in 2004 and had that included in the bankruptcy. My daughter is also on the loan she got the same letter I got. My question is after all this time and by me filing it on my bankruptcy are we still gong to have to pay this loan. Any advise or help you could provide would be greatly appreciated.

    • Ms Boney says:

      I stand corrected the loan was from Bank One.

    • John Watts says:

      Normally bankruptcy will NOT get rid of a private student loan so NCSL may still be coming after you.

      The statute of limitations may be helpful to you depending on when it started.

      Do you live in Alabama?

      If so give us a call at 205-879-2447 and we’ll be glad to walk you through your options.

      Best wishes

      John Watts

  5. I co-signed on a private student loan for my daughter and the loan went into default. This is a long story but the abbreviated version is as follows. First of all I am embarrassed to say that I was ignorant to the workings of the law and got sued for the debt and have a judgment against me. The loan was taken out through Chase. National Collegiate Trust contacted me about the loan but I thought I was speaking to someone from Chase and I sent them several hundred dollars to bring the debt current. This was a stretch since my husband has just lost his job in Oct 2008 and was without one for a year. The loan went into default in 2009. Last year I was served and I called Chase who informed me that they did not sell the loans to anyone and that they had heard of NCT but don’t do business with them. They told me that the collection company they used and said that they were calling all of the loans they had in collection back in. They said that NCT nor Nathan and Nathan were authorized to collect a debt on their behalf. During the period that I was served my mother in law died suddenly and my son had a hard time dealing with it. He started acting out in school and got into trouble so needless to say I totally forgot about the correspondence especially after talking to Chase and dealt with the crisis I was having at home. She died the end of April 2013 and I was served in July 2013 after being away with my son until then. I did go to see a lawyer for a consultation in September because I thought I had to go to court in Oct 2013. He then informed that I had been sued and there was nothing I could do about it because I did not respond in July. He really made me feel stupid and bad because he was basically yelling at me. In November I received a letter stating that I had a judgment against me. Later that month I received an offer from Chase to settle for a lesser amount. I called them again and told them about the judgment and they it was not possible for them to collect on a debt they did not own. I contacted a lawyer who proved to be a waste of my money because he did nothing. In December 2013 Chase issued 1099s charging off the debt but NCT and Nathan and Nathan were still coming after me. By this time I started doing internet research on my own and found out about NCT, and Nathan and Nathan. I also found out all the things I did wrong in handling the situation. Do I feel like a fool…YES!!!! I was listening to all the wrong people Chase and the lawyer I hired. My daughter and I have written certified letters to NCO, NCT, and Nathan and Nathan earlier this month giving them 30 days to verify the debt and their right to collect the debt. We both sent separate letters for each loan to all of them. NCO has sent two letters to my daughter referencing two of the loans saying that they will remove anything derogatory that was sent to the credit bureau concerning two of the loans (there were 5 in all)and suggested she contact Nathan and Nathan. I have yet to receive anything from anyone and I was the one they were coming after since she doesn’t have a means to pay. After releasing the lawyer I hired (because they wouldn’t talk to me until I did) I called Nathan and Nathan but the person I was referred to has yet to return any of my phone calls. This was before I sent the letters and after my daughter received the letters from NCO urging her to contact them. The 30 days are not up so we are still waiting to hear back. We have also filed a motion with the courts to vacate the judgment with an explanation and sent an answer to the summons for one of the loans I received earlier this summer(because I know better now). It seems that they are filing them one at a time. We need help!!!! I know it is hard to fight a judgment but I pray not impossible.

  6. Tamekia says:

    He I filed bankrupty chapter 13 back in 2009. My loans immediately went in default. I was discharged from chapter 13 in March 2014. Now I received a letter from an attorney office here in Alabama who is representing National Collegiate Student Loan Trust. I have never received anything from them until now. What do I need to do because I do not want to be sued? Please help!

    • John Watts says:

      Unfortunately a bankruptcy discharge normally does not get rid of student loan debt. I am curious if in your chapter 13 if you were paying for your student loans or not — if you were then you should have been relatively current at least in March 2014 when you were discharged from bankruptcy.

      NCSLT does sue in Alabama — the objective is to get a judgment against you so that the collection lawyers for NCSLT can garnish your bank account, your wages, put a lien or sell your property, etc.

      I suggest you contact the collection lawyer and find out what they say you owe, what type of plan they propose, and then make a decision. Or you could hire a lawyer to represent you to negotiate with the student loan collection lawyers.

      Normally the student loan collection lawyers will be Nathan & Nathan out of Birmingham or Barry Friedman out of Mobile — the letter will have the file number, the phone number, etc.

      Feel free to contact us at 205-879-2447 if you want to chat about your options or if you want for us to help you.

      I hope it all works out for you quickly!

      John Watts

  7. Karen says:

    I am being sued as a co-signer on my daughters student loan.She on the other hand has not heard a word. Why are they coming after me first

    • John Watts says:


      Either party that signed on the student loan can be sued. Together or individually.

      Often they know the parent is the one with the assets to protect, the income to protect, etc. and it often motivates the family to pay the debt. The child feels bad the parent got sued and the parent feels bad also!

      Sorry this is happening to you — make sure you get with a lawyer in your state to see if this is a valid suit, if you have defenses to the lawsuit, and in general “what are your options”.

      Thanks for your good question — sorry I don’t have a “better” answer for you but that’s the law in Alabama and in most states I suspect.

      John Watts

  8. LP says:

    My received a letter for civil action from NCLST. We have never heard from this company or received a default letter. I live in GA I called the filing lawyer and the assistant would not let me speak to the lawyer, And was getting smart with me and would not help me get to the bottom of the loans and also would not send me the documents saying I signed for the loan. I would like to settle this out of court and keep from garnishing my fathers wages since he co-signed. Can you please recommend a GREAT lawyer in Georgia that can help me with this or help me get a settlement pay off.


  9. Monika says:

    I am having problems with NCSLT because I asked for proof they still own my loans but I have not received it as of it yet. I want to move my loans to another servicer, my loans are not in default but AES is a horrible servicer plus they constantly misapply my payments. They have marked my credit multiple times for misinformation they gave me which is a violation of the Consumer Financial Protection Bureau, I need help because AES is ruing my credit.

    • John Watts says:


      Sorry you are dealing with this.

      If AES is doing false credit reporting, then the solution is to properly dispute under the FCRA (Fair Credit Reporting Act) and if they don’t fix it, you sue AES or whoever is doing the reporting.

      When they end up paying you money damages, that tends to get them motivated to straighten their act up.

      If you live outside of Alabama, get with a consumer protection lawyer in your state who is experienced with the FCRA and student loans.

      If you are in Alabama, we’ll be glad to help you — give us a call at 205-879-2447.

      Best wishes — I know it is frustrating — so keep up the fight as you must make sure your credit reports are correct.

      John Watts

  10. Carlos Morales says:

    Hello, i was recently presented with a lawsuit by the National Collegiate student loan trust. I called their attorney’s office Solomon and Solomon, in order to work out some sort of deal. They told me that they could only do $250 for 6 months and that after that it was going to keep increasin by $50 each 6 months. I kept asking if bu doing this the lawsuit would be dropped but they wouldn’t give me an exact answer. Should i keep this deal or try to make an appearance for court. I am currently in CT.

    • John Watts says:


      I don’t know the law in CT but I’ll give you some general thoughts. Do make sure you have responded to the lawsuit or have an agreement with lawyers that you don’t need to respond as your time may be running to answer the lawsuit.

      My suggestion is make sure you fully understand what will happen if you settle. Will the lawsuit be dismissed? Held off to the side while you pay, etc?

      Best advice is to get with a lawyer who handles student loan cases and who can help you deal with these collection lawyers — it may be best to settle or maybe best to keep working on it.

      Thanks for your comment and sorry I can’t help you directly — best wishes!

      John Watts

  11. Heather Lee says:

    I was served with papers from NCSLT yesterday and they are trying to collect 35K. I live in Alabama

    • John Watts says:


      You should have been sued in Circuit Court so you will have 30 days from 6-6-2015 to respond to the lawsuit.

      If you do nothing else do this: respond to the lawsuit in the time limits.

      You can do this on your own — won’t be easy but better than doing nothing. Or you can settle it — lump sum is the “cheapest” as everyone likes money in hand or you can work out a monthly payment plan with NCSLT. They will almost certainly insist on a consent judgment however so be very careful of that.

      Or you can hire a lawyer to fight for you or to help you settle. We typically are hired to do both — we fight but if NCSLT makes a reasonable settlement proposal then that is something my clients will look at doing.

      If you would like help thinking through your options (and please watch this video https://youtu.be/0WV_pFnaZ78 first) I’ll be happy to speak with you.

      Call 205-879-2447 and ask for Carolyn — she’ll get the details, pull the court file, etc. and set us up a call.

      Congratulations for taking action — you are way ahead of the game just by doing that. Now keep up the good work and you can get through this rough patch….

      John Watts

  12. Sue says:

    I’m being sued by National Collegiate Trust in Virginia; can you recommend any lawyer in Virginia to help me? Thank you.

    • John Watts says:


      Jason Krumbein is someone who either can help you or can point you in the right direction. Best wishes!

      John Watts

  13. Taylor stonecypher says:

    Hi, my sister and I both took out student loans for school and my father was the co signer. We are all three being sued. The thing with mine is I was making my payments, granted not always on time but never thirty days pass due. Out of nowhere, I was no longer able to make payments and was told I defaulted on my loans. My dad had filed for bankruptcy. Would that have caused me to default on my loans. Also, can you recommend a good lawyer in the St. Louis, mo area.

    • John Watts says:


      I’m sorry you are being sued. If a co-signer files for bankruptcy, then normally this means the loan is in default and often the student loan company won’t take payments any longer. Part of this is trying to be careful about not violating the rule in bankruptcy called the “automatic stay” which means the creditor can’t collect against the person in bankruptcy.

      So they kind of lump all of you into bankruptcy status and shut the account down.

      Did he file chapter 13 (debtor’s court) where he is making payments into court or did he file chapter 7 (straight bankruptcy) where he is wiping out his debts?

      Can you pay now?

      Do you have your money set aside that you would have paid every month?

      I don’t personally know any lawyers in St. Louis, MO area but you might check out NACA (http://www.consumeradvocates.org/find-attorney) to find a lawyer in your area.

      Best wishes and I hope that you can get this straightened out ASAP. It sounds crazy but sometimes it is easier to resolve things when you are sued because you have a collection lawyer on the other side — not always but often they are pretty reasonable and practical. Hope that’s the case with the lawyer in your case…

      John Watts

  14. Ann Lui says:

    Does Statue of limitation counted on NCSLT state-lender ?
    or student loan borrower state ? Thanks!

    • John Watts says:

      Ann Lui,

      That’s a great question.

      It depends on what the contract says and what state the borrower lives in but in Alabama generally we use Alabama statute of limitations law. It is not absolute but that’s the general rule.

      So normally for National Collegiate Student Loan Trust cases we are talking about 6 years after you stop making a payment. I just spoke with someone tonight who has not made a payment in over 8 years and just got sued — that’s a big problem for NCSLT.

      Hope this helps….

      John Watts

      • Ann Lui says:

        Thanks John:

        I live in New York. Borrow student loan from chase bank in the year of 2007.
        The NCSLT sue me they are my original lender and they have my promissory note. I Knew the only private student loan I borrowed was Chase bank with family member as co-signer. NCSLT claim they are original lender, and the law suit has no co-signer’ name.
        I want to know if I am not in New York, does my co-signer can represent me in the court ?

        • John Watts says:


          I’m not sure about NY law — need to get with a student loan or consumer protection attorney there to find out. Normally the only person that can represent you is yourself (called being “pro se”) or a lawyer so I don’t think your co-signer could represent you.

          John Watts

  15. Ann Lui says:

    Hi Join:
    If my co-signer can not represent me in court because the defendant name is not her, Can she represent me consult with an attorney and hire an attorney for me ? Thank you!

    • John Watts says:

      Normally someone else can hire an attorney for you so at least in Alabama your co-signer could hire an attorney for you. I don’t know NY law but I suspect it is the same. Best wishes!

      John Watts

  16. Ann Lui says:

    Hi Join:
    Does preliminary conference order form have to be filled by both plaintiff and defendant ?
    Does preliminary conference form same thing like stipulation ?
    Can both parties directly come to a reasonable settlement without filling preliminary conference form ?
    Does the settlement must to be approved in the trial in front of Judge ?
    No idea bout procedure in the supreme court.

    • John Watts says:


      Sorry I don’t know what the law is in NY either — get with a NY lawyer and I’m sure they can tell you the answer easily.

      John Watts

  17. Ann Lui says:

    Hi John:

    In order to get the reasonable settlement, is it best way talking to NCSLT ? or their attorney ?
    Who make decision on settlement issue ?
    Thank you!

    • John Watts says:

      Normally when NCSLT files suit they will want you to talk to their attorney. It may be different in NY than in AL but I suspect it is the same. Get with your own lawyer in NY and they should know the answer.

      Hope it works out great for you!


  18. JW says:

    If my private student loan debts has been transferred to the US Department of Education and I am making monthly payments to them, does NCT have a right to sue me? I live here in Alabama. The reason I am asking is that I have received advertisement from lawyers stating that there is a pending lawsuit against me from NCT, but I have yet to be serve the paperwork.


    • John Watts says:


      Normally if you are getting letters then you are being sued. Call us at 205-879-2447 and ask for Carolyn — she can look up the case for you and tell you if you have been sued. She’ll look up your name, your county, etc. and let you know what she finds.

      Normally if the loans are federal they don’t go to private so I’m not sure if these are federal or private. If NCSLT is suing you, however, that is almost always a private student loan. Usually from Charter Bank or Bank One, etc.

      Give us a call (205-879-2447)and let’s figure out what is happening.


      John Watts

  19. Ann Lui says:

    Hi John:
    Thank u so much for all your reply.
    Sorry I have asked so many questions.
    another thing I want to find out if a person filed bankruptcy and the judge approved.does she still have to pay the default judgment ?

    • John Watts says:


      If there is a judgment and the consumer files bankruptcy (chapter 7) and receives a discharge, then the judgment should be taken care of unless it is non dischargeable. For example, some alimony, taxes, and student loans may not be dischargeable.

      The lien on a property may still be present but normally the judgment would be gone.


  20. Ann Lui says:

    Hi John:
    As I mentioned before I borrowed private student loan from chase bank in the year of 2007. NCSLT sue me that they are original lender they have my promissory note.
    If NCSLT are debt buyer of chase bank, Can they claim they are my original lender ? Thanks!

    • John Watts says:

      That depends on your state’s rules — some states require a “debt buyer” to identify themselves as a debt buyer and trace the chain of title back to original creditor (Chase Bank here).

      All depends on where you are and how the judges rule on these matters.

      Best wishes

      John Watts

  21. Ann Lui says:

    Hi John:
    I heard that there is settlement tax.
    If I got a settlement with NCSLT at amount of $10,000
    dollars, do I have to pay additional settlement tax ?
    If yes, why and what is the percentage ?

    • John Watts says:


      Usually if there is “debt forgiveness” then the amount forgiven (or perhaps just the principal) can be considered taxable income to you.

      Here’s the concept.

      If I borrow $25,000 from you, do I pay taxes on this amount? No.

      But what if I never repay it and you “forgive” it.

      Then the IRS will often say, “Well now we will consider the $25,000 to be taxable income to you.”

      There are all sorts of exceptions and other factors that influence this but do be aware if you settle for less than the full amount, there may be tax consequences next year (i.e. for this tax year).

      Hope that helps!

      John Watts

  22. Ann Lui says:

    Thanks John:
    Very knowledgeable !
    There is another thing I want to make it clear.
    In the student private loan promissory note, if it is required that must be a co-signer in order to release the loan, but finally it turns out the loan check issued without a co-signer.
    Does the Bank have violated the law ?

    • John Watts says:


      You are welcome.

      I’m not familiar with that type of provision. But if the contract says in order to release the money the co-signer must sign off on releasing the check and if that wasn’t done, then that may give somewhat of a defense. So much depends on the law that applies — I think you are in New York.

      Definitely share any thoughts/questions with a consumer lawyer in your state so they can tell you which ones are important in your particular case.

      John Watts

  23. Ann Lui says:

    Thanks John:
    I will definitely share your thoughts with defense lawyer in New York let them know your judgment.

  24. Ann Lui says:

    Merry Christmas !

    Hi John:

    I heard that there is a new law that if the student loan can not pay back in 20 years. After 20 years the debtor does not need pay any more. Is it true. Thanks!

    • John Watts says:


      There are all sorts of federal student loan programs — some do involve forgiveness if you are in the right program, making the right payments, etc. But no general rule that I know of that simply says after 20 years they go away.



  25. Ann Lui says:

    Happy New Year!

    Hi John:

    If the plaintiff work out a stipulation paper, the defendant signed and plaintiff not signed, is this paper considered valid in court?
    If the plaintiff e-mail a fully signed stipulation paper,
    the full signed down loan copy can be considered valid paper in the court ?


    • John Watts says:

      Happy new year to you also!

      Your question is a good one — I don’t know the law in NY.

      I know in Alabama the stipulation needs to be signed by all parties or the parties can verbally tell the judge in “open court” (in the courtroom) that they stipulate to something.

      Hope that helps — make sure you get with a lawyer in NY (I think you are in NY?) or wherever the suit is as laws can vary based on the state.

      Best wishes

      John Watts

  26. Mitsy says:

    I from Texas I am my mother was my cosigner in 2007. She being sued by NCLST I have tried to make arrangements to pay this loan lost my job and home due to financial hardship. My mother is sickly and I have 20 day to answer. I am upset with there tact instead of sue me you are going after a sick woman. Any suggestions will be greatly appreciated.

    • John Watts says:


      Sorry I can’t help you but I don’t know the rules in Texas and I’m not licensed there. As a general rule, NCSLT can sue one or both of the signers/co-signers. Often, they sue the parent or grandparent as they typically have more money and it is upsetting to the adult child. More upsetting than being sued.

      I would get with a Texas consumer protection lawyer ASAP to find out what your options are — maybe some rules in Texas that will help.

      Sorry I can’t be of more help….

      I hope you can get this handled quickly and put all of this behind you.

      John Watts

  27. Gerri says:

    I received 3 civil summons, 1 for each student loan obtained by myself with my Mother co-signing, from Nathan & Nathan representing National Collegiate Student Loan Trust. The original lender on 2 of them was Charter One Bank and PNC Bank on the other one. They provided copies of each of the contracts. Is this proof that they are the rightful owners of the contracts? I have not worked since 11/2014 except for 1 day in 1/2015 due to health reasons. I have filed for SSDI and have been denied. I recently filed a 2nd appeal. My Mother is already getting SSDI. Can they garnish her wages or take my parents savings or retirement account money?

    • Gerri says:

      Also, why are they attempting to contact me by phone after have me served?

      • John Watts says:


        They may be calling to see if you want to agree to a settlement.

        If you have been served (sounds like you have been) then remember it is MISSION CRITICAL to respond to the lawsuit before 30 days runs out from when you were served in each case.

        Must treat each case separately so you would be filing 3 answers. Or hiring a lawyer to file 3 answers (responses) to the lawsuits.

        Best wishes and talk soon if you would like to go over your options.

        John Watts

    • John Watts says:


      Sorry you are dealing with this.

      Normally Nathan & Nathan will attach the original contracts to the lawsuits. It only proves that they have attached the original contracts. It does NOT, in my opinion, prove they own the debt. It simply means they have a copy of the contracts.

      Now, they (National Collegiate Student Loan Trust) may be able to prove they own the debt, but simply attaching the contracts does not prove that.

      As far as what they can take IF they get a judgment, normally they cannot touch SSDI or retirement accounts (IRA, 401k, Pension, etc). But they can wipe out checking and savings accounts unless the money is SSDI money. They can put liens on properties. They can even force the sale of properties IF they get a judgment. And if anyone they sue is working and getting wages, they can garnish the wages up to 25%.

      Give us a call and let’s go through your options. You can call Carolyn in my office — just ask for her when the receptionist answers at 205-879-2447. She can look up your cases online and then set us up a free scheduled call to go over your options.

      Sorry you are dealing with this — be glad to help you understand your options.

      John Watts

  28. Monty says:

    I was sued by NCSLT and in an effort to prevent a default judgement and garnishment of mine and my co-signer’s wages. I made the mistake to settle on a consent judgement.

    Is there any way to have this judgement overturned or any way to keep fighting? I did not know I had any options before. Can you help me?

    • John Watts says:


      I understand your frustration — this is a confusing world of dealing with lawsuits and we don’t always know our options.

      Normally once you agree to a consent judgment, very hard to undo. Maybe if it has only been a short period of time. Call us at 205-879-2447 and ask for Carolyn. Give her the date of the judgment and Alabama court number and we’ll see if anything we can do to help you.


      John Watts

      • Monty says:

        The consent judgement was filed very recently (less than 5 months ago) and if there is any action I can pursue, I will be happy to make an appointment.

        • John Watts says:


          That’s going to be difficult but let’s take a look at it — we can set up a phone appointment and chat. Call us at 205-879-2447 and ask for Carolyn — she’ll make arrangements. Let her know we connected here and I asked that she set the appointment up.


          John Watts

  29. Ashley says:

    Hi John,

    First of all thank you for creating this forum! It is hard to find a forum of such content. I just received a letter from a law firm saying a lawsuit in Fulton County Court (in Atlanta, GA) has been filed against me by NCSLT. I have not received anything in the mail from the court. I went online to look up the case # and saw that it has my old address. Also, this debt was with TERI LOANS back in 2003/4 and then was sold to another company who sued me in Ohio where I lived when the loan was taken out. The court letter was sent to an address in Ohio that I had not lived at in 4 years…therefore a default judgement was granted. They then presented this judgement papers to the Dekalb Court years later and garnished my wages for 6 months. Once the judgment expired (because they waited years to even garnish…that was the end. I contacted the Ohio court because in their system it shows I was never served because the address was not valid. Moving along to now….this new company NCSLT is suing me and this loan is 15 years old from the original date. Is there a reputable attorney you can recommend in Atlanta? How can I find out the statue of limitations? I will never let them get a default judgement on me. Thanks in advance!

    • John Watts says:


      You are welcome — thanks for the nice comments!

      Sorry about your experience with Ohio but sounds like you got that resolved. Did the judgment get set aside because you were not served or did it become too late to collect on it?

      If not set aside, I’m curious how they can sue you now in Georgia if you have already been sued in Ohio.

      I would suggest looking up Steve Koval in Atlanta — a friend of mine who I have worked with on some cases. Good guy. Tell him I sent you and he’ll take good care of you.

      Best of success!

      John Watts

      • Ashley says:

        Hi John…I have been trying to reach Steve with no luck. is there anyone else you can recommend here in atlanta or do you have a contact # for Steve….each # I have called the voicemail is full and no real voice message is available so I am not even sure I am calling the right person. Any help is greatly appreciated.


        • John Watts says:

          Ashley, just sent you a private email with a new number. Not sure what is going on with his old number but look for that email thanks!

          John Watts

  30. Anabella Stancarone says:

    Hi, my son took out a student loan for $30,000 with Citizen’s Bank back in 2006, his grandmother co-signed. He has not been able to find steady work and i have been paying as best i can. AES is the servicer. I fell behind on payments and have been trying the best i can in sending $495.00/month. His grandmother has dementia now and can no longer help. I contacted AES and was told that NCT owns the loan, i had never heard of them, but looked them up and found they were being sued for collecting loans they couldn’t prove they owned. My son has repeatedly asked for proof of the transfer of the loan as he was never informed that it had been transferred. Now a collection agency has written stating that they were hired by NCT to collect 53,000, the current amount owed on the 30K loan. What should he do? They have never responded to his request for proof of ownership of the loan.

    Also, the loan was taken out in NY and now live in TN. Please advise.

    • John Watts says:


      You’ll need to find a consumer protection attorney in TN as I don’t practice there.

      One thing to consider is writing a dispute letter (even if wrote a previous one) and specifically asking for proof that NCT owns the debt.

      You are probably dealing with Transworld Systems Inc which is a primary collector for National Collegiate.

      Here is an example of a dispute letter but you could also add something like, “I understand National Collegiate Trust and related companies have been fined for not having proof of ownership. I dispute that you or National Collegiate have the right to collect this debt. Please validate by showing me proof of ownership.”

      But talk to a TN consumer protection lawyer first as sometimes it is best to not ask them to prove it — for example, if they are about to sue and they won’t prove it in court, sometimes best to let them do a sloppy job in court and beat them in court.

      Bottom line is there are lots of factors based on your state, the law there, the quality of the collection lawyers, etc. and you have to consider them all before taking action.

      Best wishes

      John Watts

  31. Shannon says:

    Hi John.

    I received a letter in the mail from Nathan and Nathan that I was being sued by NCT for $8800. I had filed Chapter 13 in 2014 and I was under the impression that my loans were essentially put on hold (or a stay maybe) until I was discharged from bankruptcy. I got discharged and immediately received this letter, by mail only. It looks like they defaulted on me immediately. My loan was originally through AES, so this is the first I have heard about NCT. Looking on my account online, it only shows my last payment made but I can’t find any details on the loan at all with AES. What should I do? Should I ask for proof of who owns the debt? Also, would I be considered properly served if I only received this by mail and not certified or by sheriff? any info would be appreciated!



    • John Watts says:


      I’m assuming you are in Alabama — Nathan & Nathan does file lawsuits in other states. But let’s go with Alabama.

      The loan should have been “stayed” — the “automatic stay” — until it was lifted or you were discharged from the chapter 13. Other option is if didn’t finish the chapter 13 and it was dismissed but sounds like you were discharged.

      The stay should have been in effect unless AES or NCT (National Collegiate Trust) asked the bankruptcy court to “lift” the stay or give them “relief from the stay”.

      Now if they waited till discharge and then sued, that may be ok. But you need to see if your chapter 13 payments made it to the student loan company. And also there is typically a form filed by the trustee to say whether the debts included are current or not. That can be helpful.

      Bottom line is get with us on this and pull your bankruptcy filings — or you can ask your former bankruptcy lawyer to help you with this. Our number is 205-879-2447 and ask for Carolyn. Mention to her about the bankruptcy angle and send us whatever you have from court.


      John Watts

      PS — on the service — a letter by regular mail is not service. They probably are saying that they are suing you — to be officially served you need to get it by personal delivery to someone in your home, certified mail, etc. Not regular mail. But the bottom line is we need to see if there is an actual lawsuit filed against you, when it was filed, and when the court thinks you were served. Carolyn can look that up for you — 205-879-2447.



      • Shannon says:

        Thank you so much for the info. I am in Dothan, Alabama. From the looks of it on my credit report and where I had the loan with AES, it says I defaulted November 2014. I entered bankruptcy in October 2014. I didn’t receive anything informing me I had defaulted on any loans. My federal loans with AES are still there and have kicked back in. They didn’t send me this letter until I had been discharged, basically stating I have 30 days to respond or their office will assume this debt is valid. I am sending a certified letter tomorrow disputing it. I will find out from my bankruptcy lawyer if the stay was lifted, but I would imagine they would have let me know this or even received a letter in the mail. I do know that no payments were made to my student loans during bankruptcy. I will see what all I can find out and be in contact. Thank you again!!


        • John Watts says:

          Sounds good — reach out to us by phone and ask for Carolyn. 205-879-2447. Tell her we have been chatting and send her documentation of what you have and we’ll be glad to help you.

          Best wishes!

          John Watts

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