We’ve defended a number of National Collegiate Student Loan Trust cases over the last few years.  Initially, in mid 2012, there was an onslaught of new client inquiries.  We were getting calls every hour about these cases.  We were retained on a number of them, and we have been successful on all of them.  Then, it appeared that National Collegiate (NCT) disappeared.  It seemed that they had given up based upon a lack of success.  Recently, however, we’ve seen a new influx of NCT cases.  The lawsuit look the same, but now they are using other attorneys.   Not a bad strategy…

So who is National Collegiate Student Loan Trust?  Well, its not such an easy question to answer because there are so many of them.  From what we can gather from the lawsuits that we’ve defended, in the years 2004 through 2007 many private student loans were sold to a company called National Collegiate Funding.  The sale appears to have been brokered by a company called First Marblehead.  National Collegiate Funding then securitized these loans (technical term that means “make these available for investors to invest in”).  National Collegiate Funding set up many separate companies known as “National Collegiate Trust”.  From what we can tell, there were 5 trusts for each year during 2004 though 2007.  AES was hired as a servicer for the loans.  TERI was in place as a guaranty company.  ( A guaranty company pays the loan if the borrower defaults).  Many times, borrowers had no idea that National Collegiate Funding owned their loan.  Sometimes, documentation or invoices would be sent by AES.  Many times, nothing occurred.  The loans got “lost”.  Now here we are almost 7-8 years later, and people are facing lawsuits from a company that they’ve never heard of.  Welcome to the world of National Collegiate.

The shock and sincerity that I hear from my clients is real.  “I’ve never heard of this company”…”I’ve never made a payment on that loan because I’ve never received an invoice”.  These are some of the common statements that I get on these cases.  Well, in that instance, I advise my clients to defend the case.  National Collegiate Trust has a few things to prove when they sue you on a private student loan.  First and foremost, they have to prove that they own your loan.  This is a very difficult thing for them to do.  Just because they have a copy of your loan doesn’t mean that they own it.  They need to produce documentation, contracts, indicating that they bought your specific loan.  To date, I’ve yet to see complete documentation from NCT indicating that they owned one of my client’s loans.   How in the world can you sue someone if you cannot prove that you own the loan?  On the flip side, as a borrower, how can you consider settling with them if they cannot prove that they own the loan?  Its simple, you just can’t consider it.

If they can prove that they own your loan, they would next have to prove that there was a loan, that there is a specific amount due and owing, and that they are within the Statute of Limitations.  NCT can sometimes prove that there was a loan.  They seem to have difficulty in proving the balance on that loan because they have incomplete records in most instances.  This also makes it difficult to prove that they are within the statute of limitations.

Having said all of that, I think that you can see pretty clearly what you should do if you are sued by National Collegiate Student Loan Trust.  DEFEND the case and make them prove everything that they need to prove. If they can do that, or even approach that, then you might consider settling with them.   If you are in Pennsylvania and are dealing with NCT, please call our office at 412-823-8003 for a consultation.