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Ely, Counselor at Law
Category: Consumer Protection Law
Satisfied Customers: 24667
Experience:  Private practice with focus on family, criminal, PI, consumer protection, and business consultation.
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I am a co-signer of a student loan issued by AES to my son.

Resolved Question:

I am a co-signer of a student loan issued by AES to my son. he defaulted and I picked up payments with the credit collection agency. this loan has been "sold" to three different agencies across the last 3 years. i have paid monthly and done so diligently, but, each time the loan is "sold" there is no notification. Each agency says to contact the original client which is AES. I do so and AES knows nothing. Then I get a dunning collection notice 60 to 120 days later from a NEW agency. How do I get out of this circle?? Who is the holder of the loan? how do i find the correct information?
Submitted: 8 years ago.
Category: Legal
Expert:  Brandon M. replied 8 years ago.
Hello there:

This does not quite make sense to me; help me to understand. You cosigned a loan with AES. Your son defaulted. AES sent it to a collection agency. All of that makes sense.

My confusion is with the sale of the receivable and the withdrawal from your account. Although a creditor certainly has the right to assign their receivable, it is usually not sold to a collection agency; the collection agency usually just handles the collection aspect. So, to start, I am hoping that you can verify that the loan itself is actual being sold between credit collection agencies. You asked who the holder of the loan is--do we know if the loan is actually being sold?

Secondly, I am confused why they would claim that you are delinquent on your payment with each switch if you have a direct withdrawal set up; is there a pause in the payments? Is money going out but not being acknowledged by the collection agency?
Customer: replied 8 years ago.

This loan has passed through the hands of three collection agencies. Each time this has occurred the following scenario happens. Credit agent contacts myself and makes a statement that this debt is being "pulled" from their respective company by their client, AES. Then the credit agency representative proceeds to ask if I would like to satisfy the debt at a much lower total and the figure is given. At this point, I have said no three times and on each occasion 30 days later I no longer have a payment being automatically pulled from my checking account. Then, 60 to 90 days later I receive a dunning letter or phone call from a "new agency".

Today, as I have the last two times, I contacted the current Credit Collection agency to inquire as to why they were no longer sending me a statement or taking payments. Response was that their client pulled all accounts from this particular agency. I asked why I had not been notified and was told they were not responsible to do so. The Representative told me to contact AES to see who now had this debt. So, I am on a Merry-Go-Round and need to get off. How do I identify who holds this debt? thanks

Expert:  Brandon M. replied 8 years ago.
It is not clear to me why a collection agency is involved at all at this stage if you are making monthly payments. Are you behind on your payments?
Customer: replied 8 years ago.
No, I am not behind on any payments. Have not been behind since I picked up the loan from my son(college loan). How do I go about identifying what company actually holds this loan?
Customer: replied 8 years ago.
Fyi- I have been in contact with AES via email since you cannot get a human voice in their phone system. Their response was the loan was in default and they no longer serviced it. It was passed to the Guarantor which they did not name. I replied that in each case the collection agency pointed to AES as the "client" that was taking back the loan. And, that I was directed to make all inquiries to AES. In addition, I requested accurate information from AES and did ask for the guarantor. Simply feels like I am stuck in a circle. Any idea as to how to proceed?