In 2007-08, I was convincingly sold on the idea, via online ads you will not find anymore, to borrow private student loan
funds that would "conveniently" be overnight delivered to my own home (that's illegal if a lender wants to call its product a student or, in legal vernacular, a "qualified educational loan"
Further, these private student loan lenders enticed me, the student with the belief I could receive a check overnight in any amount: "$20,000, $30,000 $40,000, even $100,000 (again illegal practice I later learned if a lender intends to market its product as a "qualified educational loan."
Finally, I was told the loan funds would be under my complete control to spend how and when I needed to (yet another factor disqualifying this type of loan as a qualified educational expense."
I learned, via FinAid, that in the early years after the law changed to make private student loans non-chargeable, that some well known student loan lenders were deliberately circumventing parts of the law in order to sell unsuspecting students like me what they called private student loans for the express purpose of trying to make them bindis chargeable in bankruptcy.
In reality, these loans are nothing more than unsecured direct to consumer loans.
Was this fraudulent behavior on the part of these lenders? In 2010 the BACPCA law changed such that a student coil not take out a private student loan until they had exhausted all available federal student loan funding.
But I got caught in this mess in 2007-08. I ended up on permanent disability, and these lenders hounded me day and night for payment. I paid when I could, but I also had medical expenses that came first.
Finally, with one lender, I made my last payment to them in October, 2014. I had received a collection call, and told the collector if they intended to send me a summons, I would take it to the courthouse and file a slow pay motion against them, and see them in court. The collector said "Now, now, now, we don't have to go down that path do we?" I never got another collection call from that lender.
I did get a collection call (the last one ever) from the other lender, who tried to plead with me "But we gave you that money to use any way you wanted." I told her that that right there was the problem and why this loan wasn't a true educational expense loan at all.
I never heard from that lender again either.
These loans remain on my credit report
, showing $0 balances as charge offs. Due to my sudden onset disability that dropped our family income by 70%, my federal student loans were discharged without argument. We did have to file bankruptcy, I brought the lawyer all the supporting paperwork I had on these "fake" student loans, but he wouldn't even look at it, I wouldn't discharge these fake student loans.
But I'm wondering, was I defrauded by these private student loan lenders since what they sold me as private student loans in no way meet the legal requirements to be qualified educational expenses, and thus, indeed did chargeable in bankruptcy as direct to consumer unsecured loans?
With these fake student loans hanging around on our credit reports, we can't get a credit card, a loan for dental surgery I need (I'm going around with a missing left front tooth because of this).
I want to know if we were defrauded, and what we can do about it. I know a discharged bankruptcy can be reopened for adversary hearings, but is there more to this than that?
We have been through hell with these lenders for 5 years now. We were hounded and hounded, our lives were made miserable, we cannot obtain credit of any kind, if if one looks at our credit history, it's obvious we never mind sided one creditor payment ever, until this mess with the fake private student loans.
I do intend on contacting a different lawyer who maybe will take the time to read the documentation on this I have, complete with cited U.S. code to back up what is then explained in plain English.
If we were defrauded, do these lenders owe us back all we had managed to pay them? Maybe even damages for years of mental anguish and the fact if not for their fake loans, I might be able to secure the needed credit to get my front tooth replaced?