Fraudulant Student Loans.....HELP

Back in 1991, I live in SC, I attended a small college, Watterson College, they obtained student laons for me with the understanding that the only reason I was signing for the loans was that the loans were going to be wipe out by my GI Bill. To be done by the college. Needless to say, this never happened, the college, told me I had to pay them $1,200 more or I could not continue attending, yet they put down on my transcript that I graduated with a diploma in Micro Computer Science, that I have never seen. Now the loans that were only $5,000.00, are over $14,000.00, and the lender states that there is nothing that can be done and that I am going to be stuck paing for an education that I did not get. I would love to sue the College, but they filed bankruptcy in yearly 93, which I did not know about till reacently. Any help would be great. Thanks.

I, too, live in SC and have attended college, grad school and law school there. My first recourse when I had a problem with a state other than SC ( I guess the process is basically the same for any state though) was to contact the states ombudsman. From there he put me in touch with the proper authorities to pursue my case, which was the College Student Aid Commission in that particular state.

In my situation, the school neglected to take my student loan funds made available through the federal government. So, when I went to register for my second term, they should have stopped me and said, "Hey, we never receive payment for the first term". Note--the money did not ever come TO me--it wen't from Student Loan Corp directly TO the school. It wasn't my responsibility to pay. Therefore, instead of TELLING me they screwed up, the "padded" future billings to my student loan company to make up for the amount they "forgot" to collect. When I withdrew and went to another school, suddenly they sent me a bill for six thousand dollars, and finally admitted their 'oversight'. My position was --it wasn't my job to make sure they TOOK the money. It was THEIR job to take the money, and when they realized they didn't, make me aware of the problem right away so I could FIX it at the time--not two years later.

The school is still very much in existence and they lost when I sued. I did not have to repay that amount of my school bill that they neglected to take, only my student loans from a third party. But since your school is bankrupt, you cannot get money from them, in all probability.

However, your student loans aren't WITH the school. They are with a third party, right? These must be repaid no matter what--since you signed the documents----although I have to admit, I am not sure what you mean by signing a student loan to cancel out another. Once those documents are signed, its a long road to get that "undone". It may cost you more money to hire an attorney than it would be just to pay it. Also, after all these years? I am not sure how you could prove any of this.

Call your ombudsman and ask if he knows of who handles complaints like this or if there is a South Carolina College Student Aid Commission.

I'm not an attorney. My neighbor had some old student loans reappear that were past limits to collect. I guess if the loans have been sold, the same obligations don't apply. It's tricky sometimes. Of course this may vary with your state - but do your research.

Unless privately obtained ( personal loans), student loans are government loans and , even if they are bought and sold between companies, they still must be repaid.

That doesn't mean the posters do, I am just speaking in general terms. Government student loans must be repaid--period.

Also of interest is that the posters situation has been going on for almost eighteen years and it has not been addressed yet. I am sure this has affected him credit wise---student loans are an absolute MUST REPAY bill----the govt can go to great lengths to get repaid for these---I also have questions about getting a loan to cancel out the GI Bill---that, too , make no sense.

I suspect there is more to this than is relayed here. Schools do not obtain loans on behalf of students---those agreements are entered into BY the student and he/she is responsible for them---the school receives the money, but only AFTER the student has borrowed the money.

Grace, Things have changed. Schools DO the paperwork and they DO get the money and they DO disburse the money. So if there is a problem with their accounting or that they HAVE gone bankrupt, you still have a government loan. But I'm not understanding why you have not gone to the folks at Veterans affairs as to why you did not have your student loan wiped out by funds you were entitled to as a veteran....?????