Hi Heather,
Our son owes about 180k in private student loan debt on all of which I am cosigned.  It started in 7/03 and continued to sometime in the beginning of ‘07.  He did not finish school.  He did not get a job in his major.  He is 28 years old now. He lives with us (my wife and I).  Our relationship with him is good (we still love him unconditionally).  My son and I have talked many, many times about this issue.  In 9/09, I had to retire at age 60 and go on permanent disability because of health issues.  I am now soon to be 65.  Since the loans started coming due for payment (I think in “07), my son and I have had zillions of calls and letters from the original places who made the loans then to collection agencies. I must confess I am not a good organizer or record keeper so I don’t know who all he owes.  I am able to glean some information from my credit report.  So far there have been two court judgments against my son and me.  His wages have been garnished for awhile then it stopped when he changed jobs.  The current status of it all is…..I don’t know. Again I have to say I have been no good at handling all of this.  There are some other extenuating circumstances in our lives none of which have anything to do with the loans but do have an affect on dealing with them.

Recently, I attempted to refinance our home mortgage.  I found out that the two judgments on my record pull up a big red flag and have not made it possible.  So now since I have read about what conditions would constitute the loans being forgiven or charged off for our son.  Obviously, one is death.  The other is permanent disability.  Neither applies to our son.  In my case, being the cosigner, can permanent disability remove me from the whole situation?  My wife and I both on SSD as our only income (she is not cosigned on any loans).  My small 401K I had is long gone.  We have no assets, land, stocks, etc.  Is it possible for me to be able to get free of all this to be able to refinance our home?  I have told everyone who has called here that I never was trying to run away from all this. I just couldn’t pay.  I never thought I would be retiring early at 60 and certainly not going on disability. One other item, Nelnet started sending me letters a number of years ago about being released from certain loans and as of 6/15/13 because of disability I have been on.  It amounted to about 16k.  I don’t know which loans were about. Now again, I must apologize for not staying on top of this.  I will not make up excuses.  It’s just the way it’s been for me.

Our son is remorseful for the mess ever to be created and, of course, wishes he never implicated his dad and hopes that something can happen to where I am not involved.  He wants it to be all on him. Honestly, if I had the money, I would pay off all of his and our daughter’s loans.  But it just isn’t possible.

So the big question, again, is what can I do concerning my situation in this (if anything) and how do I go about doing it?

Thank you for reading all this.

Ted

Ted,

I’m afraid I can’t advise you about your particular circumstances but I want to point you to some additional information. 

Most private student loans do not have the same death and disability discharge provisions that federal student loans do.  Private lenders can sue in court and if they get a judgment, can enforce the judgement according to state and federal law.  Even if the private lender gets a judgment, the judgment allows your creditors to use special collection tools to try to collect. But the effectiveness of these tools depends on how much income and property you have and on the type of income and property. Certain types and amount of property, income, and assets are protected by federal and state law from seizure.

They cannot get what you do not have, right?  You may want to consult with a consumer lawyer in your area. I’m a member of the National Association of Consumer Advocates and they are the place to look: http://www.naca.net

Best,
Heather