This person should seek advice from an attorney on their own, rather than through an intermediary. They would likely be told that there is no statute of limitations on student loans and that, once a creditor obtains a court judgment, all non-exempt assets are potentially available to satisfy the judgment.
STUDENT LOANS AND SENIOR CITIZEN
The simple answer is yes. The fact that you are a senior citizen is not relevant if you have defaulted. There are some things you can do to protect yourself, so consult an attorney in your area with expertise in Student Loans.
The bottom line is that a delinquent student loan is like any other loan. In the event of delinquency, the lender has the legal right to seek a judgment in a court of competent jurisdiction and then to enforce it through seizure of the judgment-debtor's assets, whether through garnishment of salaries, or seizure of property such as automobiles, bank accounts, and real estate. In some states, such as New York, a monetary judgment results in an automatic lien against the judgment -debtor's real estate. I always tell clients it is a huge mistake to ignore collection notices and lawsuits because they will ripen into judgments judgments are much more difficult to deal with than a creditor who may be willing to take some good faith payments, even if far below the amount owed. If you find yourself subject to a judgement, you should retain an attorney without delay to review what your alternatives may be. There may be ways to vacate certain judgments, but the bottom line is: yes, your student loan, if left unpaid, could result in a judgment against you. There is no statute of limitation on student loans.
Any person that defaults on a student loan is subject to collection on that loan. Usually, there is no statute of limitations on student loans, so it will not matter how long it has been since the student defaulted on the loan.
That said, the Student Loan provider cannot just seize your bank account or house. In most states, a creditor must first commence a lawsuit against a debtor, and then obtain a Judgment by the Court, before the creditor can seize assets. In New York State, the Judgment acts as an automatic lien on your real estate, but the creditor must still commence an additional action if it actually wants to take the house.
Finally, there are many ways to fight these actions and judgments, and in Bankruptcy Court, there may be options to void the loans if the senior citizen is incapacitated from working and repaying the loan.
I suggest you consult with an attorney in your jurisdiction.
Law Offices of Allen A. Kolber, Esq.
Please see my website for further articles and FAQs regarding Chapter 7 and Chapter 13 Bankruptcy cases.
This response and the related links are purely a public resource of general information and is not intended to be nor is it a source of legal advice. This information is generalized and should not be relied upon as legal advice. You should consult an attorney for advice regarding your specific situation. This communication does not create an attorney-client relationship.
The answer is that generally yes. On a student loan delinquency/default that results in a judgment a bank account can be frozen, depending of course on the jurisdiction and jurisdictional limits. In addition, if the student loan is government backed, then there are other immediate remedies like the loss of income tax refund monies and a bank account may be able to be frozen without litigation. You would have to look at the loan documents to confirm the default terms and specifically the default remedies for the lender. You might call the lender or servicer of the loan and ask about those terms if you do not have the paper work from the loan company. It would not matter that the guarantor of the loan is a senior citizen, what would matter is the type of funds located in the account in which the creditor tried to freeze. Certain funds are exempt from seizure, like social security and pension for example.
As for cancelation of the debt after 7 years, the question is not clear and even if you had not paid the debt in 7 years, if it’s a student loan debt, it does not “cancel” after any time. There is no limitation on the collection of student loans as a general rule.
Nothing in this shall be deemed legal advice in any way and is meant for general informational purposes only. No attorney client relationship has been established.