Private loans missing from credit report... Can I assume it's dissappeared?

I have an unusual story about disappearing private debt.

I used to have about private student loans via Sallie Mae. Sallie Mae switched to Navient, and then I refinanced a couple of times, and my debt was eventually held by WSFS Bank, through LendKey.

In late 2019, while under-employed, earning little, and struggling to make payments, WSFS suddenly wrote off my debt. So, I called them to find out what happened to my debt. I remember them giving me the number of some entity who they say held it, but I have since lost the number and now I have no idea who owns the debt. I haven’t even seen it on my credit report for the last year.

Last I checked, the balance was over $60K, but I have no idea what it is now, whether it is accruing interest, or how to monitor it, or make payments. I emailed WSFS about it a couple of weeks ago and they replied saying they have no record of my debt or who currently holds it because they purge those records after 3 months of writing off an account.

So, my question is, where is my debt and does it even exist anymore? Since my private loan balance is missing from my credit report and the paper trail is effectively lost, can I fairly assume that this debt is gone? And if some creditor or collector comes after me out of the blue one of these days laying claim to the debt, can I fight them and win?

Hi there. I think it’s too soon to assume it doesn’t exist anymore. These things can pop back up. Hopefully in this case it got lost in the shuffle of selling it on the secondary market and won’t come back. It happens. There’s just no way to know for sure until more time passes. You might want to contact an attorney to see how much time needs to pass. Statutes of limitations vary by state. So it doesn’t show as a charge off or anything on your credit? If so, that’s great!

Since we’re not attorneys here we can’t really tell you if you could fight them and win. If they do attempt to collect, we can refer you to legal services in your area to fight them and maybe reach some kind of settlement if nothing else.

Hi Lee Ann,

Thanks, I really appreciate your response! Yeah, on my credit report it just says the account is closed. Hopefully that holds true!

I will consider contacting an attorney for advice. Do you know of any organizations that offer free or low-cost access to attorneys for situations like this, by chance?

Thanks again,

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Hi Patrick,

Keeping our collective fingers crossed for you! I would google low cost legal aid in whatever area you are located. I don’t have a specific org I can refer you to. You may be able to get a free consultation though.

That’s what I figured, but thought I’d ask anyway. Great, I’ll look into this. Thanks again for the help!

Hi @loftus91,

I would be interested to read the email that WSFS sent to you saying they have no record of your debt. Could you forward it to me?

@LeeAnn is right, just because this debt isn’t listed on your credit report doesn’t mean it isn’t still out there or legally enforceable. All it means is that the creditor has not made a report to the credit rating agencies about it.

If WSFS charged off your debt in late 2019, then that would start the statute of limitations (SOL). There are different SOL for different states, but six years is pretty common. The SOL is the amount of time the creditor has to seek a judgement against you for payment of this debt.

If you do get sued, so up to court and challenge the debt! That is the #1 thing you have to do is SHOW UP. If you don’t show up, the court will just make a default judgement on behalf of the creditor.

If you do start getting calls from collectors about this debt, know that you have significant leverage to negotiate a settlement. If WSFS sold your debt to someone else, they likely sold it for pennies on the dollar. You can offer to settle for pennies on the dollar. So if the debt is about $60,000, you could start the settlement negotiations at around $3,000. You might have to settle for higher, but start at $3,000 which would still make a profit for the person who bought your debt. But if you do get a settlement, make sure to get it in writing, and make sure it includes removing any negative trade-lines on your credit reports (assuming they ever do make a report).

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Thanks, Thomas. Just DM’ed you. I can forward you the email.

According to this source, the SOL in Maine (where I live) is 6 years. So, looks like I’m not out of the woods for another 4 years. Since I just moved here from Massachsetts, where I took out the loans, does that change anything?

Great to know I might have more leverage than I thought, though! I really appreciate your insight into the legal process—I’ll definitely keep all of that in mind if they threaten to sue.

It can be difficult to tell which state’s SOL applies in each given case. Sometimes it is the state that the loan originated in, even if you lived in a different state or attended school in a different state. I don’t really feel confident in determining which state’s SOL is the right one to use here. But six years is quite common in many states, so it is my rough-and-ready rule of thumb when trying to size up situations like this one.