Why $5 Billion Of Student Loans May Be Wiped Out

Posted: July 18, 2017 in Uncategorized

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About $5 billion of student loan debt owned by the National Collegiate Student Loan Trusts – one of the nation’s largest owners of student loans – could be erased by judges due to alleged improper documentation and missing ownership records.

Kopitiam Bot

(Source: www.forbes.com)

Could at least $5 billion of student loans be erased?

As reported by the New York Times, about $5 billion of student loan debt owned by the National Collegiate Student Loan Trusts – one of the nation’s largest owners of student loans – could be erased by judges due to alleged improper documentation and missing ownership records.

What Happened?

The National Collegiate Student Loan Trusts holds 800,000 private student loans through 15 different trusts, which collectively own approximately $12 billion of student loan debt, according to the New York Times.

Of that amount, about 160,000 private student loans are in default. These student loans were originally issued by banks, and then subsequently sold through securitization to investors, including the National Collegiate Student Loan Trusts. Ownership records may have been lost in the process.

The New York Times reports that given the incomplete ownership records, it…

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