Justice Dept. hunts student loan recipients

Deadbeat graduates sued decades after college

April 14, 1999|By KNIGHT RIDDER/TRIBUNE

WASHINGTON -- Remember the student loan you got for college years ago and never paid back? Maybe you were poor or unemployed or negligent. And maybe you thought the U.S. government had forgotten about you.

No way.

In every part of the nation, the Justice Department is pushing record numbers of deadbeat grads into federal courts in a last-ditch effort to collect on at least some of the billions of dollars in defaulted student loans, some of which originated in the 1970s.

It doesn't matter how old the loans are. There is no legal deadline for filing such judicial action. Not any more. Several years ago Congress eliminated the legal time limit, which had been six years.

"The cases can be 25 years old or more when we get them," said a Justice Department official, who insisted on anonymity. "These are debts that often can be paid. Many of these people believe that nobody cares and that they'll get away with it. We're here to prove that's just not true."

Over the past two years, the Justice Department has shunted more than 54,500 cases, involving loans totaling almost $230 million, to U.S. attorneys and private lawyers who are authorized to sue.

More than 14,000 federal student loan suits were filed in 1998, a leap of almost 55 percent from the previous year, according to the Administrative Office of the U.S. Courts; 409 of those cases were filed in Maryland.

As college costs mount and loan eligibility requirements ease, students are borrowing more money than ever and are deeper in debt when they graduate.

In 1998, nearly 6 million students borrowed $38 billion, almost four times the amount borrowed a decade earlier.

The average borrower at a public university graduated with nearly a $12,000 debt in 1996 -- up more than 20 percent from the average of $10,000 in 1993.

Thomas Pestka, deputy director of the U.S. Department of Education's debt collection section, wants debtors to know that the government has a heart -- even for delinquent borrowers.

"For instance, if they have no job, the government will defer all payments for up to three years until they get a job, did you know that?" he said.

Pub Date: 4/14/99

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