Can a private student loan company sue you or take your tax return?

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Can a private student loan company sue you or take your tax return?

My husband owes 14,000+ in private student loans. We’re concerned they might try to sue him or take his federal or state tax refund?

Asked on November 19, 2011 under Bankruptcy Law, Alabama

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

1) ANYONE you owe money to can sue you for it. A private student loan company suing you if you don't repay your loan is no different from a bank suing over a mortgage, a car company's financial arm suing over an unpaid car loan, or a credit card issuer suing you when you default.

2) Can they automatically take your husband's federal or state tax refund? Not if they are a purely private entity. But if they sue and win, they have a variety of tools to seek repayment, such as garnishing income, levying on a bank account, executing on property, or putting a lien on real estate.


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