The borrower used the money for renovating the house and didn't go to school. Will I win in court if I sue the person?
2007-06-24 15:15:32 · 7 answers · asked by chrissykaduka 2 in Business & Finance ➔ Credit
YES YES YES!
2007-06-24 15:19:43 · answer #1 · answered by Anonymous · 1⤊ 1⤋
Probably not. The person may get their "just desserts", though, depending on the actual type of loan they received.
A student loan through the government goes directly to the institution the student specifies on their application; there's paperwork involved on both ends before the money is advanced. It doesn't sound like the borrower got this kind of loan, though...
If the loan was through a BANK and was intended to send the borrower to school, then you might be able to dip the borrower into a little hot water. Speak to the bank, and let them know what the borrower did with the money. Many financial institutions offer student loans at reduced rates with special repayment options, and won't be very happy to find out that they were duped out of interest revenue by someone who didn't go to school. They may demand the loan, or jack up the interest rate and change the repayment options. They may also take the borrower to court, depending on the size of the loan. I'm almost certain that's classifed as financial fraud, or misrepresentation, or something like that...
You, however, really don't have a leg to stand on. All you did was guarantee the loan. I'd be extra sure, however, before I did anything, that you won't be on the hook for anything if the loan is demanded and the borrower suddenly cannot pay; you don't want to screw yourself over! You may be able to convince the bank that you, too, were taken in, and they may decide to release you from your guarantee. Talk to a lawyer, or talk to the bank, and decide from there what to do.
2007-06-25 00:53:26 · answer #2 · answered by jeffs_wife_ali _&_adams_mom 2 · 0⤊ 0⤋
NO ! NO ! NO ! If your only interest in this transaction was to guarantee the loan via your signature, that is all you did, and have no legal basis upon which to sue. In order for you to have any legal basis against this person, the contract would have had to contain legal language covering that fact. If all you did was co-sign as a guarantor, you are out in the cold here. However, depending on the nature of the loan, the LENDER may have action against the borrower if the loan specifically covered use of the funds.
As usual, check the fine black and white print.
2007-06-24 22:24:05 · answer #3 · answered by acermill 7 · 2⤊ 0⤋
If you have enough evidence. Of course you can sue them. The government offers a low rate for students to go to school, not to remodel their houses. That's illegal. I think you should sue them since your name is attached to the loan. They can ruin your credit. The government allows the borrower to pay back student loan in 10 years.
My student loan goes straight to the school. If they grant me too much money, the school then will send it to me. When I found out, I told them to send back to the lender. I don't need money to spend for other things beside school and books.
Lesson learned. Never co-sign a loan with anyone.I don't think you are cold if you sue the borrower. Student loan is for students, the money uses for tuition and books. That's why they call student loan. Otherwise, they should call home improvement loan and the rate would be much higher. To me, that's cheating and lying.
2007-06-25 00:39:06 · answer #4 · answered by Phoenix 3 · 0⤊ 1⤋
well if the loan was specifically a student loan, then by all means, sue sue sue!!! but if it was just a generic loan then you got nothing, the student loan must have some written documentation tho
2007-06-25 02:35:57 · answer #5 · answered by Starry Eyes 5 · 0⤊ 1⤋
Only if there was a written agreement that the money would be used exclusively for school or if the person fails to pay you back as agreed.
2007-06-24 22:20:58 · answer #6 · answered by Anonymous · 0⤊ 1⤋
NO unless you have a contract that stated exactly what the money was going to be used for! GOOD LUCK! :)
2007-06-24 22:23:11 · answer #7 · answered by Lil Shorty 4 · 0⤊ 0⤋