Statute of Limitations on Private Student Loans: State Guide

The statute of limitations on private student loans is the period when a lender or debt collector can legally sue you for unpaid debt.

Debt collection is one of the most common issues private student loan borrowers face. In fact, 12% of private student loan complaints involve debt collection, according to the Consumer Financial Protection Bureau’s (CFPB) 2023-24 Annual Student Loan Ombudsman Report. 

Knowing how the statute of limitations works and how it affects both you and your lender can help you make informed decisions if your loan is in collections. Here's what you need to know. 

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What is the statute of limitations on private student loans?

The statute of limitations refers to the period of time when a lender or debt collector can legally sue you for an unpaid private student loan. This time frame is set by state law, and it's typically measured in years. Each state determines its own limit for how long collectors can take legal action on private loans.

A lawsuit is one of several tactics a lender or collector may use to recover payment. If the court rules in their favor, they can take additional steps to collect the debt, such as garnishing your wages, placing a lien against your property, or freezing your bank account. 

Related: How To Get Your Student Loans Out of Collections

How long is the student loan statute of limitations?

The length of the statute of limitations depends on two factors: the type of contract tied to your debt and the state laws that govern it.

For private student loans, the statute of limitations typically ranges from three to 15 years, depending on the state. For example, the limit is six years in Arizona and 10 years in Illinois.

The clock usually starts on the date your first missed payment was due. For example, under Illinois law, if you missed your first payment on June 1, 2024, the statute of limitations would expire after June 1, 2034.

Federal student loans don’t have a statute of limitations. If you default, the government can continue collecting indefinitely through actions like wage garnishment or intercepting your tax refunds and federal benefit payments.

State-by-state statute of limitations on debt collection

Here are the statutes of limitations for each state:

What happens to student loans after the statute of limitations expires?

When a debt’s statute of limitations expires, the debt is considered “time-barred.” Under the Fair Debt Collection Practices Act (FDCPA) and Regulation F, debt collectors are prohibited from suing to collect a time-barred private student loan. They also can’t threaten legal action for a time-barred debt.

Even though collectors can’t sue you, you still owe the debt if it’s legitimately yours. Collectors can continue using other tactics to encourage voluntary repayment.

“A lender can still contact the indebted borrower via phone, or in writing, and can still report the debt to credit bureaus, which will negatively affect the consumer’s financial standing,” says Leslie H. Tayne, Esq., debt relief attorney and founder of Tayne Law Group in New York. 

“A lower credit score can lessen the consumer's borrowing power, making it more difficult for them to buy a home or vehicle, or even a future private loan,” Tayne adds.

Risks of resetting the statute of limitations on student loans

Once a private student loan becomes time-barred, certain actions can unintentionally restart the statute of limitations clock.

For example, if a debt collector emails you about an old debt and you respond in writing with something like, “Yes, I remember that debt. I couldn’t pay the student loan at the time because of XYZ,” your acknowledgment could reset the statute of limitations and reopen the window for the collector to sue you.

Consumer bankruptcy attorney L. Laban Levy says that in the state of Louisiana, the “prescriptive period” is five years, starting from the date the payment is due.

“In Louisiana, a written promise to pay, signing a new payment plan, or making even a small ‘good-faith’ payment can interrupt the prescription and restart the five-year period,” says Levy. 

“After prescription has accrued, a borrower may also unintentionally renounce it (waive it), often through settlement language. Borrowers should carefully review any agreement before signing,” he advises.

What to do if you’re being contacted about old student debt

If a debt collector contacts you about an old private student loan, avoid confirming verbally or in writing that the debt is yours. Any acknowledgment could restart the statute of limitations and reopen the collector’s right to sue.

The Fair Debt Collection Practices Act (FDCPA) requires debt collectors to provide validation information within five days of their first contact with you. This information must include:

• The debt collection company’s name and address
• The name of the creditor or lender owed the debt
• The amount owed, including itemized interest, fees, payments, and credits on record
• Steps you can take if you don’t believe the debt is yours
• Your rights regarding debt collection

Without confirming ownership of the debt, ask the collector for the date of the last payment on the account. This can help you determine whether the loan is time-barred.

Tayne also highlights the psychological burden that unpaid debt can have on consumers. 

“Even if time-barred, unpaid debt can negatively impact a consumer’s mental health,” she says. “This is especially true if lenders or collection agents repeatedly harass them. To avoid this, consumers should understand their rights and seek help from professionals, such as a student debt attorney.”

If you’re sued for a time-barred private student loan, don’t ignore it. Failing to respond or appear in court can result in a “default judgment,” which allows the collector to pursue stronger legal actions to recover payment.