Legal Question in Credit and Debt Law in Illinois

I co-signed for a student loan for my granddaughter at a time when I was in a position to pay the loan if she defaulted. She subsequently obtained at least one more loan but, I don't believe that I co-signed for a second loan and my granddaughter is in agreement with that. She became ill and had to drop out of school, therefore, the loan(s) became due and payable. I had an accident with injuries and was unable to work for awhile and, my granddaughter's illness became worse so that she's had to be on disability. I got a call a couple of days ago from a collection agency and, the person that I spoke to said that I was the co-signer on two loans and offered a payoff amounting to half of the current balance or, a payment plan with a downpayment and monthly payments on the full balance. I requested that she send me documentation that I had, in fact, cosigned for two loans and she responded that if she had to do that, the lender would begin litigation proceedings and the full amount of the loans would be due. I had been making monthly payments on the loan that I had co-signed for right after my granddaughter had to leave school and started getting late notices, despite having made payments. I called to clarify that they had received my checks and was told that my checks had been applied to another loan that I was not a co-signer on. After numerous communications, I told the lender that I would not make another payment until I could have some assurance that the account for which I was a co-signer would be credited and that the payments that I had already made be transferred to the correct account. I was never able to get any satisfaction.

I'm willing to pay what I'm obligated to pay but, obviously, I don't care to pay on a loan that I have not co-signed for and I can't understand why the lender or the collection agency is unwilling to provide documentation on these loans.

Can you please advise me if I should go ahead and accept the payment plan offered and assume that I am a co-signer on more than one loan or, should I stand firm, engage the services of an attorney and seek legal recourse.

Thank you for your prompt response.

1 Answer from Attorneys

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