Legal Question in Credit and Debt Law in Pennsylvania

I don't handle many student loans, but there may have been a change in the law to treat private loans like federal loans at least as far as bankruptcy. Private student loans are no longer dischargeable.

You are generally correct that the statute of limitations is 4 years in PA and if the loan was taken out in PA and the default occurred in 2006, then the statute of limitations has expired. With federal loans there is no statute of limitations. Private loans, to my knowledge, would still be subject to the usual laws applicable to other credit card debt (medical bills, credit cards etc.) including the statute of limitations. The statute of limitations would thus appear t to have expired.

You are also correct about wage garnishment in general. It does not exist for most debts in PA where a judgment has been entered.

What I suggest is that you write to the collection agency and send them what I call a "drop dead" letter. In the letter, you can indicate that you believe the debt is legally uncollectible by reason of the expiration of the statute of limitations. I would be very cautious and be careful that you do not acknowledge that the debt is yours as you do not want to revive the statute of limitations. Needless to say, any partial payment would revive the statute of limitations, so do not pay them a dime. For these reasons, it would be better to pay a lawyer to write this letter for you. Having a lawyer do it also has the benefit that the debt collection agency cannot contact you once they know you are represented by an attorney under both the fair debt collection practices act and the PA equivalent of that called the fair credit extension uniformity act.

If you are sued, then you need to take the complaint immediately to a lawyer who specializes in defense of these types of actions. I know attorney Greg Artim (here at Law Guru) handles statewide defense of similar actions, although I am sure that there are plenty of attorneys who do likewise in your area.

The collection agency gets a commission on resolving debts. They will say and do just about anything to intimidate you into paying and giving up your bank account information. With a lot of people, the threat of a lawsuit or wage garnishment works. However, you do not seem to be intimidated. Which is good.