Heard this sad story from a US-returned friend through this club I have joined. If you have any legal advice, pls help Shakit, your fellow Nepali mate. I want to keep his name and other identifications anonymous, but pls this is a true story. Background Info: Call him Shakti (name changed), 27 years old. Shakti did his undergraduate schooling in the American midwest from a four-year liberal arts college - where he took out USD 3000 per year as student loans against a promisory note which he had to sign at the beginning of each year. The rest of his costs were in the form of scholarship, except for that loan part. He graduated in 1999...didn't work in USA, and returned to Nepal, by which time he owed the college USD 12,000, with an 8% interest rate. Now the loan has ballooned owing to compounded interest rates. He's from a lower middle class family, and with average Nepali salary (NRs 15,000/month) he is unable to back all those loans. And this is where his worry starts. He posed me the following questions, to which I have no straight answers. If you can help him ease his mind, pls answer the following so that I can forward this to him. Key questions: 1) When Shakti applied for financial aid, he had to declare his family assets, and the form was signed by his father. His home address is also on the form...which means he is still traceable. When he signed the promisory note to take student loans, he was already an adult, and for the best of his knowledge the promisory note was not signed with his family assets as collateral. Besides, since he doesn't own those family assets (his parents own them), he can't put them as collateral. It was probably signed with the understanding that he would eventually pay back the loan from his own earnings - but with his salaries in Nepal (NRs 12,000/month) that is not possible. He has only saved up to six lakhs till now - less than the outstanding loans. Now the question is: can the loan collection agency based in US (assuming that the College sold his debt to the agency) come after his family assets? His father's signature is not on the promisory note - but only on the financial aid form. His family assets are under his parents' name - basically some land and house - and he has four other siblings who will some day inherit those. Can the loan collection agency claim the family assets - even though they are not under Shakti's name and the promisory note was not signed against the family assets as collaterall? More importantly, can the loan collection agency through their contact with local bank in Nepal penalise his parents (who own the assets), and his siblings (who will divvy up the assets as inheritance pies) for the fault (default) that is solely his doing????? His parents do not work - but live off the rent by renting their only house. They are old, and may be rendered homeless and incomeless in their old age. 2) Although based in Nepal, can he file personal bankruptcy in the US or Nepal so as to keep the wolves at bay? Would declaring bankruptcy save his family assets? If so, what would be the procedures? 3) If the collection agency sells the debt to a bank in his hometown - and the latter decides to foreclose on his parents' home, can they legally do it? 4) Has any US-or-West-returned Nepali student had this problem or how has he or she dealt with it? The reality is if you take out loans, and do not decide to work in USA, it is almost impossible (like running to stand still or going a little backward) to pay back the loans. As this could happen, has it happened? 5) Can you recommend any American-Nepali lawyers based in USA or good trustworthy Nepali lawyers based in Kathmandu that he can consult? 6) Do colleges grant debt-forgiveness? Shakti today is going through tough times - this is affecting his social life, professional life, and everything. What would be the best course for Shakti to follow - to protect his parents' property, which is not legally his yet? Helping him a bit in my own way as a Good Samaritan. This could affect any Nepali students studying in USA on student loans, so I thought this was the best place to post the above queries. Thanks, Karmapa ----------- Pls post your responses in this thread and I will share these with him. I am not a legal pundit - and when it comes to legal matters, I'm zero, zilch.