Dear Madhesi, Thanks for your info. No Sakti is not a US permanent resident. Yes he was a foreign (interantional student) from Nepal. His tuition, board were mostly covered for 4 years by college in the form of scholarship, but as it was mostly partial scholarship (say upto 90% covered free of charge), he had to take out student loans (USD 3000/yr). This was given - do not ask me how. While the family assets were declared in the Financial Aid Form since the scholarship offered was needs-based and they needed that info to assess his scholarship needs, his father signed the Financial Aid form. However, for loans only Shakti signed the promissory note (promising to pay that amount after graduating) - and not his father or mother or guardian or anyone else. No mention of collateral was on the promissory note. Since the family assets are legally under Shakti's parents' name (not his), he couldn't have signed the promisory note against the family assets. I mean can Hari sign a promissory note against his uncle's assets, for instance? Even if he did say (playing the worst case scenario here), it would still need his father's co-signature, which isn't there in the promisory note. Which means it looks as if the college - or the loan collection agency to which the college has sold his debt - can only go after Shakti's property, which he doesn't have (he lives on rent, he has not bought property or house under his own name yet, as he is busy saving up money to do exactly that - but which he may instead end up servicing his debt, if the legality of it can be established. Also the wind is that the loan collection agency is illegal in Nepal - as we have different laws in Nepal. It is possible that the US-based loan collection agency may contact a bank in Shakti's hometown to foreclose on his parents' home (may be illegal given the above scenario) and other family assets. Apparently the US-based loan collection agency may strike some loan recovery deals with some bank in Shakti's hometown. This is possible to do in this day and age of ITCs and the Internet. Again my question is what should Shakti do to prevent his parents' home going on auction - the legality of it, in view of the scenario I above discussed above. Madeshi, like you, I would tend to think that the bank can go only after the borrower's property (Shaktis' property), not his parents' property (which in theory also belongs to Shakti's siblings potential inheritanc pies) and this he doesn't have, he only has savings in his bank account. Can the bank penalise the whole family (parents, siblings) for the wrongdoing of or defaulting by Shakti? Any legal counsel?