In May of 1987, a student attending Temple University borrowed $750.00 through the University’s Federal Perkins Loan/National Direct Student Loan Program. The debtor ceased attending Temple in June of 1988.

Under the terms of the Perkins Note, the debtor was required to begin quarterly repayment on the Note at 5% simple interest beginning in December, 1988. The debtor failed to make any of the scheduled payments.

As with many independent institutions, Temple University had in place a policy wherein Temple would withhold the academic records of students who did not fulfill their financial obligations to the University. Consistent with that policy, Temple placed a hold on the debtor’s academic records. Consistent with its policy regarding late student loan payments, the University attempted to collect on the note. Failing in its efforts, the University then assigned the Note to a collection agency and then a collections law firm, all to no avail. Read the rest of this entry »