Maryland Student Loan Defenses: 8 Ways to Fight Back

Being sued for a private student loan in Maryland doesn’t mean the lender automatically wins. State law gives you defenses that can reduce — or even wipe out — what you owe.

The most common defenses include:

• Arguing the lender can’t prove they actually own your loan.

• Using Maryland’s three-year statute of limitations to show the debt is too old to collect.

• Pointing out errors in the balance or mistakes by loan servicers and debt collectors.

One of the strongest defenses is to question whether the company suing you actually owns your loan. In legal terms, this is called “standing.”

Original lenders like Sallie Mae usually have the paperwork to prove ownership. But when a loan has been sold or transferred multiple times, debt buyers don’t always have a complete record. If they can’t show the full transfer history — including signed documents with your loan details — you can argue the case should be dismissed.

Related: Chain of Custody for Student Loans

Maryland has a three-year statute of limitations for private student loans. If more than three years have passed since your loan went into default — or since the lender accelerated the loan — the debt may be too old to collect.

But here’s the key: the judge won’t dismiss the case on their own. You have to raise the statute of limitations as a defense in your court response. If you don’t, the lender can still win.

Related: Maryland Student Loan Statute of Limitations

Another defense is to challenge the amount the lender says you owe. Errors are common — payments get misapplied, fees are added that shouldn’t be, or interest is calculated incorrectly.

You can request a detailed account statement showing your original loan amount, all interest charges, fees, and payments. Compare it against your own records. If you spot payments missing or charges that don’t add up, point out those errors in court to dispute the lender’s claim.

Servicing mistakes can also be a defense. In some cases, loans are pushed into default because payments were misapplied or accounts were mishandled — even when you’ve been paying.

If your payment history shows the servicer made an error, you can argue the loan should never have been in default and ask the court to dismiss the case.

Debt collectors must follow strict rules under the Fair Debt Collection Practices Act (FDCPA). They can’t harass you, threaten you, or sue on debt that’s too old. They also have to provide proof of the amount you owe and name the original creditor.

If a collector breaks these rules — for example, by failing to validate the debt when asked — you can raise that violation in court and argue they don’t have the right to sue.

If the loan isn’t really yours — for example, if it was taken out through identity theft — you can use that as a defense. Courts require lenders to verify a debt’s legitimacy, and if you prove it was the result of fraud, the case can be dismissed.

Evidence matters here. Filing a police report and submitting documents like an FTC Identity Theft Report or proof of forged signatures can show the loan doesn’t belong to you.

If your loan has already been discharged or forgiven, the lender can’t collect on it — and that’s a strong defense. Discharges can happen because of disability, school closure, fraud, or in rare cases through bankruptcy under the “undue hardship” standard.

Check whether your loan qualifies for discharge under federal programs, or talk to a bankruptcy attorney if you believe your private loan might meet the hardship test. If you can show the debt was already wiped out, the lawsuit should not move forward.

Related: Maryland Student Loan Forgiveness Programs

If you’ve already settled the debt and the creditor accepted a payment as “payment in full,” that can be a complete defense. Once a loan is settled, it can’t legally be collected again.

Keep records of any settlement agreements, cashed checks, or written confirmations. If the lender tries to collect after accepting a settlement, you can show that evidence in court and argue the case should be dismissed.

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