Over the past year, VPM News has been looking into a hidden type of debt affecting thousands of Virginia college students. It’s not federal student loans, which dominates most of the headlines. It’s money owed directly to institutions, called direct-to-school debt.
In our series Dreams Deferred , we’ve been exploring how this is creating hardships for students, making it difficult for them to complete their degrees and advance their careers. To start this series from the beginning, click here .
Maurice Donikin El enrolled in classes at Virginia Commonwealth University in 1999. Although he had partial scholarships to attend both Virginia Tech and the University of Richmond to play football, his doctor told him he shouldn’t play because of an ankle injury. He chose VCU because they didn’t have a football team.
“If I went to a school with a football team, I like football so much that I would have tried to walk on,” Donikin El said.
But he quickly changed his mind about VCU. He was unhappy with the classes his advisor helped him enroll in, and decided to transfer to Old Dominion University in Norfolk. ODU didn’t have a football team either, and it was nice to get a little farther away from his hometown of Cartersville.
But nearly two decades later in 2017, Donikin El found out that VCU was attempting to garnish his wages over a $1,569.50 financial aid check they say they sent him in August 1999 to help pay for his living expenses. (His Pell grant and other aid fully covered tuition and fees.)
Donikin El says he never received or cashed the check VCU claimed he owed. He says he was part of UVA’s Upward Bound program, and at the time was told by program staff that all of his financial aid dollars had been successfully transferred to ODU.
“Those were the people who helped me get into college in the first place…they helped me get my feet in the door,” Donikin El said.
Nobody ever mentioned an outstanding check from VCU. Donikin El says it’s possible that another family member cashed the check; before leaving for college, he was staying with his grandfather, who has since died.
“A $1,500 check comes in the mailbox... I'm not saying that nobody cashed it,” Donikin El said. But he’s certain: “I didn’t cash it, and I didn’t receive it.”
In 2017, Donikin El was working full-time at an Exxon gas station, earning $11 an hour for scrubbing toilets, stocking shelves and doing other maintenance work when his employer notified him about the garnishment. He was also getting up extra early and staying up late to study for his online classes, in pursuit of a legal studies degree.
“I was trying to feed myself…and trying to do school,” Donikin El said. “It was a grind.”
He was working hard to rebuild his life, even taking classes from the gas station parking lot on an extended work break on some occasions. He’d been released from prison a couple of years earlier after serving time for armed robbery, what he says was the result of a stupid mistake he made when he was young, hungry and hanging around with the wrong crowd.
VCU actually first took Donikin El to court over the $1,569.50 check in 2011, while he was in prison. Court records show his mom called the court to tell them he wouldn’t be able to attend his hearing. But years later, the school continued to pursue him over it. He’s one of thousands of students VCU has taken to court in an attempt to collect over the past several years.
“No time runs against the king”
VCU waited 12 years to take Donikin El to court over the tuition refund check and waited another six years to file a garnishment summons to seize a portion of his wages while working at the gas station after he was released from prison.
There’s no statute of limitations on debt to the Commonwealth of Virginia. That means there’s no limit on the number of years a state agency can wait before they take you to court over an alleged debt, unlike most other types of debt like credit card debt and medical debt.
This is in part because of an old English common law doctrine called “nullum tempus occurrit regi,” which literally means “no time runs against the King.” The doctrine still applies today in the majority of U.S. states, although some have taken steps to limit or completely outlaw its application.
“You’ve got to think about there being a king or a queen in England,” said Washington D.C.-based consumer attorney Travis Pittman. “If the king comes saying, you owe me money, you have no authority to say, ‘oh, no, you waited too long to ask me for my money so you can't have it.’ The king says, ‘oh, yes, I have a right to ask you for your money any day that you draw breath in my territory and my kingdom. I can demand that you pay me money.’”
In Virginia debt collection cases today, Pittman says, the state is treated as the monarch. As detailed in VPM’s recent series Dreams Deferred, Pittman successfully got a George Mason University student’s court fees reduced because the school and the state Office of the Attorney General, according to court documents, “sat on the claim for years without filing suit, and now demands over $3,500 in interest and $2,491 in fees. This is unjust and unethical.”
Many debt collection cases brought against Virginia State University students during the pandemic were over a decade old, and some students didn’t even know they owed money to the school in the first place. Some say they didn’t receive a collection letter sent by the school, and some say they hadn’t been informed that they could be on the hook for money to the school when they had to suddenly leave school years prior. One former student told VPM News she lost a government contract when an outstanding warrant in debt suddenly appeared on her background check for work.
Under former Attorney General Mark Herring’s office, 30% attorneys fees were tacked on to VSU cases. New Attorney General Jason Miyares recently announced that his office is cutting its attorney fees in half to 15%; he alluded to changes during an interview with VPM News in December. Miyares said he still has debt of his own from law school and said he’s very sympathetic to the issue.
“When you have those students, particularly lower-income, the last thing you need is to be paying legal bills on top of that,” Miyares said.
Miyares is also encouraging colleges and universities with their own fees to reduce their rates to match the 15%. His office is also amending its pre-litigation demand letter to expressly inform students in writing that they can contact the office to discuss payment plan options to avoid litigation.
Legislation targets “deadbeat creditors”
Most debt collection lawsuits take place in general district court, which aren’t considered “courts of record” in Virginia. There typically aren’t any transcripts or audio recordings made of these hearings, and courts are only required to keep general district court records for 10 years.
State law also only allows the enforcement of general district court judgments for 10 years after a judgment is granted. That means the state can only attempt to garnish a student’s wages for 10 years from the date the court judgment was granted unless the case is transferred to circuit court.
Until recently, courts were allowed to enforce a circuit court judgment – in the form of wage garnishment, or a lien on a home – for up to 20 years after the date of the initial judgment. Del. Carrie Coyner (R-Chesterfield) carried legislation last year changing that to 10 years because she says it’s often hard for people to get in touch with out-of-state “deadbeat creditors” to remove a home lien, which can then lead to devastating consequences.
“It's become very difficult to find creditors, and for a lot of folks, the sale of their home falls through and then they end up in short sales or foreclosure all over a credit card debt,” Coyner said in an interview with VPM last year.
Coyner says Virginia favors creditors over borrowers more than most states, “so the purpose of the bill was to shorten the length of time that a judgment lien was valid without renewing.”
The bill also requires creditors to include contact information — name, address and phone number — when they request an extension on a judgment.
“Because you should be able to, as a debtor, to easily locate the person or company that you owe money to, to pay it off and get rid of it,” Coyner said. “We are committed to coming back and doing some more work to ensure that homeowners and individuals don't have to go through such a hard court process if they cannot locate creditors in Virginia.”
Coyner’s legislative update allows creditors to request an administrative extension to enforce a judgment instead of appearing before a judge. Coyner says that was part of a compromise they made to get the bill passed.
The Virginia Poverty Law Center says while they were generally supportive of the legislation, they’re concerned the administrative renewal process will make it easier for creditors to extend the length of the lien, since they don’t have to go before a judge again.
This year, creditors are trying to get legislation passed that would allow them to significantly extend the amount of time they can enforce court judgments and liens. Proponents argued before lawmakers that the effort is merely a “technical cleanup” of Coyner’s bill last year, though the changes are much more substantial.
VPLC opposes the legislation. Christie Marra, director of housing advocacy for VPLC, told lawmakers last week that the bill would “takes us backwards…at least where we were two years ago, before the change made by Delegate Coyner’s bill.”
“This [Coyner's legislation] was designed in large part to deal with this huge problem that our clients face all the time of having debts that are purchased by these debt buyer companies, as they're known colloquially, who just wait until there's an opportunity to enforce that judgment through either a garnishment of wages – and usually, these are the only wages somebody has to live on – or through attaching the judgment to real property and enforcing a sale. And that really hurts people who inherit, and so it can actually cut off generational wealth,” Marra said.
Debts impede home ownership
In 2019, Donikin El was in the process of purchasing a home for his family when he says his realtor told him the sale couldn’t go through until he settled an old debt with the state. It was the VCU debt.
He’d tried to dispute the debt in court a couple of years prior but lost the case. Donikin El says he couldn’t afford an attorney, so he defended himself against an attorney from Herring’s office. He felt the deck was stacked against him from the start.
“I honestly think that they used my past record to slight my character because I had been to prison,” Donikin El said.
He wanted to appeal the court’s decision, but didn’t have the $138 necessary to file the paperwork.
VCU then attempted to garnish his wages for the second time. Donikin El set up a payment plan with the university in February 2018 because the debt was impacting his credit score. By the end of May 2019, he’d made over $600 in payments and another $353 had been withheld from his state tax refunds.
Donikin El wrote in an email to VCU on August 29, 2019, “I am proposing a payment of $950.00 in order to clear this debt. This is all the extra money that I have. I need to have a zero balance in order for me to have somewhere to live in September.” In an email to Donikin El the next day, James Stables, senior manager of VCU’s collection unit, wrote that he’d agree to a settlement of $992.
“I had to kind of eat some humble pie. Like, damn, I gotta pay these people this money I know I don’t owe them,” Donikin El said. “I had to kind of suck up my pride, call VCU and pay them the money so I could buy my house.”
Donikin El says he had to borrow some money from his family to come up with the total. Combined with the other payments he’d made and the amount withheld from his tax refunds, VCU received over $2,000 from Donikin El.
After purchasing his home, Donikin El replaced its flooring and put on a new roof. He’s thinking about moving eventually, because he spends three hours daily commuting to and from his job as a construction manager. Last year, he got licensed as a construction, health and safety technician.
While he’s grateful he was able to finish his degree, pursue a career and purchase a home, he worries that other students with direct-to-school debt may not be as fortunate.
“I think it's petty – especially to go after students – and really put that much energy into collecting,” Donikin El said.
