Student Loans

Student Loan Debt Received Priority Treatment – Chapter 13

March 27, 2017

Background:

  • A Chapter 13 Plan proposed to pay student loan debt ahead of other general unsecured creditors.
  • Trustee objected to the payment priority proposal with the premise that the student loans were being given favored treatment of student loans and was unfair discrimination.
  • Debtor proposed to pay nearly $5,000 per month through the plan and treated two student loan claims which totaled $65,000 with a separate class.

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Discharging of Student Loans – 46 yr. old Pilot – Denied

plane-crashingDischarging of Student Loans – 46 year old Pilot – Denied

I have covered before the Brunner test, to determine if you can meet the undue hardship requirement for student loan discharge.   Here we have a case wherein a pilot is seeking the court to discharge his student loans. Continue reading…

Discharging of Student Loans – Brunner Test: Undue Hardship

October 30, 2016

Student Loan CapSuccessfully getting student loans discharged in a Chapter 7 bankruptcy case is very difficult. For the most part, you must show that repayment would cause you “undue hardship.”   Most courts us a 3-factor test, called the Brunner test, to determine if you can meet the undue hardship requirement for student loan discharge.

What is the Brunner Test?

There are 3 factors or prongs that must be met: Continue reading…

Student Loan Debt Discharged in Bankruptcy for 63-year old

Student LoansOctober 23, 2016

As I have discussed in the past, student loan debt forgiveness (discharge) in Bankruptcy is taken on a case by case basis.

Facts:

  • 63 year old Chapter 7 Debtor was a cancer survivor.
  • $43,253 in Student Loans
  • U.S. Department of Education advised her to take advantage of the income-based repayment options to her (ICRP Program).
  • Debtor had been unemployed but was now looking for work.
  • Owned car and home but both needed significant repairs.
  • Debtor had not purchased new clothes in almost a year, did not have health insurance and had not purchased a significant appliance in over 10 years.
  • Debtor lived frugally.

Continue reading…

Debtor Tried to Discharge Student Loans – Court Denied; Debtor Ordered to Pay Attorney Fees

September Student Loans11, 2016

Discharging of student loans in general is taken on a case by case basis.  That being said, it is extremely difficult to discharge student loans.   Here is a case that when the Debtor lost in Bankruptcy Court, the Debtor even had to pay the Attorney Fees to the Defendant of $11,130.

Background

  • Debtor borrowed $149,197.00 to fund his education at St. George University School of Vet. Medicine in Granada.
  • Debtor asserted that the loans were made by a for-profit entity (non-gov. unit or nonprofit).
  • Debtor asserted  loans were not “qualified educ. loans”.

Continue reading…

Student Loan Debt Discharged in Bankruptcy for Failed Lawyer


Student Loan DebtFebruary 24, 2016

As I have discussed in the past, student loan debt forgiveness (discharge) in Bankruptcy is taken on a case by case basis.

An attorney with an MBA was able to discharge $264,000 in student loan debt since the Court decided that the debtor’s “dismal circumstances will persist.”
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Discover Bank to Refund $16 Million & pay $2.5 Million Penalties – Student Loans Collection Practices

August 30, 2015

The Consumer Financial ProteDiscoverction Bureau (CFPB) carries a big stick.  CFPB told Discover Financial Services’ banking unit to pay $16 million in refunds to more than 100,000 borrowers and $2.5 million in penalties.

What happened? Continue reading…

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