Daily Archives: October 16, 2014

Can Bankruptcy Help With Student Loan Debt?

I am stealing this topic from my friend Joshua Cohen  DETROITbankruptcyCOURT

and his the student loan lawyer website.

As I blogged on my student loan website today, even

the government assumes student loan debt will NOT be

discharged in bankruptcy, so they count student loan

debt as an asset on their books.

Everyone tells you you can’t, it is so hard, hardly ever do bankruptcy courts order student loan debt discharged.

Bankruptcy Chapters

Student loan debt is only dischargeable after you sue the student loan lender in bankruptcy court.

This separate lawsuit is called an adversary proceeding.

This suit can be filed in any bankruptcy case, Chapter 7, Chapter 13 or Chapter 11.

I have filed them in both Chapter 7 and Chapter 13 bankruptcy cases.

Chapter 13 and Chapter 11 are payment plan bankruptcy cases that last for years, so you have a lot of time in which to sue.

Chapter 7 cases usually take only 4 or 5 months.

However, Chapter 7 bankruptcy cases can be re-opened to file student loan discharge adversary proceedings, and I have done that as well, even years AFTER the cases were closed.

This depends on the judge; there is no right to have the case re-opened.

And, in my cases, it was based on the fact situation that existed when the bankruptcy case was filed.

That is, there was no loss of income or change in circumstances after the bankruptcy case closed, that caused us to re-open and file the student loan discharge suit.

What happened is, my clients got the small amount of money I was charging them to file the suits.

One client used the money we got from a student loan collector for violating the FDCPA, Fair Debt Collection Practices Act, to pay me.

In that case, we got a good settlement.  In the other, a complete discharge

As they say on TV, past performance is no guarantee of future results.

These cases are fact specific, to your health, age, income, and amount of student loan debt.

 

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