Parent Plus loan borrowers and grad loan borrowers have received the short stick for all the recent announcements post the Supreme Court decision on student loan forgiveness. The new bankruptcy rule will allow debtors to create a Chapter 13 Plan to easily provide IDR credit: Changes: We have revised §685.209(k)(4)(iv)(K)…
We received this inquiry today from a fellow bankruptcy attorney: I have a client who had a Chapter 13, which due to it being a 100% plan, ended off paying off the Proof of Claim Amount at 100% in the bankruptcy. Years later, (Insert Private Student Loan Company Here) is…
We’ve just learned that the U.S. Supreme court denied the 10k-20k forgiveness of federal student debt that was pending. We were expecting that. Unfortunately, most of our clients owe so much more anyway, and the other programs out there are doing so much more to get rid of this debt.…
We’ve seen some confusion out there about whether those with disability discharges for federal student loans are required to provide income information going forward. This is because the new rule hasn’t yet gone into effect. But it will before the repayment pause ends so no worries. https://www.ed.gov/news/press-releases/education-department-releases-final-regulations-expand-and-improve-targeted-debt-relief-programs The rule eliminates…
I just became aware of a new procedure to provide “an intent to separate a joint consolidation loan” when a client received this: As you are already aware, you and XX have a FFEL Joint Consolidation Loan. ED has indicated that FFEL Joint Consolidation Loan borrowers who take the necessary…
We write a column – that has become 1-2 pages due to all the stuff going on — called the Student Loan Sidebar in our local Cramdown publication to all bankruptcy practitioners including debtor attorneys, the creditors’ bar and our judiciary. Because not everyone has access to this publication, we…
“It is now time”, states Judge Klein who is charting a path for discharging student loans without being reversed. For years, bankruptcy judges were wary of ruling in favor of debtors who asked for a discharge of federal student loan debt. In part, because those Judges knew their rulings would…
By now everyone (our attorney friends) has probably watched a CLE on the new DOJ Guidance to discharge federal student loans, but do you really understand how to do the process? We are on a panel set up by the Bransons in Orlando doing an all-day workshop via Zoom on…
One of the early and frequent arguments made by opposing counsel in our private student loan discharge adversaries in bankruptcy is that the student loans were made for an educational benefit and thus are excluded from discharge. Specifically, Section 523(a)(A)(ii) exempts from discharge “an obligation to repay funds received as…
Some of you may have heard that the May 1 deadline to consolidate older FFEL federal student loans to the newer Direct student loans for the one time account adjustment has just been extended until the end of the year. While that initially seems like great news, why is it…