Articles Posted in Student loans

Published on:

By

Christie_1There are a few of us student loan attorneys around the nation that have dedicated a good portion of their lives and practice areas to understanding the student debt landscape and how to use it to our advantage to solve problems.  It shouldn’t be that complicated to repay a debt; but, alas it is.  The Department of Education has done more things over the past year than it has in the past 20 years to address student loan debt.  Because things have moved both rapidly and glacierly (if that isn’t a word, it should be), and various court filings have been all over the place, it’s hard to keep up with recent events.  And it takes time.

  • We get basic questions such as how do I know what loan types I have?
  • We also get questions on more complicated issues such as how can I best lower my payment while on an income driven plan – or what does double consolidation mean and how can it help lower payments on a Parent Plus loan?
Continue reading →
Published on:

By

Christie_1Pish posh on the 10k forgiveness the Supreme Court recently denied.  This is SO MUCH MORE IMPORTANT!  And a lawsuit was filed yesterday by the New Civil Liberties Alliance on behalf of the Mackinac Center for Public Policy and the Cato Institute in an effort to block it.  So take action now!!!  We are designating extra time over the next few weeks to make sure we are available to walk you through a consolidation and answer any questions you have.   This is expected to result in $39 billion in federal student loan forgiveness to more than 800,000 borrowers.  Don’t delay.  The litigants have already requested a temporary restraining order to put a hold on things.  I suspect that if someone gets a consolidation application in (online can take five minutes) before a TRO order is entered, they would still be counted for forgiveness (but that’s above my paygrade so we don’t really know).  Forgiveness that occurs under the recount will also be tax free as it will occur before the end of 2025.

IDR one time account adjustment:

For many years, student loan servicers steered struggling borrowers into forbearance instead of guiding them toward income driven repayment.  Income driven payment generally caps payments at no more than 10 percent of income, and ultimately leads to loan forgiveness after 20 or 25 years of repayment.  Many of these loan servicers also failed to accurately track borrowers’ progress toward forgiveness.  Some of these companies had no system for tracking payments and identifying when borrowers would qualify for forgiveness.

Continue reading →
Published on:

By

arkovich_law-narrowThe Navient settlement today reflects a broad shift in the understanding of higher education debts that can be summarily discharged in bankruptcy.

The case is Homaidan v. Sallie Mae Inc., Bankr. E.D.N.Y., No. 17-01085, motion filed 7/21/23.

If you are considering bankruptcy to fix your finances, make sure to get your student loans taken care of also.  We do both, and if you’d like to set up a strategy session to discuss your specific situation (credit card debt, house, student loans, income and assets) and understand your options (and you’re in the Tampa area or its surrounding counties), please see the link below.  We freely discuss any options you can take advantage of if bankruptcy is not a good option as well.

Continue reading →
Published on:

By

arkovich_law-narrowParent 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) to provide that the Department will award credit toward IDR forgiveness for months where the Secretary determines that the borrower made payments under an approved bankruptcy plan.

While there is a process for this to occur now it is not widely understood and rarely used.  In most cases, borrowers owe more in federal student loans when they exit bankruptcy than what they owed before filing.  There is no reason why borrowers should not receive IDR credit towards their student loans during a Chapter 13 bankruptcy which often is five years.  This has been a big bone of contention of ours for several years.  Depending upon how the new change will be applied (the regs aren’t out yet), debtors should be able to obtain IDR credit while making a court approved payment plan which could be substantially lower than the normal IDR payment amount outside of bankruptcy.  This may be the only recourse available to those with Parent Plus loans who don’t or can’t double consolidate their loans in time to avoid ICR.  It may also be the only way to address a high payment for those with grad loans who have high medical, housing or family expenses and are stuck with an unaffordable IDR payment even under SAVE.  It will be particularly good for those in the next 12 months who won’t see the SAVE payment reductions until July 2024.

Continue reading →
Published on:

By

arkovich_law-narrowWe 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 coming back after her arguing that during the bankruptcy, interest continued to accrue, and now she owes $3,700 in interest. In the Chapter 13 Trustee’s Final Account they paid the POC principal PLUS interest.

Continue reading →
Published on:

By

Christie_1We’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.

There are some things that will be coming out due to this decision that everyone should be aware of:

  • Servicers are being instructed to provide borrowers a 3-month “grace” or “safety net” period during which borrowers will not be treated as delinquent if they miss payments (though interest will continue to accrue). That 3-month period may be extended.
Continue reading →
Published on:

By

Christie_1We’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 the three-year income monitoring requirement that too often caused borrowers to lose their discharges solely because they failed to respond to paperwork requests.

Continue reading →
Published on:

By

Christie_1I 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 steps to separate their loans will receive the benefit of the one-time IDR account adjustment, even if the application does not become available until after the adjustment occurs in 2024. The adjustment will be applied retroactively for both borrowers when both applied to separate their joint consolidation loan. For separate applications, the remaining co-borrower who did not apply to separate the joint debt will not receive this benefit until and unless the borrower applies to consolidate the remaining loan into a Direct Consolidation Loan.

You must notify the ED Ombudsman Group of your intent to apply for separation of your joint consolidation loan by contacting ED’s Office of Federal Student Aid (FSA) at:

Continue reading →
Published on:

By

cramdown-picWe 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 also have a copy added to our home page of our website.  Here is the Spring Sidebar:

https://www.christiearkovich.com/files/student-loan-summer-2023.pdf

Published on:

By

arkovich_law-narrow“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 be appealed by either the Department of Education, or ECMC (guarantor litigator for the older FFEL loans).  Now it’s different.

In an opinion just out on April 5 (Love v U.S. Dep’t of Education, Fedloan Servicing, Nelnet; Adv. 21-02045-C), Judge Klein decried the “widespread belief that student loans are virtually impossible to discharge in bankruptcy.”  Now there is an attestation process, whereby a debtor can use factors like:

  • School closure
Continue reading →
Contact Information
1520 W Cleveland St
Tampa, FL 33606
Phone: (813) 258-2808
Fax: (813) 258-5911
The hiring of a lawyer is an important decision that should not be based solely upon advertisements. Before you decide, ask us to send you free written information about our qualifications and experience. This website is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of an attorney / client relationship.

We are a Debt Relief Agency under the United States Bankruptcy Code. We help people file for bankruptcy relief under the Bankruptcy Code.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Please do not include any confidential or sensitive information in a contact form, text message, or voicemail. The contact form sends information by non-encrypted email, which is not secure. Submitting a contact form, sending a text message, making a phone call, or leaving a voicemail does not create an attorney-client relationship.

Copyright © 2015 – 2025, Arkovich Law
JUSTIA Law Firm Blog Design