Attorney says I include student loans in means test

[dustinc]

My attorney says I can include my student loans in the means test, but I don't see where to put them. There is no place that I can see. Anyone know where they should go?

[backtoschool]

My attorney says I can include my student loans in the means test, but I don't see where to put them. There is no place that I can see. Anyone know where they should go?

They have to go under "special circumstances" and they are a real red flag to the trustee, especially if you are over the median income.

[justbroke]

Hopefully, you don't need the student loans in order to qualify for a Chapter 7. As backtoschool eludes to, including them, in order to receive a discharge, would require a special circumstance. It's pretty hard to rebut the presumption of abuse by declaring student loans as special circumstances.

However, follow your Attorney's lead as I'm sure they have a strategy. Perhaps it will work, perhaps not. The question for you is, if you don't have the student loans included, do you qualify for a Chapter 7?

[debtprison]

Given the response here I would ask your attorney to confirm this because you have had others suggest this might be a potential problem. I'm not saying not to listen to him but I would respectfully ask him to research and be sure of this.

Ethically I think they SHOULD be included since there is no way to avoid paying them and they are a government debt like taxes however unfortunately law is not always equal to ethics.

[dustinc]

I don't qualify without the student loans. I'm kind of nervous about this. I hope my attorney isn't confusing being able to use them in the means test vs. using them as an expense in my budget. My attorney doesn't have much experience with the means test as most of his clients have more non consumer debt so they don't have to take it. I don't see "special circumstances" on the means test anywhere. Where is this? Also, section 32 says "telecommunication services". Is this for internet only?

[backtoschool]

I don't qualify without the student loans. I'm kind of nervous about this. I hope my attorney isn't confusing being able to use them in the means test vs. using them as an expense in my budget. My attorney doesn't have much experience with the means test as most of his clients have more non consumer debt so they don't have to take it. I don't see "special circumstances" on the means test anywhere. Where is this? Also, section 32 says "telecommunication services". Is this for internet only?

I would definitely consult with at least one more attorney before you file. Using student loans as a "special circumstance" to get a chap 7 discharge could end up getting the US Trustee involved in your case. Read an example here:

http://www.bkforum.com/showthread.php?t=40422

[dustinc]

I've read posts in this forum and some say that it varies by district on whether you can include student loans in the means test. I have the ability to reduce my income so if I have to I can do that in order to pass. Anyone ever used them on the means test without a problem? I've researched, but haven't found any law on whether student loans are allowed. Anyone know of any case law on this? Also, section 32 says "telecommunication services". Is this for internet only? Thanks for the advice.

[dustinc]

Please click on this link and do a search for "student loans" and let me know what you think.

http://www.bna.com/webwatch/bankruptcycrs.pdf

[sjcmCA]

So far I met four attorneys!

Three attorneys confirmed that I can put the student loans in the mean test because it's not dischargable.

Only one attorney who pushed me to file Chapter 13 right now(!) said it can't be included in the means test. I am not saying this advisor (yes, this attorney was just a advisor) was wrong, but she was greedy. That's what I felt from the consultation.

If there are some folks who shares their experiences would be helpful but I don't see those yet. I saw some threads from this forum that some could put SLs but some couldn't. Weird...

I am living in California - Central Valley area.

I will share my experience on SLs in the future. I promise!

[ProjMgrNewb]

In my prev Chp 7 filing, my former attorney included my gov't backed student loans as a priority debt. This is what had me as passing the means test for a Chp 7. This was a red flag to the US Trustee immediately -- I'm in the Southern District of Ohio, 6th Circuit (i think).

The rationale is that the student loans will go into an administrative forbearance when you file bankruptcy therefore no payment is due. Whatever you would have been paying on student loans can now be freed up and paid to your other creditors and thus puts you in a 13.

The only way around this is if your expenses are high enough without the student loans, to get you to pass the means test and reflect in your budget.

Only in SEVERE circumstances can a student loan be included in the means test, i've never heard of one though. And, unless there has been some life altering change (disability for example) you can forget about them ever being discharged. And again, this is my experience with gov't backed loans, private loans may be different.

As many others have stated, this depends on your state, district, etc.... your mileage may vary.

[2manybills]

Yes, we've seen people in this forum where the UST allows SL's and where they don't in the same district. I think it depends on how much $$ and other factors.

[liz417]

When I was about to file a ch 13 bk last year, my student loans were going to be put on "hold" for the next 5 years. Now, after much research and "shopping around" for the best attorney, I am able to include my SL payments (about $350 per month) in my schedules, which helped my qualify for a ch 7

There are a couple of other posters in Calif who were NOT able to claim their SL payments, I guess it just depends on the Trustee (or UST).

[2manybills]

When I was about to file a ch 13 bk last year, my student loans were going to be put on "hold" for the next 5 years. Now, after much research and "shopping around" for the best attorney, I am able to include my SL payments (about $350 per month) in my schedules, which helped my qualify for a ch 7

There are a couple of other posters in Calif who were NOT able to claim their SL payments, I guess it just depends on the Trustee (or UST).

There are people on this forum in your district that are having problems. You have to wonder if it is because they were pro se or not.

[liz417]

There are people on this forum in your district that are having problems. You have to wonder if it is because they were pro se or not.

Yeah, I've spoken to them via PM. I really don't know what the "hold up" is in their case I wonder if it was because they are ProSe...I don't know. With the attorney I have now, I choose him (over another really good attorney) because he has a good relationship with all the trustees (he's been doing strictly BK for over 25 years) in the Riverside/San Bernardino area and he knows what will "fly by" the Trustees. At my 341, I watched as the Trustee was a no-nosense-kind-of-guy, postponed one case after another, when my attorney walked up, they were joking and laughing and all "his cases" (he files once a month to have all the same 341 date(s)) went off without a hitch....so, I don't know

[2manybills]

I know in OC it really mattered if your attorney was prepared, knew their way around the courthouse, etc. especially if you are over median, special circumstances, etc.