Student Loans

[laurannm]

If you are in the middle of a Chapter 13 plan (5 years), are you allowed to take out a student loan, particularly loans that do not have get paid until after graduation?

Thanks

[One Half Full]

I'm doing a ch7 and wondering the same thing. You can't default on a student loan, but also I worry because I was told that after the FAFSA they "match you up" with a lending institution. I do not think a lending institution would be interested in me, though they are not supposed to be able to discriminate. I am almost sure that people have been in your boat before. If worse comes to worse, I will wait until my credit rating is up a bit. If I read this right, people take out car loans during ch13s and after ch7s to build their credit, why not a student loan?

[HHM]

It should not be a problem to get student loans. You probably still need to get permission from the trustee.

[laurannm]

I completely agree. Although in a Chapter 13 I know you need the permission of your trustee to take on new debt. But given that a student loan typically doesn't require payments until after you graduate, I'm not sure if typically trustee's approve this

[HHM]

I guess this post begs the question...but if you are in the middle of a chapter 13, how are you going to pay the chapter 13 and go back to school (or are you simply taking a class or two).

All you can do is ask, I really don't see why the trustee would refuse it unless, for some reason, it causes a decrease income.

[laurannm]

Sorry, should have been more clear. It would be more for my wife. She is a stay at-home mom currently but with the kids off to school full time in a year or so, she will have nothing to do. We don't really want her to work a regular job because according to our lawyer, we would have to file an amended plan and most if not all of her income would end up going to the trustee anyways.

So we figured if we get stuck in a 13, why not send her back to school (part-time) so that post BK she can enter the field of work she has always wanted to get into?

[HHM]

Sounds like a plan. I don't think it will be a problem (you might run into a problem trying to get private student loans, but you should have not trouble getting regular subsidized loans).

[MajorMike]

Our attorney said it's not a problem at all.