San Diego: New Ruling Allows Student Loans to be Discharged in Chapter 13!

[dingdong]

I just want that debtor to brush up against me and rub some of that good luck off on me!

Lucky Bastard!

Green with envy!

[pcn]

I agree, to a point. But not with the idea that student loan debt is somehow more "untouchable" ("undischargeable"??) than any other type of debt. That post seemed somewhat judgemental to me. I should have just said as much, rather than trying to make a comparison.

[justbroke]

Does it really matter what it was used for?

The courts have routinely believed so. Take a a look at the "special circumstances" clause in the 707(b) Dismissal paragraph. While not all inclusive, medical needs and military service seem to trump everything else from a policy standard and a... well... underlying moral standard.

If I went to Vegas and got $100K in debt... I think that's much different than the person spending $100K on transplant surgery and recovery for their child. One is a choice, and the other is not a choice, or a choice amongst a limited number of choices.

But that's me.

[pcn]

My thoughts as well. And take it one step further. What if 60k of my 100k unsecured debt was created by visiting my dying mother in Bora Bora? Is one's debt any different, or more justified, than another's. Does it really matter what it was used for?

[caj0524]

But....

Speaking as someone who paid for their education and has no student loans, I perceive even the notion of being able to discharge this debt as being completely FLUCKED UP and I want my mother ****in money back.

But what is the difference between my $100k in debt ($60k student loans & $40k in other unsecured's), versus someone else's $100k in unsecured debt only?

Isn't $100k in default still $100k?

If I used $60k of my debt for an education, while someone else used $60k for assorted (unsecured) stuff... what's the diff?

[liz417]

Speaking as someone who paid for their education and has no student loans, I perceive even the notion of being able to discharge this debt as being completely FLUCKED UP and I want my mother ****in money back.

Ouch...LOL!

[justbroke]

speaking as someone who paid for their education and has no student loans, i perceive even the notion of being able to discharge this debt as being completely $#*$&*#(! Up and i want my mother $#*@#&*$ money back.

lol

[CH33 Paralegal]

Speaking as someone who paid for their education and has no student loans, I perceive even the notion of being able to discharge this debt as being completely FLUCKED UP and I want my mother ****in money back.

[rrockinggramma]

is this true for government loans as well, or just the private lenders?

[justbroke]

Also note, I will have to re read it, but if I recall, this was a chapter 13 filed back in 2001 (or something like that, but in any event, I believe it was pre-2005 law).

Yep, it was a 2001 case (12/6/2001). I don't know myself if it has impact on BAPCPA, but this was decided in 2009, and there is no mention, vis-a-vis, BAPCPA pre or post for that matter.

I wholeheartedly agree that this is a one in a million case. It is not that easy to get a Plan confirmed without certain creditors complaining when their rights are being modified (like mortgage creditors, student loan creditors, HOAs, government entities, etc).

[HHM]

Note, not to rain on the parade, but this case is still the exception. Also note, I will have to re read it, but if I recall, this was a chapter 13 filed back in 2001 (or something like that, but in any event, I believe it was pre-2005 law).

[justbroke]

Discharge is a Discharge!

Why is it ok in 13 and not appropriate in 7 ?!?!?!?

Because in a Chapter 13, you write a Plan. A Chapter 13 does offer a better discharge (a few more things can be discharged) than a Chapter 7.

The issue with Chapter 13s, is that the Plan is binding on all that are addressed by the Plan, and especially those creditors which submitted a proof of claim. It's basically new terms and can (and does) alter the terms of most contracts/agreements! Mine specifically has a provision which destroys (makes void) any "arbitration" agreement in any agreement/contract I signed!

[dingdong]

Grrrr!

Student loans!

just paid mine yesterday.


Double Grrrr!

I would have been a very happy camper if those bad boys had been discharged.

I am going to be drivin' to the post office in my Rascal when they are finally paid off-well I mean... forgiven after the 25 years of repayment.

At least I have that to look forward to.

[fyi2]

Grrrr....

Slippery

[dingdong]

Because the creditors ( here the SL lender) was notified of the plan payments and didn't object. They didn't protect their rights by objecting and thus lost their rights ( as per the judge)

they were paid back a portion of the debt.
in a 7, the debt is liquidated.(wiped out)