Apply for Student loan while on Ch 13?

[JGGR]

We are on our 2nd payment for our Ch 13. We had our 341 last week and it went well, I guess. My husband wants to go back to school but the only way he can do is by applying for student loans. In our 341 meeting, the Trustee read that some of our income will go towards his school books and materials beginning in the Spring of '06. My question is, can he apply for student loan even though we are on bankruptcy? I know this is federal, and I know my own student loans from when I was in school are not dischargeable, but how easy -or hard- will it be for him to apply for a student loan(s)? Anybody has any idea? Would it be frown upon if they know that we're seeking a loan, even though it for school?

Thanks!

[Armmick9]

[ana]

My student loan disbursements were cancelled also and I was told by lender that I could reapply after discharge. I filed Chapter 7.

[originalhealer]

Why would your loan disbursements be cancelled? I thought federal financial aid had nothing to do with credit? Everyone knows that federal student loans cannot be discharged with the exception of extreme circumstances?!?

I hope they don't do that to me, because I am in grad school to get my teaching certification so that I can get paid my full teaching salary, so that I can pay my bills! If they cancel my student loans, which were actually due to be disbursed on November 15, and I converted my Ch 7 to a Ch 13 on Nov 10. If they cancel my student loans, I'll have to quit grad school, and then how will I get my teaching certification? I'm trying really hard to get out of this financial mess, and I need my teaching certification in order to do that.

[ana]

For original healer: When I talked to NELNET I was told whenever anyone filed for bankruptcy the disbursements stop. I did not understand why either! I was not delinquent nor have I ever been. All my previous loans were consolidated in Jun and where in-school deferrred. I did not or do not expect them to be discharged in bamkruptcy either. The best thing to do is talk to the financial aid officer at your school. I plan to talk to mine this Tuesday.
My next disbursement was scheduled for 12/9.

[originalhealer]

Unfortunately, I contacted my bank and they, too, cancelled my disbursement. It was due on November 15. Now I'm screwed.

On Monday I am going to call my Financial Aid advisor and see what he says, plus I emailed my Trustee. I saw on my Trustee's website that he had an Outside Loan application, and it had instructions for what to do if you are applying for a student loan. But in my case, I had applied for it long ago and it was due to be disbursed. Now I owe my school $1100.00. Now what???

[Armmick9]

Any one had any luck getting any information from the Financial Aid office?

[originalhealer]

I am really angry right now. I didn't contact my school today because I was at work all day. But I contacted my Chapter 13 Trustee, and rather than tell me what to do with the Outside Loan application on his website, he tells me that I should consult an attorney.

First of all, I have been dealing with this case since I filed for Chapter 7 in July. I have filed my own motions, made my own amendments, handled my last 341 meeting for the Chapter 7, and will be handling my own Chapter 13 341 meeting on December 27.

Second of all, I HAVE consulted several attorneys, especially about a difficult creditor that I have. But the last one I spoke to wanted me to pay her $2500 through the bankruptcy. Her $2500 would make me have to extend my case from three to five years, because I don't make that much money. In addition, I already did all of the work. Why should I have to turn around and pay her $2500? The value of the items that the difficult creditor has in their possession isn't even worth that much.

So the worthless Trustee says that to answer my question about what to do about my cancelled student loan, is legal advice and he can't help me. So, exactly what is his purpose, anyway? He is supposed to be paid a percentage of my payment every month, for what? I can lick my own stamps!

[JGGR]

Ok... well, thanks everyone for responding to my question. I did not mean to scare anyone, so I apologize if I did. I am going to contact my husband's school before he applies to see what they say. I hope he can get a loan in spite of our circumstances. I too want to go back to school for a Master's, hopefully after he's done, but I know I don't know how! Ok - I'll keep looking into this and see what information I get! Thanks!

[originalhealer]

One piece of encouraging news: after I emailed my Trustee asking him what is his purpose, exactly, he emailed me back saying that HE HAD NEVER HEARD OF A BANK CANCELLING A STUDENT LOAN BECAUSE THE PERSON FILED BANKRUPTCY. In fact, I read somewhere online that it is against the bankruptcy code to be turned down for a student loan because you filed bankruptcy. I am not sure if they meant only federal loans, though.

So, now I have to go back to contacting my school and the bank to see if I can get to the bottom of this.

[JGGR]

Well, I have some news. I first FAFSA. They said to contact the school that he'd like to attend and see what they say. According to fafsa, that is up to the school. So I contacted my husband's future school. The financial aid office said it is not up to them to deny or approve a student loan and to contact my state's student loan office. I did that, and I was told that because I am under bankruptcy, I am not allowed to apply for a studnet loan, and if I do, it'd be denied!!!
I'm surprised your trustee gave you that information, original healer. I don't know which is true. I really want him to go to school and his school expenses were included in our plan, so now I don't know what's going to happen.

[originalhealer]

Like in my last post, it is supposedly against the bankruptcy code to be turned down for federal stafford loans, because they are not based on credit. What I went ahead and did is I applied all over again through a different bank. Because my previous bank had other previous loans for me and they had received a Proof of Claim form from the bankruptcy court, so I believe that is why they cancelled my disbursement. But a new bank that is not involved with my case should go ahead and grant me the student loan. I am trying to get my Master's degree so that I can get out of this financial bind. I have to keep trying. I'll keep you posted.

[Armmick9]

[JGGR]

I know! We all seem to be getting different answers. I was told by my state's student loan agency that we'd be denied. I guess I'll just try and see what happens. That is the only to find out.

Good luck Armmick9. I hope you get to the bottom of this and your situation gets cleared out.

[JGGR]

Ok, please keep me posted everyone! I will try to have him apply in the next week or so and see what happens. I really want him to go to school and once he's done, I want to go and do my master's! I will try to call my state office again and see if they tell me something different. I'll keep my fingers crossed!