Question: can I have payday loans discharged?

[pdxpride]

So, I will schedule a meeting with an atty. soon.
I have amassed a few thousand in payday loans, over about 5-6 different small company lenders and many I have never paid a cent to. Are these debts something I can get discharged with Ch. 7?

[coma]

I included some, and they didnot say anything. Even when we converted, they never filed claims.

[juststupid]

Thanks for asking, my husband and I have a couple payday loans and I read somewhere they couldn't be included but wasn't for sure. Glad to hear that they can be.

[JollyGG]

They can be included and discharged. However, you are going to need to be very carefuly about the 70/90 day rule with these.

How long ago did you take out the payday advances?

[HHM]

I can't believe how well the propaganda machine of the Payday loan people have been spreading this myth that payday loans cannot be discharged.

YES, Payday loans are unsecured extensions of credit and can be discharged. Where people run into problems is that given the short term nature of the loans, the payday loans tend to fall within the 70/90 day rule for exception to discharge, but given the limited amounts involved, even the payday loan places do not make an effort to have the debt declared nondischargeable.

Also, don't be afraid by the Payday loan places attempts to "renew" the loan, i.e. when you go in, and make the minimum payment, it is common for them to have you sign something saying you are taking out a new loan (loan churning), must courts are sophisticated enough to see through this and only look at the date you originally took out the loan.

[sofarindebt]

About payday loans

I have some also that I have taken out in the last 90 days. I had to keep taking out more to pay off others, etc. My atty told me to stop paying them and include in bkcy, which we are filing at the end of April due to the sheriff sale on our home, we want to buy a month or two more of staying in our home.

He said although 99% of the time internet payday loans won't object to discharge of the debt, the trustee might. He said since it is the law, the trustee has the power to say you have to pay back that amount since it is within 90 days. Is that true? I have never heard of that. I thought only the creditor could object.

[HHM]

He said although 99% of the time internet payday loans won't object to discharge of the debt, the trustee might. He said since it is the law, the trustee has the power to say you have to pay back that amount since it is within 90 days. Is that true? I have never heard of that. I thought only the creditor could object.

I have never heard that, and I can't imagine a chapter 7 trustee would even care. His job is to administer the estate, the chapter 7 trustee has nothing to gain by having a debt declared nondischargeable since that would remove the debt from the BK estate.

Anyway, even if the payday loan was taken out within the 70 day time limit (nearly all payday loans are cash advances, so they fall in the 70 day, more than $750 rule), the payday loan ppl still have to come in and object. And note, most payday loans do not exceed the $750 amount, so the payday loan ppl have the burden of proof of showing fraud.

[SinkingFast]

I have never heard that, and I can't imagine a chapter 7 trustee would even care. His job is to administer the estate, the chapter 7 trustee has nothing to gain by having a debt declared nondischargeable since that would remove the debt from the BK estate.

Anyway, even if the payday loan was taken out within the 70 day time limit (nearly all payday loans are cash advances, so they fall in the 70 day, more than $750 rule), the payday loan ppl still have to come in and object. And note, most payday loans do not exceed the $750 amount, so the payday loan ppl have the burden of proof of showing fraud.

And that's line of credit by line of credit, or, in this case, loan by loan. If you have 3 different $1000 pay day loans with 3 different Lenders, each Lender would have to Object. One might while the other 2 don't. But one Objection doesn't get all 3 Lenders money. Just the one Creditor that does Object.

[spell]

The reason a Trustee might object is that to an outside observer, you taking out several loans, not making a single payment, then declaring bankruptcy sure sounds like abuse and/or fraud.

So, let me ask the pointed question. Trust me if you can't take the stress of it in an online forum, don't do it in bankruptcy court.
When you took out these loans, were you planning on paying them back?

[sofarindebt]

answers to your question

Doesn't everyone who takes out payday loans intend on paying them back? I can speak for most people and say they don't realize how evil and entraping these loans are. Most people have paid $900 on a $300 loan and still owe the principal. It become a trap you never get out of. And legally, under the states laws, those people are entitled to a refund because they have overpayed according to their state laws.

I don't really care of the trustee objects to my payday loans. I just want to pay back what I owe without the thousands of dollars of interest attached.

[Spartan]

The reason a Trustee might object is that to an outside observer, you taking out several loans, not making a single payment, then declaring bankruptcy sure sounds like abuse and/or fraud.

So, let me ask the pointed question. Trust me if you can't take the stress of it in an online forum, don't do it in bankruptcy court.
When you took out these loans, were you planning on paying them back?

1. That is just you 'assuming' how the trustee works. What you assume how things ought to work, is of no consequence.

The trustee's responsiblity is to administrate your bk estate. He/she will object/question your claim of asset exemption. It is the creditors' responsibility to object to dischargeability. The trustees don't go around to do the creditors' jobs for them.

2. If you answer that you have no intention of paying back, when then you deserve whatever comes your way....

[HHM]

1. That is just you 'assuming' how the trustee works. What you assume how things ought to work, is of no consequence.

The trustee's responsiblity is to administrate your bk estate. He/she will object/question your claim of asset exemption. It is the creditors' responsibility to object to dischargeability. The trustees don't go around to do the creditors' jobs for them.

2. If you answer that you have no intention of paying back, when then you deserve whatever comes your way....

Exactly, I mean, I don't even see how the trustee would have legal standing to object. The trustee is appointed to represent ALL creditors, collectively. It is the responsibility of individual creditors to come to BK court to protect their rights.

[spell]

Ah right, I mixed up the TT and the specific creditor.

Speaking specifically of Payday Loans, they're most often too low of a total owed to justify them bothering to hire/send an attorney to push the issue.

[pdxpride]

Good to know that these may be able to be discharged.
I just got papers from one of them taking me to small
claims for a little over $1500 so that ones probably not
dischargable but the rest should be.

Not familiar with the 70/90 day thing but they are all older than
90 days.

[HHM]

It is still dischargeable...your best option would be to file BK before the Small Claims court hearing...but even if you have to wait until after the hearing, you can still get the debt eliminated through BK (that is unless you actually did commit fraud in taking out the loans).