Meeting with Atty today re: Chapter 11

[TeacherMomma]

Well good to know about the admin fees! I don't know how we'll work it out....

[backtoschool]

Well good to know about the admin fees! I don't know how we'll work it out....

The key is to not let the loans or even one loan go into default. If you consolidate when the loans are in default, or you get to the point where they garnish your wages, they will add on a 25% admin fee for "collection costs". I went into default on my loans and then I consolidated them. But I missed two loans in the consolidation and those two loans were still in default. So I had to reconsolidate. The 25% admin fee was applied TWICE. My original student loan balance was under 50k. With the two 25% admin fees and the interest that accrued when in default, my loan balance doubled.

You have 270 days before the loans go into default. Each full payment while late, keeps default from happening for 30 days. Here are possible ways to keep the loans from going into default. Each way by itself will keep the loans from going into default:

1. Ask for a hardship forbearance while you figure out how to qualify for a chapter 13. Interest accrues on a hardship forbearance but they are automatically granted, and there are no payments. (this is what the student loans go into when you file chapter 13 and can't include your loans in your plans)

2. Register for six credit hours in any community college, online college, etc. This will put the loans into deferment.

Either of these approaches will keep the loans from going into default while you figure out how to get into a chapter 13. Since there is no way to avoid the loans, and garnishment will add the 25% admin fee, defaulting on the loans in lieu of the chapter 13 is going to end up costing you way more than it saves you.

[TeacherMomma]

The only way for me to qualify for a 13 is to pay down 100K and get under the 336K debt limit. So that isn't going to happen any time soon. A 13 was never in the works, only a 7 and a possible 11. Although I would be very happy to be part of a 13 in which the SLs were paid as part of the plan so that the interest would not accumulate.
Also, the majority of my SLs are private and there is no deferrment or forbearance available on them at all - for any reason excpe the forberance that BK provides me at the moment - even in school deferrment is not an option. I am in school now....

It is just crappy all around.....

(PS. When would 10 days be from Sept 30th? I have 10 days to tell the UST that I am dismissing or converting - is it 10 DAYS or 10 business days?)

[2manybills]

Is doing a Chapter 11 pro se impossible.

[backtoschool]

The only way for me to qualify for a 13 is to pay down 100K and get under the 336K debt limit. So that isn't going to happen any time soon. A 13 was never in the works, only a 7 and a possible 11. Although I would be very happy to be part of a 13 in which the SLs were paid as part of the plan so that the interest would not accumulate.
Also, the majority of my SLs are private and there is no deferrment or forbearance available on them at all - for any reason excpe the forberance that BK provides me at the moment - even in school deferrment is not an option. I am in school now....

It is just crappy all around.....

(PS. When would 10 days be from Sept 30th? I have 10 days to tell the UST that I am dismissing or converting - is it 10 DAYS or 10 business days?)

Many private loans allow a one year "hardship" forbearance. Have you already taken that? Grad plus loans offer more than that....

A year could get you into the chap 13. I wrote chap 13 in my earlier post because that is what the US trustee wanted to push you into if you had lower loan balances....

Sallie Mae, ACS, Citibank and Chase offer one year hardship forbearance. For Sallie Mae you have to escalate past the CSR to get it but they do offer it.

[2manybills]

(PS. When would 10 days be from Sept 30th? I have 10 days to tell the UST that I am dismissing or converting - is it 10 DAYS or 10 business days?)

Is it calendar or "court days"? 10 "calendar days" falls on Saturday October 10 which takes you until Monday the 12th. 10 "court days" takes you to the 12th. I'm pretty sure it is calendar days. In California, the CCP always provides that when a due date falls on a weekend or holiday, it always goes to Monday.

[TeacherMomma]

Why would a year get me into the 13? I cannot pay 100K down in a year to meet the limit. I have exceeded all programs on all of my loans.

And 2manybills, it just says "days". I know we went through this before with when my responses were due...and I think we went with calendar days. And as far as a Pro Se Chap 11 - I am thinking it is impossible....I mean, any lawyer I have spoken with, and even the trustee and the JUDGE dont know what to do with me, how can I know what to do with me!?

[backtoschool]

Why would a year get me into the 13? I cannot pay 100K down in a year to meet the limit. I have exceeded all programs on all of my loans.

And 2manybills, it just says "days". I know we went through this before with when my responses were due...and I think we went with calendar days. And as far as a Pro Se Chap 11 - I am thinking it is impossible....I mean, any lawyer I have spoken with, and even the trustee and the JUDGE dont know what to do with me, how can I know what to do with me!?

I am so sorry TeacherMomma. I was hoping that a year would maybe have the chap 13 limits be raised with inflation or thrown out or something. The house is working on legislation to make private student loans dischargeable and that could be done in a year. I was not thinking about you reducing your debt 100k in a year.

[2manybills]

And 2manybills, it just says "days". I know we went through this before with when my responses were due...and I think we went with calendar days. And as far as a Pro Se Chap 11 - I am thinking it is impossible....I mean, any lawyer I have spoken with, and even the trustee and the JUDGE dont know what to do with me, how can I know what to do with me!?

So it is calendar days when it just says "days". That would put you to Monday. I will confirm that the CCP applies the same way in Federal Court on Westlaw and get back to you via PM.

I know, if we can figure out how to do this thing, I would help. I will email you.

[TeacherMomma]

Thanks