I filed chapter 7 BK in 2010, which was discharged in 2011 however was told I could not discharge my student loan with Sallie Mae at the time, now Navient. I have continued to pay the loan under a payment reduction plan and struggle to do so still.
I read all these things that the loan could have been discharged under BK and wonder if it is true and if it still can be done. It’s a private loan (3314 tuition answer) with them and I don’t believe has forgiveness options.
Can it still be discharged? what options do I have?
In general what you have is a technical situation and a reality situation when it comes to private student loans. Technically the loan may have been discharged if the school was not accredited, the funds were not used for eligible educational expenses, or the loan was not guaranteed by a non-profit entity.
The reality is those issues would have to be presented and pursued to get a definitive answer from the bankruptcy court regarding your specific loan. As an example you can read this to understand what private loans are easier to discharge.
The majority of people have received and continue to receive advice that all student loans can’t be discharged in bankruptcy. That is simply and factually not true.
All of that being said I’m afraid you are not left in a simple position. To get some clarity on your specific situation will require a legal opinion and not all attorneys are experts in this situation. I do publish my list of student loan attorneys you should consider asking for advice.
One option to pursue discharge of the loans if an attorney gives you a thumbs up to proceed is to file suit against Navient in an Adversary Proceeding to determine eligibility and hopefully eventual discharge.
Thankfully you mentioned you had a Tuition Answer loan. Those loans are not federally guaranteed and Navient says, “These loans were primarily made at schools not eligible for Title IV loans” which leaves them exposed to discharge. – Source
This means you have a better than average shot at getting a legal opinion the loan was not protected, discharged in your bankruptcy, and any effort to collect on the discharged debt creates a huge liability for Navient.
Attorney Austin Smith previously said, “Regardless of any potential false pretenses, it’s very likely that your Tuition Answer loans are dischargeable, and thus were discharged in your bankruptcy in 2009. However, it’s impossible to say for certain without reviewing your total federal loan borrowing history and your “Cost of Attendance.” – Source
So the bottom line from my point of view is you have a situation worth pursuing with an attorney knowledgeable in this specific area. Based on the type of loan you have there is a better than average chance the loans are or were all or some discharged but this is not something you and I are going to resolve. It’s going to take a booksmart attorney with technical knowledge and a willingness to help.