Bankruptcy Judge Discharges $220K in Federal Student Loans

Diane Ashline, a 47-year old single mother, worked for 20 years as a dental assistant. Hoping to increase her income, she took out student loans to get an undergraduate degree and a master’s degree from Kaplan University, a for-profit school. Unfortunately, these degrees did not help her financially. Ashline never defaulted on her student loans. … Read more

Nystrand v. Kingdom of Sweden: Another underemployed lawyer seeks bankruptcy relief

A common saying when I was young (in the last century) was the old adage that lawyers are people who wish to make a lot of money but are risk-averse. That observation certainly rang true when I went to law school in the 1970s. I graduated from the University of Texas School of Law with … Read more

Dept of Ed Position in Student Loan Bankruptcy Case is Nukin Futs

Tamara Parvizi, age 51, sought to discharge $653,743 in student-loan debt in a Massachusetts bankruptcy court. That’s a lot of debt–just shy of two-thirds of a million dollars. For 15 years, Parvizi took out student loans to pursue several degrees, and she became fluent in at least four languages. Nevertheless, Parvizi never made a single … Read more

Senators Show Commonsense With Student Loan Bankruptcy Bill

Piggy Bank Hurt

Is this the year of Jubilee? Is this the year that distressed student-loan debtors finally get to shake off mountainous debt in the bankruptcy courts? Maybe. This week, Senator Richard Durbin, an Illinois Democrat, and Senator John Cornyn, a Texas Republican, filed a bill that would allow college-loan debtors to discharge their federal student loans … Read more

Bankruptcy Judge – “This Student Loan Case Fits the Definition of Insanity”

In Goodvin v. Educational Credit Management Corporation, Judge Dale Somers, a Kansas bankruptcy judge, began his opinion with these words: “This student loan case fits the definition of insanity.” Judge Somers went on to chronicle the story of Jeffrey Goodvin. Mr. Goodvin attended Wichita State University for four years (1982-1986) but did not obtain a … Read more

Bankruptcy Judges Eliminates Federal Student Loans Without IDR First

Seth Koeut was born in Cambodia and came to the United States as a child. Like many immigrants, he applied himself energetically to obtain a better life. He graduated 6th in his high school class and went on to earn two bachelor’s degrees from Duke University. Mr. Koeut then went to medical school and received … Read more

A Bankruptcy Court Eliminates Grandmother’s Student Loans

Between 2006 and 2015, Jamie Mudd took out 41 student loans to attend Heald College, a for-profit institution, and San Joaquin Delta College, a public institution. In 2015, she rolled these loans into two consolidated federal loans, totally about $72,000. Mudd put her student loans into an income-based repayment plan (IBRP) that established her monthly … Read more

Student Loan Servicer Hit With Big Contempt Sanction

In September 2020, Bankruptcy Judge Martin Glen slapped a huge contempt penalty on Great Lakes Educational Loan Servicers–$378,629.62! Why? Because Great Lakes repeatedly refused to comply with Judge Glen’s directives in a student-loan bankruptcy case. Leary v. Great Lakes Educational Loan Servicers: The facts In 2015, Sheldon Leary filed an adversary action in a New … Read more

Judge Grants Partial Discharge of Private Student Loan Debt

Mendenhall v. Navient Corporation: A $76,000 student-loan debt grows fivefold In 2007, Steven Mendenhall obtained a bachelor’s degree in film and video production from Brooks Institute of Photography, a for-profit college in California, which later closed. To finance his studies, Mendenhall took out about $75,000 in federal student loans and $76,000 in private loans from … Read more

ECMC – Your Student Loans are a Life Sentence

The U.S. Department of Education and Educational Credit Management Corporation (ECMC), DOE’s ruthless sidekick, don’t want anyone to get bankruptcy relief. This has been DOE’s policy for many years. Let’s take a look at Mosley v. Educational Credit Management Corporation, decided by the Eleventh Circuit back in 2007. As we will see, Mosley was clearly … Read more

Williams v. U.S. Department of Education: How does someone run up $400,000 in student-loan debt?

In Greene v. U.S. Department of Education, Judge Richard Posner, a universally esteemed jurist, remarked that the criteria for determining “undue hardship” in student-loan bankruptcy cases are complex. Nevertheless, Judge Posner observed, “[t]he size of the debt is relevant–the larger it is, the more likely that imposing full liability on the debtor will produce an … Read more

Hlady v. Educational Credit Management Corporation: Another Heartless Bankruptcy Judge Denies Relief to a Distressed Student-Loan Debtor

Books

Cherie Ann Hlady graduated from Hofstra Law School in 2006. She passed the New York bar exam and began practicing law. Unfortunately, Hlady could not make ends meet as a practicing lawyer. Ten years after getting her law degree, she filed for bankruptcy. Hlady took out student loans totaling $40,000 to finance her legal education, … Read more

The Best List of Private Student Loans to Bankrupt

Mark Kantrowitz from Private Student Loans Guru recently wrote an article for Forbes – How To Bankrupt Your Student Loans. The article is great but it contains the best list of private student loans that are not qualified education loans and should be able to be discharged in bankruptcy as I describe in this post. … Read more