I hesitate to,ask this…but where are these college educated kids? Why aren’t they helping pay back the loans that funded THEIR college educations. Shame on them.
Which is also why no judge will find in his favor. “Let me understand sir, the loan company offered you a chance to consolidate all of your debt, make zero payments for xx years, and then have the debt be legally discharged. At worst, you’d then have to pay a tax bill on some of the forgiven debt. But you chose not to.”
Hmmmmm.
I’m rather surprised that he’s been able to keep his home for 14+ years of unemployment. I do not think there is any cheap housing in Duxbury. None. Zero. Zip.
There are attorneys and agencies who represent people who are low income and need civil help. Legal aid. Not as many who do bankruptcies but the courts do allow the attorney to be paid before some other creditors, so most people who file bankruptcy do have attorneys.
If you liked that one, what about the kid following in her sister’s footsteps toward 125K in undergrad debt?
http://talk.collegeconfidential.com/college-search-selection/1867453-app-state-vs-western-carolina.html
What’s his house worth? I suspect the govt would trump the bank an get the value from that. Doesn’t bankruptcy protect a family home? So, they’re trying to get him blocked from bankruptcy. I think this will be an unusual case that doesn’t set wide precedent.
Bad cases make bad law. I hope the judges resist any temptation to help this guy out.
The government does not get ahead of the bank. A mortgage has first priority. In some states, the bank takes all on the mortgage forclosure, in others the other creditors get in line for any equity, and the government might skip to the front in front of all nonsecured lenders.
Do we think someone who hasn’t worked in 15 years has equity in the home? Pretty unlikely unless in a state like florida where there is a 100% homestead exemption from creditors. I doubt Massachusetts has that.
Actually, it’s hard cases that make bad law. This one doesn’t seem all that hard to me. There has to be a more sympathetic bankrupt to challenge the limitation.
Oops, @Hunt, sorry I got the quotation wrong. You are correct. But I agree: this case isn’t hard, and there must be more sympathetic individuals.
Being CC regulars we all have a somewhat different perspective in the “student debt crisis”. A part of it is of the students’ and parents’ own making.
I would submit that 99.9% of it is the “student’s and parents’ own making”. (And that goes the for profit schools, too, since their “students” are adults in every sense of the word.)
The only part that is not of their own making is fraud.
I think there are two types of fraud in these cases (although I think all of the fraudulent behavior is reprehensible).
The first is where the student is a somewhat willing participant- enrolling in a diploma mill type school, using their Pell for tuition and using their loans for all sorts of stupid things that any rational person would realize is going to turn out badly- we’ve had kids here posting before about taking Spring Break trips financed by their loans, renting luxury condos in lieu of “crappy dorms”. So yes- the schools are to blame, but the students are active and willing participants in the game.
The second is where the student is truly being victimized- a for-profit college claiming that a Bachelor’s degree in Travel and Tourism is going to yield great jobs paying 60K per year right out of college… and then the graduates are basically interviewing for minimum wage jobs along with HS graduates. (Disney doesn’t need to hire people from fly by night colleges, thank you very much).
But some modicum of common sense also needs to kick in. There was a for-profit college in my area that was shut down which was popular for its allied health degrees-- which happens to be something that the local community college does quite well. Why pay for a four year degree to become a radiology assistant if the community college charges 1/5 of that per year AND can get you out in 24 months?
^The students who choose for-profit career training over community college have usually been burned by the educational establishment in some way. Many of them are marginal students to begin with and appreciate the fact that they have have to take “extra” classes that would be required at CC. And they aren’t financially savvy enough to know that they are being had.
His bankruptcy settlement was approved:
http://www.boston.com/news/education/2016/04/15/court-duxbury-man-student-debt-settle
Wow
one of the beauties of being a federal judge. Lifetime appointment. Better than tenure. 