Problems with School Loans and Chp 7
Hello.. I'm a newbie here, please forgive me if I've violated any rules by cross-posting this from another thread.. I'm in dire straits here and need some help/advice/consoling...
I am curious about the experiences people had with your school loans and Chp 7 case. I had my 341 yesterday and it seems that my Chp 7 may be thrown out, because of how the school loans were listed on my paperwork. See the info below, that I posted on the creditboards forum... If you can provide any insight, it would be a big help.
Thanks so much!
ProjMgrNewb
On 4/15, I emailed my attorney to confirm the appointment, see what I needed to bring, etc. He said that the US Trustee in my case has an issue with my school loans, but that we'd talk about it in the morning. I'm thinking, eh.. no big deal, right..
My 341 is 4/16. He gets there 15 mins before the hearing. He tells me 10 mins prior to the hearing that the issue with my school loans is that he included them in the paperwork as a Priority Claim. The US Trustee is arguing that they do not belong there. If they are not included as a Priority Claim, then it throws me from a Chp 7 into a Chp 13.
Of course, I'm floored. I'm thinking to myself.... why couldn't he have prepared me for this ahead of time?? He said that the Northern district of Ohio has ruled that it should be included as Priority Claim, but that my district (Southern) has not ruled either way. Apparently, the argument is that the loans should go under the "Additional Expense Claim", and by doing that it would give $ to pay in a Chp 13. This is not including the fact that I am going to have to pay $3500 in Federal Taxes, and $500 in State taxes this year. According to some on-the-spot calculations, it will still give $ to pay to a 13.
All that was before the hearing...
We go in, and naturally I'm a nervous wreck. We get through the preliminaries of name, address, etc. Then there's the unexpected invasive stuff. I had to, in a public forum, explain my health situation as to why I have a large amount of out of pocket expenses. I had to explain different other things like my 401k withdrawl from last year, current living arrangement, boyfriend's age (we live together - I'm 34, he's 33), if I was comfortable in my job and if my position is in any danger, all which the trustee said that the US Trustee wanted asked. It was brought up though that there was an error in the paperwork regarding the car payment (my b/f got a loan for me for a vehicle, all which is in his name), that supposedly will work in my favor. I was in that room for 20 minutes. It was horrible. I am amazed that I didn't have a breakdown while sitting there.
Lawyer said that he is going to contact the US Trustee's office today, and that he'll "be in contact with me soon." I have absolutely NO IDEA what is going to happen with my case. Looks like the following:
1) Maybe convince the US Trustee to keep it as a Chp 7 (not sure if this is likely).
2) Litigate and Fight for it to go on a Chp 7 based on previous case law (not sure if this is feasible due to $$ and the fact that there are other states that have case law to put the student loans in the Additional Expense section like the Trustee wants.)
3) Go with a Chp 13
4) Dismiss the case.
I am curious about the experiences people had with your school loans and Chp 7 case. I had my 341 yesterday and it seems that my Chp 7 may be thrown out, because of how the school loans were listed on my paperwork. See the info below, that I posted on the creditboards forum... If you can provide any insight, it would be a big help.
Thanks so much!
ProjMgrNewb
On 4/15, I emailed my attorney to confirm the appointment, see what I needed to bring, etc. He said that the US Trustee in my case has an issue with my school loans, but that we'd talk about it in the morning. I'm thinking, eh.. no big deal, right..
My 341 is 4/16. He gets there 15 mins before the hearing. He tells me 10 mins prior to the hearing that the issue with my school loans is that he included them in the paperwork as a Priority Claim. The US Trustee is arguing that they do not belong there. If they are not included as a Priority Claim, then it throws me from a Chp 7 into a Chp 13.
Of course, I'm floored. I'm thinking to myself.... why couldn't he have prepared me for this ahead of time?? He said that the Northern district of Ohio has ruled that it should be included as Priority Claim, but that my district (Southern) has not ruled either way. Apparently, the argument is that the loans should go under the "Additional Expense Claim", and by doing that it would give $ to pay in a Chp 13. This is not including the fact that I am going to have to pay $3500 in Federal Taxes, and $500 in State taxes this year. According to some on-the-spot calculations, it will still give $ to pay to a 13.
All that was before the hearing...
We go in, and naturally I'm a nervous wreck. We get through the preliminaries of name, address, etc. Then there's the unexpected invasive stuff. I had to, in a public forum, explain my health situation as to why I have a large amount of out of pocket expenses. I had to explain different other things like my 401k withdrawl from last year, current living arrangement, boyfriend's age (we live together - I'm 34, he's 33), if I was comfortable in my job and if my position is in any danger, all which the trustee said that the US Trustee wanted asked. It was brought up though that there was an error in the paperwork regarding the car payment (my b/f got a loan for me for a vehicle, all which is in his name), that supposedly will work in my favor. I was in that room for 20 minutes. It was horrible. I am amazed that I didn't have a breakdown while sitting there.
Lawyer said that he is going to contact the US Trustee's office today, and that he'll "be in contact with me soon." I have absolutely NO IDEA what is going to happen with my case. Looks like the following:
1) Maybe convince the US Trustee to keep it as a Chp 7 (not sure if this is likely).
2) Litigate and Fight for it to go on a Chp 7 based on previous case law (not sure if this is feasible due to $$ and the fact that there are other states that have case law to put the student loans in the Additional Expense section like the Trustee wants.)
3) Go with a Chp 13
4) Dismiss the case.
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