co-signer of student loans

[hawk25]

This is a 2 part question:

1. I co-signed for my son's student loans and Ive making the payments for him while he is in school. As a co-signer, am I allowed to put this as an expense?

2. I know that 90 days before filing, you can't pay any single unsecured creditor $600 or more or that would be counted as a preference. Student loans falls in this category. So I am thinking I will continue paying each month until 90 days before. And then my son can make the last 3 payments before filing. Does anyone see an issue with that?

[hawk25]

Ok so I did some more digging around and still havent found an answer to my question but I did find some valuable info that others on this site might find useful. It seems that private student loans are unsecured while federal student loans are secured? I am not positive on this though.

[biotechsolution]

both student loans, both public and private are considered 'unsecured priority' so they are both non-dischargeable. Plus unfortunately you cannot include them in your means test because they will be deferred in your bk process.

[hawk25]

both student loans, both public and private are considered 'unsecured priority' so they are both non-dischargeable. Plus unfortunately you cannot include them in your means test because they will be deferred in your bk process.

Thanks for the clarification but they can be listed as an expense in schedule J right?

[tcreegan]

student loan payment on schedule J?

That is a really good question Hawk25, can you put student loan payments as an "installment payment" on Schedule J?

biotech has it right, both private and federal student loans are unsecured priority and are not dischargeable.

I did list them on the creditors matrix........although it seemed futile...

Tom in Colo

[HHM]

This is a 2 part question:

1. I co-signed for my son's student loans and Ive making the payments for him while he is in school. As a co-signer, am I allowed to put this as an expense?

2. I know that 90 days before filing, you can't pay any single unsecured creditor $600 or more or that would be counted as a preference. Student loans falls in this category. So I am thinking I will continue paying each month until 90 days before. And then my son can make the last 3 payments before filing. Does anyone see an issue with that?

1. No. The trustee and court will not allow payment of an unsecured debt as an expense for chapter 7 bankruptcy (except for taxes under certain circumstances).

2. How much are the payments? In any event, it is probably a non-issue. Unless there are other assets to go after, the trustee will probably not mess around trying to get the money from these payments (unless they are really large).

On a technical note (to Biotech), student loans are NOT PRIORITY debts. Student loans are non-dischargeable, but they are not priority.