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Just needed some reassurances.
I filed for BK7 on April 16. Discharged on July 20. While in bankruptcy, Navient balance reported IIB on all three credit bureaus.
Equifax updated my report as of September 9th. The status of Navient went from IIB to Bad Debt; Placed for collection.
The description reads as follow:
Bankruptcy Chapter 7 Student Loan -> Charged Off Account Student Loan Amount In High Credit is Original Charge Off Amount
The loan was first placed into collection in October 2012. I don't know when the last time have I acknowledged this debt. But I can verify that I ignored my responsibility on this loan. On CreditKarma while in bankruptcy, I recall seeing August 12, 2014 was the last payment I made. Monthly payment showed $1.
I also have a federal student loan that was never reported IIB temporarily. It stayed active and true, in good standing the entire time. However, my Navient loan did report the balanced owed, then it was IIB and removed from my report. Now it's back.
Is this wrong? Or is this absolutely correct that I cannot discharge my private student loan? I took out $12k with Sallie Mae, later changed to Naivent and it was charged off. Now the balance owed is $17,328 as of September 9th. Up from $17,220 as shown in my alerts on myFICO. I don't remember the date of the this one part, the remarks showed Navient as charged off as bad debt, profit and loss write-off.
That is what I am seeing in Equifax. Nothing on Experian yet. TransUnion is showing total balance owed went up. The hit I got from Equifax went down 17 points. TransUnion, went down by 1 point.
Any insights would be greatly appreciated.
For the most part, student loans are not discharged in bankruptcy. They CAN be discharged, but you must demonstrate (to the satisfaction of the trustee) that repayment would constitute an undue hardship on you - basically your attorney must actively seek to discharge them, rather than simply listing them among your other debts.
So with that said, what exactly should I do?
My pay raise is coming soon (current salary 30k), so I'd like to jump at this before the raise comes in?
Consult your attorney as to whether it possible to do. Since you are working and have 30K of income, I'm geussing the answer is *probably* going to be no, but ask anyway.
While working my lawyer in the process of filing, I recall my lawyer said she don't know much about student loans.
I will try and ask. Hopefully I don't have to pay a fee? I would hate to do so.
Thanks, Norman!
@audio-disabled wrote:While working my lawyer in the process of filing, I recall my lawyer said she don't know much about student loans.
I will try and ask. Hopefully I don't have to pay a fee? I would hate to do so.
Thanks, Norman!
Well, from what I have read, you really have to show the trustee that repaying them would create undue hardship. Usually that means you have a very limited income with virtually no chance of that changing - such as being disabled or living on a retirement income.
When doing a bankruptcy, you need to file an extra paper, called an adversary proceeding, which is a lawsuit within the bankrutcy. Then you must usually pass what is called the Brunner test (Google it). In most courts they follow this. There is one district (?) that does not. You need to be able to prove undue hardship and that there is no potential of it changing.
https://www.forbes.com/sites/zackfriedman/2017/05/19/student-loans-bankruptcy/#1ae5e8bd2ecf
http://www.studentloanborrowerassistance.org/bankruptcy/