Expert: Mark J. Markus- California Bankruptcy Attorney - 1/9/2010

Question
QUESTION: In June 1998, I filed a BK7 and filed my student loans. My daughter was dx with Cancer and i was ruined financially. At the meeting of creditors, no one showed, no hardship hearing. BK discharged in Nov 1998. In Oct (14) 2005, BK 7, re filed student loans AFTER they started harassing me and taking my income tax refunds (had not done this since the 1998 filing). Again, no hardship meeting, no creditors showed. Discharged in March 2006. 2008, harassment re starts with student loans, now garnishing my income taxes AGAIN. Please, what am I to do? These loans originated in 1989.
Im TIRED of trying to fight the system

ANSWER: The student loans would only have been discharged in your 1998 chapter 7 case if they had been in repayment for at least 7 years, EXCLUSIVE of any forbearance or deferment periods, prior to filing your case.  If they were ever in deferment or forbearance during that time, those periods get added to the 7 year period.  If you think you met those criteria, then you may want to file an action against the student loan agency in your 1998 case, but you'll have to obtain proof of all the repayment dates and forbearance/deferment periods, etc.  I'm guessing that you did not meet those criteria and the loans were not discharged in your 1998 case.

The only other way to discharge student loans is to prove undue hardship, and you have to file a complaint and go through a trial for that.

I have no idea whether or not you meet the criteria for an undue hardship discharge, but you should consult with an attorney in the jurisdiction where your case was filed to see about possibly reopening the 2005 case to litigate that.

To see more about the undue hardship test, at least as it applies in the Ninth Circuit, please visit http://www.bklaw.com/chapter7/student_loans.html



---------- FOLLOW-UP ----------

QUESTION: If I re open the BK7 case from October 2005, will this restart the entire process over from todays date?
And will the trustee determine again if I qualify for discharge? If so, can I then ammend the BK 7 and add current debts? Because to me this is like starting all over again by re -opening the entire case. Also, I had a paralegal complete my 2005 paperwork, I explained all of these circumstances at the time and he felt I had nothing to worry about, therefore, said I did not need to submit a hardship filing. Oh my goodness. PLEASE give me some good news here. I am O.K. with re opening if in fact it starts this entire BK 7 over, even if it remains on my credit for a longer period of time.

I have my reasons............Im taking care of my mom at home on Hospice, I have a handicap son, and financially, things are just not good right now.


ANSWER: No, you're not starting over.  This has nothing to do with the discharge you've already obtained and you cannot add new debts.   YOU NEED TO CONSULT WITH AND HIRE AN ATTORNEY to help you with this.  The paralegal is by law prohibited from giving you legal advice of any kind (right or wrong).

http://www.bklaw.com/

---------- FOLLOW-UP ----------

QUESTION: Ok I understand about my second question. How about filing a BK13 and include the loans in there? Is this possible? Or would it be better to re open the 2005 case?
Im sorry, Im unable to afford counsel at this time. But I do APPRECIATE your answers.

Answer
Yes, you could file a Chapter 13 now assuming you qualify under the debt and income limits, but if you have the ability to propose a repayment plan in a Chapter 13, that is going to work against you somewhat in proving the necessary elements for an undue hardship discharge.

At the very least you should have a consultation with a qualified bankruptcy attorney in your area to go over all your relevant information and guide you appropriately.  It's really beyond the scope of this service to do that.