student loan debt Archives - Page 10 of 10

Lawsuit Filed Against Betsy DeVos for Failure to Cancel Defrauded Students’ Debt

Posted on June 28, 2019by Admin

More than 150,000 student loan borrowers have filed a lawsuit against the U.S. Dept. of Education and Education Secretary Betsy DeVos alleging they are being deprived of student loan debt forgiveness they are rightfully entitled to. The lawsuit accuses the Department of Education of failing to implement an Obama-era regulation known as “borrower defense, ” which allows students to have their federal student loans cancelled if their school misled them or engaged in other misconduct.

The attorney representing the Plaintiffs in the case say, “The law is clear: Students who experienced fraud should not be required to pay back federal loans that should never have been made by the Department in the first place.”

Borrower Defense Applications continue to pour in, but it has been reported that the Dept. of Education has not approved or denied a claim since June 2018. The majority of the complaints concern “for-profit” schools, of which there are some 7,000 around the country, which take in around 15% of government financial aid.

Last year, a federal judge ruled that DeVos’ delays of the borrower defense protections were unlawful. Still, the agency continues to neglect the applications.

Click here to read more on this story.

For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

student loan debt

A Growing Number of Bankruptcy Filings Are Being Driven by Student Loan Debt

Posted on June 25, 2019by Admin

Student loan debt is playing a large part in many recent bankruptcy filings, according to a recent study from LendEDU. According to their data, 32 percent of people filing for Chapter 7 bankruptcy report having some amount of student loan debt, showing that student loan debt is definitely a growing concern when it comes to consumers considering filing for bankruptcy.

LendEDU reported that, of this 32 percent of total consumers, student loan debt made up almost half of their total average debt. The student loan debt crisis is said to be reaching an all-time high with the total national amount exceeding $1.5 trillion.

According to the Student Loan Hero, the average undergraduate student leaves with $29,800 in student loan debt. This figure does not even begin to consider those students who must take out more loans to pay for necessary expenses or other students who continue with graduate studies. Many of these students end up carrying six figures of student loan debt after graduation.

The data reported by LendEDU only covers filers who are pursuing a Chapter 7 bankruptcy and not a Chapter 13 bankruptcy, which is an option that offers a restructuring of debt over the course of three to five years.

This LendEDU study points to an even bigger problem involving the burden student loan debt places on young consumers. Many of them struggle with keeping up with basic living expenses, on top of their student loan obligations, which makes it very easy for them to fall behind in payments. Eventually, many of these borrowers feel they have no other choice but to declare bankruptcy to pay them off. The bankruptcy may not end up discharging their loans, but it will erase other debt that makes it hard for them to continue paying their obligations. Student loans are normally non-dischargeable in bankruptcy cases, which is a large part of the problem.

Taking these facts into consideration, this would mean that if the people surveyed by LendEDU who fall in the 32 percent carrying student loan debt, they will only receive partial relief through the average bankruptcy case. If 49 percent of their debt is still considered non-dischargeable, that is still a large sum to continue paying following a bankruptcy discharge.

Borrowers must prove that paying their loans would be an undue financial burden, a legal standard which has traditionally been very difficult to meet. Movement is being made towards possibly fixing this issue by allowing student loan debt to be treated just like any other unsecured debt in a bankruptcy case.

Source: https://www.businessinsider.com/people-filing-for-personal-bankruptcy-carry-student-loan-debt-2019-6

Debt Relief, student loan debt, Student Loans, Uncategorized

$5.3 Million in Student Loan Debt Canceled as Part of the ITT Tech National Lawsuit Settlement

Posted on June 19, 2019by Admin

Hundreds of Pennsylvania students who attended the now-bankrupt ITT Technical Institute will receive $5.3 million in student loan debt relief as part of a national settlement. Pennsylvania Attorney General Josh Shaprio said 570 former ITT students will have their student loan debt canceled as part of a multi-state settlement.

“With the private student loan program that ITT and CUSO established, ITT Tech was able to take advantage of thousands of hardworking students who were simply trying to complete their education,” Shapiro said in a statement.

The national settlement provides $168 million for more than 18,000 students harmed by abusive lending practices. ITT Tech targeted “low income” students who could not afford to pay tuition out of pocket and relied on federal loans to pay for school, according the settlement. A coalition of 44 states reached a settlement with Student CU Connect CUSO LLC, which was managing the loans for ITT.

ITT Tech had more than 136 campuses in 38 states when it shut down in September 2016. This $600 million settlement cancels all the student loan debt owed to the school.

The agreement specifically deals with student borrowers who attended ITT Tech between the years 2006 and 2016. The settlement also returns $3 million to students who made payments on their loan to the school after the school’s parent company, ITT Educational declared bankruptcy in 2016.

Click here to read more on this story.

student loan debt

Why Student Loan Debt is Worse for Women

Posted on June 7, 2019by Admin

An estimated $1.46 trillion is owed nationwide in student loan debt, affecting nearly 44 million borrowers. However, nearly two-thirds of those borrowers are women, owing a collective $929 billion of the total student loan debt, according to a recent report issued by the American Association of University Women (AAUW). Of these female borrowers, a large percentage of them are women of color.

The AAUW report also showed that the amount of student loan debt women graduate with is more than the average debt carried by their male counterparts. A woman graduating with a bachelor’s degree leaves with $21,619 in undergraduate student loans while a male student leaves with $18,880 in student loans. The AAUW report also showed that it takes women two years longer than men to pay off their student loans. Black and Hispanic women were reported as taking longer to pay off their student debt.

One of the reasons given for the disparity in time it takes women to pay off student loans has to do with the gender pay gap, as well as childcare issues. A female borrower may have to take time off work after having children or work only part-time, which would make it understandable if she took longer to pay off student loans than a male borrower. These issues of pay and childcare also seem to affect minority women more than others, which could also be a leading cause for why this group of borrowers takes even longer to pay off their loans.

According to figures from PayScale.com, women make 79 cents for every dollar a man makes. Even if a female borrower does not take time off to have children, she is at a disadvantage to her male counterparts when it comes to paying off loans. The lack of affordable, quality childcare also presents an issue, especially for minority women, which also contributes to the disparity in how long times these borrowers to pay off their loans.

To help offset these issues, many grants and scholarship programs are available for female undergraduate students. However, these programs only go so far and will only help those students who are either aware of these programs or have the resources to apply for them.

Please click here to read more.

Bankruptcy Law, Debt Relief, student loan debt, Student Loans

Possible Solutions to the Student Loan Debt Crisis

Posted on June 5, 2019by Admin

With more than $1.5 trillion in student loan debt owed nationwide, it can be safe to say that the student loan crisis has reached a breaking point. For lawmakers, one solution to bring change to this problem is allowing student loan debt to be discharged in bankruptcy court.

Another measure that has received a great deal of public support is Senator Elizabeth Warren’s proposal to completely wipe out the majority of America’s student loan debt through a loan forgiveness program. Her proposal has received support from other presidential hopefuls, including Senators Bernie Sanders, Kamala Harris, and Amy Klobuchar, as well as Representative Eric Swallwell, all of whom are co-sponsoring it.

Recently, the American Bankruptcy Institute’s recommendations to allow student loan debt to be discharged in bankruptcy were published.

The average college student graduates with about $30,000 in student loans. This number does not include those students who pursue a master’s or post-graduate degree. Many of those students end up owing six figures in student loan debt.

The burden these loans present to young graduates is intense and can even follow them into retirement. Outstanding student loan debt can affect a person’s job in 13 states. To keep up with loan payments, many borrowers have accumulated credit card debt, just to be able to afford basic living expenses.

Student loans, while not impossible to discharge in bankruptcy, are extremely difficult to eliminate in a Chapter 7 or Chapter 13 bankruptcy case. Other obligations may be eliminated at the end of the case, but the student loan ones will stay with the borrower even after other obligations are discharged.

Bankruptcy courts use the “undue hardship” test to determine whether a filer should have his or her student loan debt discharged, but no set standard has ever been made on what qualifies as an undue hardship, making it very difficult to ever receive relief. New bi-partisan legislation has been introduced and proposes regulations that ensure student loan debt is treated like other forms of consumer debt in bankruptcy, meaning it can be easier to discharge.

Without the ability to discharge the largest amount of debt many bankruptcy filers are carrying; these individuals will never be able to receive the fresh start bankruptcy is meant to give them. While this change may not completely solve the student loan crisis, many financial experts are hopeful it can be a catalyst for change.

Click here to read more on this story.

Bankruptcy Law, student loan debt, Student Loans

Senior Student Loan Debt a Growing Trend

Posted on May 24, 2019by Admin

We are all aware of the effects student loan debt has on the Millennial generation, but many are unaware of the effects it has had on the senior population. According to a recent CBS News Report, seniors account for a growing number of student loan borrowers. For seniors who fall behind on their student loan payments, the government can garnish their social security.

According to Forbes data, senior student loan debt has increased 71.5% in the last five years. To date, seniors ages 60 to 69 owe a total of $85.4 billion in student debt. The reasons behind the increase in debt:

Seniors who have taken out loans to go back to school to increase their job prospects;
Seniors who have taken out loans for their children or grandchildren to go to college or graduate school. Parent PLUS loans come with a fixed interest rate of 7.6%

Seniors can see their Social Security benefits garnished at a rate of 15% to pay off student loans in default, according to recent report from AARP. It also notes that in 2015 alone, almost 114,000 student debtors ages 50 and older had some of their Social Security benefits seized to repay overdue federal student loans, which are subject to garnishment. Many of these funds were seized from disability benefits, not Social Security benefits paid out beyond the age of 62.

Some options to consider for anyone struggling with student loan debt (including seniors) include: Income driven repayment plans, graduated payment plans, extended repayment plans or refinancing your student loan debt.

Click here to read more on this story.

For Florida seniors who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.