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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.

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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

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.

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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.

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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.

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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.