Zuckerberg Bankruptcy Law Office

Here it is a holiday, and the universities and colleges are closed. But what isn't closed for many Hoosiers who graduated years ago is their debt. For them, the best present would be getting out from under their student loans!

It's been almost twenty five years since I began my practice as a bankruptcy attorney in Indiana, and my own student loans are a thing of the distant past. Unfortunately, for many people, it's not that way at all.  If you're wondering why the topic of student loans is so important to me, there are three important reasons why:

First, since all four of my Indiana bankruptcy law offices are located at or near big college towns, one thing people want to talk to me about is student loan debt help.

The Columbus bankruptcy lawyers in my offices there hear questions about student loans by graduates of nearby community colleges and universities, and of course there are thousands of graduates here in Indianapolis needing my advice and student loan debt help.

As every good debt consolidation lawyer knows, student loan debt in Indiana is a big problem. In fact, on a national level, there's been a lot of debate about whether student loans ought to be treated the same way as other consumer debt when it comes to bankruptcy.  However, as things stand now, student loans are almost never dischargeable in bankruptcy.

The second way student loans frequently come up in my work is at meetings with clients who want to share their financial difficulties and have me analyze their situation.  Quite often, even though filing bankruptcy isn't going to reduce their student loan obligations, the bankruptcy results in the forgiveness of other debts, freeing up money to go towards the student loans.

The third reason has to do with the job market in central Indiana.  One of the big employers is Sallie Mae, a company that services student loans. There are some 2,300 Indiana employees of the nation's leading student loan provider.  Some Obama administration proposals would cut out the "middle man" and have student loans be serviced directly through the government, threatening those jobs in our state. Having well-paid employment opportunities is key to rebuilding after individual bankruptcy in Indiana.

There's a crucially important case in the Supreme Court right now, United Student Aid Funds v. Espinosa, and it's a case about student loans.  Last week in this Indiana bankruptcy blog, I shared the basic details of this case with my clients and blog readers, in order to emphasize certain principles about how bankruptcy law works.

According to Oyez U.S. Supreme Court Media, the Espinosa case spotlights two legal questions having to do with bankruptcy law:

 

• If a Chapter 13 bankruptcy court discharges a student loan based on deciding repayment would cause "undue hardship", can that decision be challenged later by a creditor (on the grounds that undue hardship was not proven)?
• Is it sufficient for the bankruptcy court to send a creditor notice by U.S. mail that a student loan has been discharged (or partially discharged), or does the creditor need to be represented at a face to face hearing?

The Supreme Court decision will be very, very important for the student loan industry as well as for students who cannot get the educational training they need in today's job market without the availability of student loans. 

Needless to say, the Supreme Court decision will be very, very important to ME as a board-certified consumer bankruptcy specialist offering student loan debt help!