Wednesday, November 22, 2017

Debtor Wins Discharge of Student Loan Debt

Think the private loan you have for education is an educational loan?  You may want to have an attorney review it after a recent decision.

Yolande E. Essangui v. SLF V-2015 Trust, et al., Adversary No.16-00201,
Main case 16-12984

The issue before the Court is whether a private loan extended for educational purposes is dischargeable in a debtor’s chapter 7 case. There are three (3) subsections addressing educational debt that is excepted from discharge.  Apparently the argument was centered on which of the 3 sections is applicable in determining the loans dischargeability.  Based on the facts of this case, the Court held that the private student loan at issue is not an educational benefit, as it did not qualify for federal student loan assistance.  The Court entered an Order granting the debtor’s motion for summary judgment and denying the defendant’s motion for summary judgment.

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