One might think that The New York Times‘ “Your Money” article on a company that offers to swap student debt for mortgage debt is an advertisement, but it’s an alternative to New York bankruptcy worth considering. SoFi, a nonbank lender, with the help of the government mortgage entity Fannie Mae promises student debtors the opportunity …
NYT Discusses Program for Swapping Student Debt for Mortgage Debt Read More »
Back in February, I discussed the surge in student debt “borrower defense” discharge claims. Student debtors discovered an obscure 1995 rule that permitted them to administratively discharge—that is, outside the bankruptcy process—their student loans if they could show that their schools somehow defrauded them. The development occurred just as the for-profit Corinthian Colleges shuttered its …
Education Department Publishes Regulations for ‘Borrower Defense’ Claims Read More »
The Federal Reserve Bank of New York published a fascinating blog post about the 14 percent of U.S. households whose debts exceed their assets. Because a substantial proportion of New York bankruptcy cases involve net debtors, the post illuminates the segment of the country that most likely faces serious financial hardship. One of the chief …
Study: Net Debtors’ Financial Situations Differ Substantially Read More »
The federal government offers Parent PLUS loans to parents of college students to help pay for the students’ educations, but they are notoriously difficult for struggling parent-debtors to deal with because they have high interest rates and aren’t protected by as many of the student-loan innovations that keep regular direct-loan borrowers afloat, e.g. Income-Based Repayment …
Much reporting on college education or student loans confuses or misleads audiences. One source that’s been particularly outspoken in the last couple months, The Wall Street Journal, ran a few articles worrying about the large sums of federal student loans going unrepaid, perhaps $200 billion. It’s a serious issue, but it’s important that student-loan debtors …
Don’t Confuse Your Student-Loan Problems With the Government’s Read More »
A few years ago, I discussed how the federal government changed its process for allowing qualifying debtors to apply for a non-bankruptcy discharge their student loans due to disability. Until 2013, the process required disabled debtors to slog through a bureaucratic process, even if the Social Security Administration had independently judged them as “totally and …
Government Reaching Out to Disabled Student-Loan Debtors Read More »
It’s understandable that young Americans would not want to take out even more debt to purchase a home after the housing bust led to a wave of New York bankruptcy filings and foreclosures. Indeed, according to a 2014 Federal Reserve Bank of New York study, the number one reason a group of renters gave for …
Is Debt or Income Preventing Young Americans From Buying Homes? Read More »
Two bankruptcy cases made the news in March that will be of interest to New York bankruptcy debtors. One of them was even a Brooklyn bankruptcy. The first case appeared in the Boston Globe. Echoing my post on the economic risk calculator, a debtor earned $165,000 annually as president of a manufacturing company and borrowed …
Bankruptcy Courts: Parent PLUS Loans Stay, Bar-Exam Loans Go Read More »
The Federal Reserve Bank of New York regularly produces interesting analyses of consumer credit, and recently it’s blogged about how patterns in consumer debt behavior have shifted for both younger and older demographics between 2003 and 2015. Its findings have some implications for economic growth, young student-loan borrowers specifically, and possible trends in New York …
A few weeks back, the Washington Center for Equitable Growth (WCEG) continued its geographic study of student-loan debt, this time focusing on debtors’ races. Because of the fraught path to discharging student loans in bankruptcy, falling behind on loan payments can disqualify debtors from helpful protections like income-based repayment programs. Consequently, when the WCEG found …
Student-Loan Delinquencies Fall Hardest on Middle-Income Minorities Read More »
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