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  1. #1
    Join Date
    Apr 2009

    Default Student Loans, Private Loans, Chapter 7, Post Nuptials

    My question involves collection proceedings in the State of: NY

    Ok Lots of good information here and thanks to all of those who take the time to post answers. I’ve a few questions but all are related to my student loan debt.

    I’ve about 100K in student loan debt that is default.

    70K is in loans from the State of Alaska that are NOT federally guaranteed. They are “supplemental” loans made by the Alaska Student Loan Corporation. (Again these are not federally guaranteed).

    30K (25K principal/interest and 5K collection fees) is owed to the Federal Government though various subsidized and unsubsidized loans that were consolidated back in 2005.

    I did not finish my degree and have had employment difficulties, I’ve been severely under employed or unemployed for the last 2.5 years. I get sporadic income from projects I do (self employment) earning about 7K last year, plus an additional 600 a month in veterans disability payments.

    I’ve been giving thought to trying to go the road of an adversary proceeding and trying to argue the criteria for undue hardship in a chapter 7 (pro se). Sorry, I’m a tad long winded… to the question:

    • The Alaska Loans are not federally guaranteed, so are these considered private loans for the statute of limitations?

    • The Alaska Student Loan Corporation has, from my research, been able to use the eleventh amendment to avoid discharges in Federal courts. Does that mean it has to be discharged in an Alaska court?

    • Will a postnuptial protect her and her earnings from being considered in a chapter 7? We met while I lived overseas and she is concerned as a recent immigrant what this will do to her ability to “obtain the American dream” as this year she had to file “injured spouse” to get her tax refund. (All debt was incurred long before we met)

    • About 8 month ago I sent letters (return receipt & copies on file) to all of the loan originators and creditors requesting an income contingent repayment plan, none addressed it in their replies. Does this show good faith re: the three prongs of Brunner.

    I’d appreciate any answers or thoughts you all may have out there.


  2. #2

    Default Re: Student Loans, Private Loans, Chapter 7, Post Nuptials

    As to the private student loans, the $70k, the forum state's SOL or the place where you reside will most likely govern. In New York, they have a 6 year statute of limitations. You'd have to look at your notes to see if there is a choice of law provision that states Alaska law applies. Most likely, you'd find something like Ohio law applies because it has a 15 year statute of limitations. New York, however, views statute of limitations as procedural, and will not use choice of law provisions to determine the proper SOL. They will just use their own SOL, which is 6 years. However an argument could be made to use the shorter 3 year Alasaka SOL (if that's the contract's choice of law), but it would be unlikely that they would import a longer SOL.

    Your wife will get her refunds intercepted until the DOE debt is paid off and yes, it will behoove her to file an innocent spouse request. Her wages and specific assets, however, are not garnishable. She could buy a house in her own name without your debt following her.

    A bankruptcy petition is not a suit against the state for 11th Amendment purposes when the "state" is a state guarantee agency. In other words, the state guarantee agency is not exempt from a hardship claim---but you would still need to prove hardship and...well....good luck.

    Any reason why you can't finish up your degree? Can you get an associates degree at least?

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