If my girlfriend received debt summons for school loans, what do we do?

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If my girlfriend received debt summons for school loans, what do we do?

My girlfriend received a summons for a school loan debt. It seems she neglected to deal with the issue. Times are tough for both of us right now and she’s only 29. I don’t think declaring bankruptcy would be the best move. Could someone help? Would any attorney be interested in barter of some sort? I have a design, branding and web company. Maybe we can help you with something? I can also provide more details of the summons if needed.

Asked on June 14, 2012 under Bankruptcy Law, New York

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Bankruptcy is not even an option for her, unfortunately, if this is a federal backed or guaranteed/insured school loan, as most are: that's because such loans are specifically expempt from discharge in bankruptcy in 99%+ of cases. (To discharge a loan, the filer must plead and show "undue hardship"--which basically means that you have NO ability to pay, since you can't even afford or can just afford the most basic costs of living and also have no reasonable prospect for your situation to improve over time--i.e. no real chance of promotions, getting a second or better job, etc. My understanding is that less than 1% of all filers who claim undue hardship succeed.)

Furthermore, if it is a valid debt--i.e. it's for money she's actually borrowed--there is most likely nothing she can do to fight it. If there was some procedural defect in the service of the summons and complaint--that is, it was not served properly on her--she may be able to get a dismissal with prejudice, but they will simply correct the mistake or error and refile. If she borrowed the money and has not repaid it, then there really are no defenses to liability, other than showing some exceptional circumstances, such as duress or fraud from the school lender. Therefore, a lawyer is not  likely to be of assistance in this situation.

Her best bet is to try to negotiate some payment plan she can make. Your best bet (from a strictly economic viewpoint) is to not marry her and not make any large purchases jointly with her until this situation and her credit are straightened out, otherwise you could suffer consequences from her default.


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