wtf? Putting student loans on credit cards and defaulting

[dullard]

The closest thing I saw of that was a graduate student from Russia. When he had a month to go to finish his master's degree, he racked up his credit card. He bought electronic toys. He paid for his one-way ticket back to Moscow. Then, when he got back home, he stopped paying on his American credit cards.

To this day, I can't think of any way that he was harmed in that transaction. He never wanted to return to the US, and even if he did in several decades, they'd never be able to come after him.

 

[Beev]

I have a LOT of student loans right now, mostly stemming from poor decisions in my past. My payrate is very mediocre and I really can't even pay all my loans every month, but the thought of cheating the system like that just makes me sick 🙁

 

[bignateyk]

Isn't it obvious to a judge and the credit system when people do something like this? Why can't we just send people to prison for doing it? Isn't there such a thing as bankruptcy fraud?

I'm all for putting people like this in prison for the rest of their natural born lives. There should be mandatory jail time in any bankruptcy case. If you wanna start over with a clean slate, fine, but you can go to prison for a while to think about what you did wrong, and how you might want to try a little harder next time. Don't want to go to prison? Then pay your fucking money back.

 

[IceBergSLiM]

7 years of bankruptcy on your credit or 30 years of loan repayment....hmmm

 

[CPA]

Originally posted by: venkman

Originally posted by: Tooncesthedrivingcat
dude... I have closed loans for people with BKs 5 years ago.

BK doesn't kill you as much as people want to think.

5 years ago is a lot different than today though. Were the new bankruptcy laws even in place back then?

The new bankruptcy laws have been in place for at least 5 years. So I think the answer would be yes.

 

[CPA]

Originally posted by: venkman

Originally posted by: SuperjetMatt

Originally posted by: venkman

Originally posted by: Tooncesthedrivingcat
dude... I have closed loans for people with BKs 5 years ago.

BK doesn't kill you as much as people want to think.

5 years ago is a lot different than today though. Were the new bankruptcy laws even in place back then?

What do the new bankruptcy laws have to do with this?

A bankruptcy comes off your record after ten years.
Many people are able to get into mortgages a few years after a Chapter 7 or 13, especially with a decent down payment.
A bankruptcy is supposed to be a fresh start, not a death sentence.

That said, the scenario with student loans you mentioned reeks of Douchebags Extraordinaires.

I admit some ignorance on the new bankruptcy laws, but I thought they made it MUCH harder to get out of paying and it stayed on your record longer.

You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

 

[Chryso]

Originally posted by: Tweak155

Originally posted by: Wheezer
Obviously people have no idea how important, or hard it is to get a good credit rating once you have it borked up.

it took me 8 years to get my credit back after a bad divorce.....at 25 I had to have my mother co-sign for a loan for a POS car I needed for work...that was pretty bad......who the hell wants to depend on mommy or daddy when they are 25?

I busted my ass to get my credit up into the 800 range and I will never let it drop.

As someone already stated...may employers do a credit check now and that can make or break a job opportunity....in this day and age people need every edge they can get...but hey, if some idiot wants to screw up his/her credit ....less competition in the job market leads to more opportunities for those of us that are responsible.

8 yr marriage that ended before you were 25?

Reading comprehension for the lose.

 

[Gibson486]

I am so lost.....


Why would you pay pff debt by making even more debt that is at a higher interest rate? What do you mean you cannot default on a student loan? It is very possible to do so.

 

[SuperjetMatt]

Originally posted by: Lifted
The way it used to work.

Go to bankruptcy court, perhaps the 10 - 20 banks you had credit cards with sent a lawyer, perhaps they didn't. If no lawyers (as was usually the case if you only owe < 10k on each card and have no job or low paying job) then judge looks over the application, MAYBE asks you a question or two (to which you answer "yes i am a loser" or "yes i have a big gambling problem"), and bingo, you're bankrupt. Wait 1 year and credit card offers start rolling in all over again.

Gee, wonder why so many banks went under.

That's still how it works.

 

[Beev]

Originally posted by: CPA
You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

I'm pretty sure it's much, MUCH harder than that for student loans. I don't know why, but for some reason student loans aren't easy to get rid of, when really, they should be easier to get out of.

 

[SuperjetMatt]

Originally posted by: CPA

Originally posted by: venkman

Originally posted by: Tooncesthedrivingcat
dude... I have closed loans for people with BKs 5 years ago.

BK doesn't kill you as much as people want to think.

5 years ago is a lot different than today though. Were the new bankruptcy laws even in place back then?

The new bankruptcy laws have been in place for at least 5 years. So I think the answer would be yes.

They have been in place for a little over two years.

 

[SuperjetMatt]

Originally posted by: Beev

Originally posted by: CPA
You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

I'm pretty sure it's much, MUCH harder than that for student loans. I don't know why, but for some reason student loans aren't easy to get rid of, when really, they should be easier to get out of.

You CANNOT discharge student loans. They cannot be discharged via bankruptcy.

 

[Gibson486]

Originally posted by: SuperjetMatt

Originally posted by: Beev

Originally posted by: CPA
You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

I'm pretty sure it's much, MUCH harder than that for student loans. I don't know why, but for some reason student loans aren't easy to get rid of, when really, they should be easier to get out of.

You CANNOT discharge student loans. They cannot be discharged via bankruptcy.

sure you can, it's called death😉

 

[RichardE]

Originally posted by: bignateyk
Isn't it obvious to a judge and the credit system when people do something like this? Why can't we just send people to prison for doing it? Isn't there such a thing as bankruptcy fraud?

I'm all for putting people like this in prison for the rest of their natural born lives. There should be mandatory jail time in any bankruptcy case. If you wanna start over with a clean slate, fine, but you can go to prison for a while to think about what you did wrong, and how you might want to try a little harder next time. Don't want to go to prison? Then pay your fucking money back.

How will they get a job once they are out? There is a reason debtors prison was abolished along with the stocks.

 

[Wreckem]

Originally posted by: SuperjetMatt

Originally posted by: Beev

Originally posted by: CPA
You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

I'm pretty sure it's much, MUCH harder than that for student loans. I don't know why, but for some reason student loans aren't easy to get rid of, when really, they should be easier to get out of.

You CANNOT discharge student loans. They cannot be discharged via bankruptcy.

You can not discharge federal student loans. Private student loans you would be able to.

 

[Wreckem]

Originally posted by: Gibson486
I am so lost.....


Why would you pay pff debt by making even more debt that is at a higher interest rate? What do you mean you cannot default on a student loan? It is very possible to do so.

If you default on a federal or state student loan, they quickly slap wage garnishments on you.

 

[Beev]

Originally posted by: SuperjetMatt

Originally posted by: Beev

Originally posted by: CPA
You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

I'm pretty sure it's much, MUCH harder than that for student loans. I don't know why, but for some reason student loans aren't easy to get rid of, when really, they should be easier to get out of.

You CANNOT discharge student loans. They cannot be discharged via bankruptcy.

Exactly, when it should be easier to discharge them.

 

[Wreckem]

Originally posted by: Beev

Originally posted by: CPA
You still only need to show that you cannot pay. What college kid or recent college grad can't show that?

I'm pretty sure it's much, MUCH harder than that for student loans. I don't know why, but for some reason student loans aren't easy to get rid of, when really, they should be easier to get out of.

Student loans are totally unsecured, and worse for banks they are guranteed by the govt so people with poor or no credit can get them. They have the highest default rates of any type of loan. They definately SHOULD NOT be easier to get out of.

 

[bignateyk]

Originally posted by: RichardE

Originally posted by: bignateyk
Isn't it obvious to a judge and the credit system when people do something like this? Why can't we just send people to prison for doing it? Isn't there such a thing as bankruptcy fraud?

I'm all for putting people like this in prison for the rest of their natural born lives. There should be mandatory jail time in any bankruptcy case. If you wanna start over with a clean slate, fine, but you can go to prison for a while to think about what you did wrong, and how you might want to try a little harder next time. Don't want to go to prison? Then pay your fucking money back.

How will they get a job once they are out? There is a reason debtors prison was abolished along with the stocks.

Make it so that once you get out of prison there is absolutely no record of your bankruptcy or prison term. (obviously only for these financial cases. having a record of prison for any kind of violent crime is a good thing)

 

[stag3]

rofl @ going to prison for doing this. i paid my student loans off last year
but this is genius! finally a use for those stupid cc checks they send every other
goddamn day.

 

[waggy]

Originally posted by: lokiju

Originally posted by: frostedflakes
Why do people always have to try to game the system? What happened to integrity? :|

Here's a perfect example of that.

It amazes me how many people want to get out of what they knowingly signed up for.

there was also the thread of the idiot trying to skip out on rent. i couldnt find ti.

both were around the same time.


it does make me sick. i work my ass off and don't buy stuff i can't afford. yet people who do it get away with it and get more. then i get to pay for the company's getting bailed out.

 

[venkman]

Originally posted by: Gibson486
I am so lost.....


Why would you pay pff debt by making even more debt that is at a higher interest rate? What do you mean you cannot default on a student loan? It is very possible to do so.

Because you, legally, cannot walk away from the student loan debt. The gov't will get you one way or the other (wage garnishment, ss garnishment, tax return garnishment, etc). If you pay of the Govt loans with unsecured loans you get from Citibank in the form of a Credit Card balance transfer, then the government obligations are met.

Now, you can declare bankruptcy on the credit cards and not have to pay Citibank.

 

[HardcoreRobot]

govt should get out of the business of being a lender

federal subsidized college education has caused demand and tution to skyrocket

im all for scholarships, but the fed has no business getting involved

 

[Baltazar325]

Originally posted by: SuperjetMatt

Originally posted by: Naustica
In Florida, you get to keep your house in bankruptcy. Why do you think OJ had his house in Florida?

I very seriously doubt that you can get out of secured debt while keeping the secured part (house).
Further, bankruptcy law is federal, not state law.

You can reaffirm debt if you choose to. That means you get to keep paying on it.
Anything you don't pay on will be repossessed.

BK law is Federal but the exemption laws are based on state law. I believe Florida has 100% homestead Exemption. That basically means that you can file a CH7 and keep your home even if it has a million in equity.

The new BK laws didnt really make it harder to file. The numbers show that we have more filings today than we did in 05 when they changed the laws.

Assuming these people waited 90 days or so, it wouldnt an automatic presumption of abuse. The Trustee may have questions about it though.

 

[Baltazar325]

Originally posted by: CPA

Originally posted by: venkman

Originally posted by: Tooncesthedrivingcat
dude... I have closed loans for people with BKs 5 years ago.

BK doesn't kill you as much as people want to think.

5 years ago is a lot different than today though. Were the new bankruptcy laws even in place back then?

The new bankruptcy laws have been in place for at least 5 years. So I think the answer would be yes.

They went into place in October 2005.