Monday
Jun152009
Three Years Too Late for United Student Aid Fund
Monday, June 15, 2009 at 11:26AM
Today the Supreme Court announced it will hear the case of United Student Aid Fund v. Espinosa. The case involves a question about procedures an individual most go through in order to reduce student loan debt as part of a bankruptcy proceeding.
Espinosa filed for Chapter 13 and the bankruptcy judge was able to reduce his loans from $17,823.15 to $13,250. The Fund received notice of this plan and did not make any objections to it.
Three years after Espinosa’s filed for bankruptcy, the Fund claimed that Espinosa still needed to pay back the original loan of $17,823.15. The Fund claims that they were allowed to revisit Espinosa’s case and ask for full payment because Espinosa never initiated a court hearing to settle the loan, but instead just asked the bankruptcy judge to reduce the amount.
Judge Kozinski, who wrote the opinion for the 9th Circuit, said that the Fund should have taken the opportunity to object to Espinosa’s bankruptcy plan when the Fund received notice three years ago.
The court will likely hear the case in November.
Espinosa filed for Chapter 13 and the bankruptcy judge was able to reduce his loans from $17,823.15 to $13,250. The Fund received notice of this plan and did not make any objections to it.
Three years after Espinosa’s filed for bankruptcy, the Fund claimed that Espinosa still needed to pay back the original loan of $17,823.15. The Fund claims that they were allowed to revisit Espinosa’s case and ask for full payment because Espinosa never initiated a court hearing to settle the loan, but instead just asked the bankruptcy judge to reduce the amount.
Judge Kozinski, who wrote the opinion for the 9th Circuit, said that the Fund should have taken the opportunity to object to Espinosa’s bankruptcy plan when the Fund received notice three years ago.
The court will likely hear the case in November.
College Will Soon Be Cheaper, More Accessible, Says Education Secretary
Secretary of Education Arne Duncan touted recent changes to the education system Tuesday after President Barack Obama signed the Health Care and Education Reconciliation Act.
Duncan, who spoke with reporters in a conference call, pointed to the expansion of Pell Grants as a major change and stressed that it will make college drastically cheaper and more accessible.
“Students are going to receive more Pell Grants,” said Duncan. “You can literally going to school for free with these Pell Grants.”
Duncan also explained that Americans who choose a career in public service will receive benefits.
"If you go into public service... after 10 years of public service work, all of your debt will be forgiven.”
Director of the Domestic Policy Council Melody Barnes, who joined Duncan in Tuesday's call, outlined the Obama administration's long-term aim for education.
“[President Obama's] goal is that the nation should graduate the highest proportion of college graduates in the world by the year 2020,” Barnes said.