My cousin asked me this question yesterday but i dont know the answer. So, here i am on answers, LOL. so anyway, she is in the process of geting all of her bills together so that she can file but she is afriad that if she puts the debt that she owes the college on the bankrupcey that she wont be able to use the credits at the same school or maybe even having them released. long story short she is afraid of losing her credits.
2007-03-07 08:06:49 · 4 answers · asked by ZZZ>>>>ARA!!! 1 in Business & Finance ➔ Personal Finance
Some colleges hold up credits when tuition is not paid. However, tuition, as opposed to "student loans" are dischargeable in bankruptcy and there is no reason or justification to hold up or not release credits as a result of bankruptcy.
2007-03-07 11:25:39 · answer #1 · answered by DLeibowitz 5 · 0⤊ 0⤋
Student loan debt cannot be erased with bankruptcy--she will still owe that money no matter what she ever does. It may be the same with direct debt to a college.
I don't know what you mean about credits. If you are referring to tax credits, the school doesn't 'release' those; you just claim them on your taxes by stating how much you paid in tuition. You have to prove you paid by having an invoice marked "paid"--so if you OWE money (ie you haven't paid the school) then you don't get to claim a tax credit. And no, bankruptcy doesn't get in the way of claiming those credits, to my knowledge.
If you're referring to a trascript or other proof of education (like a diploma), then the school probably will not release that to you or an employer until they are paid. If bankruptcy wipes away that debt (which I don't think it will) then it will be as if you paid them, and they'll have to release those documents to you.
But your cousin has much bigger financial concerns than that! Bankruptcy will ruin her credit for at least 7 years, making it difficult for her to get a good job, rent an apartment, or borrow any money at all.
2007-03-07 17:26:56 · answer #2 · answered by lizzgeorge 4 · 0⤊ 0⤋
Your transcripts will be held if your college tuition is not paid. I believe it is very difficult to relieve yourself from student loans. So, if you have grants, it should not matter. If you are one of the very few who are able to prove a need to include student loans in your stay of relief, then I presume the college could keep transcript records.
2007-03-07 16:19:51 · answer #3 · answered by Heather 2 · 0⤊ 0⤋
I really don't think so, but her best bet is to ask the bankrupsy lawyer. if it does she does not have to claim that. on her bankrupsy.
2007-03-07 16:19:20 · answer #4 · answered by misty blue 6 · 0⤊ 0⤋