QUESTION
Can a student loan company charge late fees and make my account past due during an automatic stay?
Asked on Sep 13th, 2013 on Bankruptcy - Indiana
More details to this question:
In April 2013 I filed for Chapter 7 in on (July 2013) I was granted my bankruptcy discharge letter. After I received my bankruptcy discharge notice and promptly contacted SallieMae to inform them that my bankruptcy automatic stay had ended and I wanted to be able to access my account so that I could start making my monthly payments. They had not yet received the notice from the court about bankruptcy status. I contacted them again beginning this moth to see what was going on and was able to finally get access to my account information on September 12, 2013 only to find out that some of my loans are 123 days past due. My loans were not in default ( $0 past due balance) before I received my automatic stay. I contacted them right after getting my letter of discharge. (August 1, 2013) I was not able to obtain any payment information about the balance due for any of my loans until (September 12, 2013) I know that interest would still accrue on the unpaid balance.
1 ANSWER
Bankruptcy Attorney serving Burbank, CA
Partner at
Law Office of Mark J. Markus
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3 Awards
Yes, unfortunately. Because student loan debts are not dischargeable, if you do not stay current with the payments, whether you're in a bankruptcy case or not, the student loan creditor can charge late fees and declare a default of the loan, unless you seek and obtain an undue hardship discharge from the bankruptcy court (in which case the student loan company can still charge late fees, etc., but the debt would be discharged).
Mark Markus has been practicing exclusively bankruptcy law in California since 1991. He is a Certified Specialist in Bankruptcy Law by the State Bar of California Board of Legal Specialization, AV-Rated by martindale.com, and A+ rated by the Better Business Bureau.
Answered on Sep 17th, 2013 at 1:31 PM