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Residence > scholar Loan Servicing > fifth Circuit Joins the Growing Crowd Holding that Private scholar Loans May be Dischargeable in Bankruptcy

The Fifth Circuit’s present choice in Crocker v. Navient Options is really a stark reminder to for-profit pupil loan providers and servicers that bankruptcy caselaw will continue to evolve relating to discharge. In Crocker, the Fifth Circuit joined up with the trend of instances keeping that personal student education loans are dischargeable in bankruptcy. More particularly, the court affirmed a bankruptcy choice by the Southern District of Texas that personal academic loans aren’t statutorily excepted from release, missing undue difficulty (or in other words, it held that such loans could be released like other financial obligation).

The situation included two specific chapter 7 bankruptcy filings in numerous jurisdictions. The very first filing included a debtor whom obtained a $15,000 loan from Navient possibilities, a for-profit general general general public firm loan provider perhaps perhaps maybe not element of any loan program that is governmental. More