Re: Internet - Student Bankruptcy
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Posted by Ms. Lawrence
(144.26.126.40) on April 23, 2003 at 21:04:14:
In Reply to: Question About "School FEES" posted by Linda O. on April 23, 2003 at 13:22:36:
I found this on the internet. I think it may apply to the question of schools refusing students admission if they don't pay fees discharged in bankruptcy. I think it was on a college's site but it references bankruptcy laws. Student Tuition and Fees Student Bankruptcy U.S. Bankruptcy Code Sec. 523 If the College receives notice, as a creditor, that a student has filed for bankruptcy, then: 1. Note in student's record and financial aid file that a bankruptcy petition is pending. In the interim, follow the procedures set forth in the following paragraphs 3.a.1) and 3.a.2). 2. File with the court a claim indicating the amount of the student debt to the College, with supporting financial records (i.e., registration form(s), signed deferred payment agreement(s), and accounts receivable record showing any payments made with balance owing). Also, state that the College claims this debt is not dischargeable under 11 USC §523 (a) (8). An example of the claim form is included for your information (Exhibit A). Blank "Proof of Claim" forms are available at each respective U.S. Bankruptcy Court. 3. **If the bankruptcy court specifically grants discharge of the student debt, then the Region should follow the steps described below (a.1) a.2) and b.), and forward a copy of each court order to the College General Counsel. A general order of discharge does not discharge a student loan. a. Make an entry in the student's records and financial aid file of the date of bankruptcy decree, and note that future efforts to collect the debt which violate federal law should not be made, such as: 1. Withholding transcripts or other acts designed to compel the debtor to pay the discharged debt (11 USC §524 a(2), and
2. The College is forbidden from discrimination against bankrupt persons solely on the basis of bankruptcy (11 USC §525).
b. Include the student debt on the next accounts receivable write-off report. 4. If the debt is not specifically discharged by court order, the College is free to pursue collection of the debt against the student, including withholding grades, transcripts, diplomas, admission, etc. Another entry, as a follow-up to 3.a. above, should be made, noting that the debt is a valid one to be pursued. (Refer to SIS B/R Users Manual for system-required entries).
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