Separate category of Student Loan Debt in Chapter 13

Separate category of Student Loan Debt in Chapter 13

Under Bankruptcy Code § 1322(b)(5), a Chapter 13 plan may enable upkeep of re re payments for claims upon that your payment that is last due following the date on which the ultimate re payment beneath the plan flow from. Since a Chapter 13 plan cannot go beyond 5 years, the last re re payment on student loans that are most are going to be due following the Chapter 13 plan is completed. Hence, this element of the Bankruptcy Code would appear to enable a debtor to carry on to help make student that is regular re payments straight to the lending company, outside the plan. The main benefit of performing this is that the debtor would remain present on both the main and interest for the education loan, while during the exact same time repaying other creditors through the Chapter 13 plan.

Nonetheless, § 1322(b)(1) states that a Chapter 13 plan might designate split classes of unsecured claims, but only when the program doesn’t discriminate unfairly against any course. Exactly exactly What constitutes unfair discrimination is a factual matter that needs to be based on the bankruptcy court on an instance by situation foundation.