Consumer complaint received 2017-12-19
Company: MOHELA
State: CA
Product: Student loan
Sub-product: Private student loan
Issue: Struggling to repay your loan
Sub-issue: Can't get other flexible options for repaying your loan

Complaint:
Good evening, 

Please see below responses to the Student aid foundation, they are not being cooperative.  I do also have the bankruptcy I can attached, should you request it.  

XXXX I understand that you believe the student loan was not forgiven because you are unable to find evidence of an Adversary Proceeding.  I want to make it clear, the courts have allowed a student loan/education loan to be discharged without an Adversary Proceeding and the bankruptcy court does have the power to approve a discharge without an Adversary Proceeding.

Though the bankruptcy court does choose to use the process of an Adversary Proceeding to determine discharge on MOST of its cases, it doesn't ALWAYS use this process.  It is up to the courts to determine discharge, how the determination is done still rest in the courts "Bankruptcy Judge" hands.  

With my particular case, the bankruptcy judge did approve the discharge of all listed debts under my chapter 7 bankruptcy .  The trustee specifically listed my debt total INCLUDING the student loans as approved to be discharged in bankruptcy and His Honor approved.   I have offered up the information, both with the schedule of debt listed, the trustees comments, and the Judges order stating relief ordered.  

I have also offered a court case showing, that in rare cases and advisory proceeding is not required, should the bankruptcy court make that determination, specifically siting that the lack of undue hardship (advisary proceeding) doe's NOT limit the bankruptcy court's jurisdiction over student loan debts. 

XXXX XXXX XXXX XXXX, Inc. v. XXXX under the opinion of the court it was stated "We are not persuaded that a failure to find undue hardship in accordance with 523 (a)(8) is on par with the jurisdictional and notice failings that define void judgments that qualify for relief under Rule 60 (b)(4).  As noted,  523 (a)(8) does not limit the bankruptcy court's jurisdiction over student loan debts. "  

The student loan, for which you on behalf of Department of Education are refusing to adhere to court orders, was consolidated from a XXXX XXXX XXXX, from a school which was not accredited at the time of loan origination.  Further more, you have been unable to provide me with original form of indebtedness from loan origination in XX/XX/XXXX - XX/XX/XXXX.  This loan was clearly discharged in bankruptcy, and your refusal to listen to court orders can and will find you in contempt.  

The fines for contempt of court do vary, however, my letters explaining to you exactly what and why my loans were approved to be discharged by the court will do nicely to help His Honor see I have exhausted all avenues before requesting further help from the courts. 

At this point, I will await one more further response from your department.  

My next step will be to reopen my bankruptcy case and file a motion requesting to find Federal Student Aid an Office of the Department of Education, and Mohela in contempt of court, for which the court will decide the level of severity and distress you, acting on behalf of Department of Education, and Mohela have caused since XX/XX/XXXX.  I will also provide the credit report showing that my credit was affected by your refusal to respect His Honors original order for relief.  Further more your misuse of power & authority for a loan that was consolidated from XXXX College a college that lost its accreditation from XX/XX/XXXX - XX/XX/XXXX  has proven that Department of Education needs more checks and balances outside of themselves to provide an unbiased opinion and to follow courts orders. This particular loan started at $XXXX now with interest and refusal to follow the courts orders the Department of Educations has listed this loan over $11,000.00, damaging my ability for a fresh start, for witch the bankruptcy court have already approved. 

I have hoped to resolve this without requesting the courts help, and I will wait 2 more weeks before filing the motion, with a series of documentation requesting the courts help with overseeing their order.  

The date I will file will be XX/XX/XXXX allowing you  enough time to follow the courts decision on your own accord. 

Sincerely, 

XX/XX/XXXX





From: Student Aid Feedback 
To: "XX/XX/XXXX"  
Sent: Tuesday, XX/XX/XXXX XXXX XXXX
Subject: Resolved, Complaint Case Number: XXXX [ ref:XXXX ]


XX/XX/XXXX

Dear XXXX XXXX:

Thank you for contacting the U.S. Department of Education's office of Federal Student Aid. We have reviewed your complaint XXXX regarding Federal Aid Repayment-Loan Discharge, Cancellation, or Forgiveness.

The following actions were taken on your behalf: 

We researched your account again based on the documentation that you submitted for review on XX/XX/XXXX. 

Proper documentation would show that you filed an Adversary Proceeding in the Bankruptcy Court and that the Court, as part of the Adversary Proceeding, entered an order discharging the student loans. We looked in PACER and you never filed an Adversary Proceeding. This is why your federal student loans were never discharged. 

Thank you for providing feedback to the U.S. Department of Education's office of Federal Student Aid. However after taking these actions, we have closed your case. 


Sincerely,






ref:XXXX


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Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation