Debtors

Regular readers of this blog know that you cannot discharge student loan obligations through bankruptcy absent a showing of undue hardship. If you go broke borrowing money for expensive cars, houses, and monkeys/butlers, no problem, file for bankruptcy and start over. But if you go broke trying to better yourself through education, the government will make you beg and prove that you are sad and hopeless. Wonderful system we’ve got here.

We’ve also talked about how many people who might be eligible for undue hardship on their student debts don’t even try. The system is daunting and complicated, and I’ve argued that prostrating yourself in front of a bankruptcy court and letting them invade your life to the point of telling you how much you should be spending on your cell phone is not something that comes naturally to people with pride and dignity. This might be hard to understand for people who have never been in this situation, but I’d much rather be a “deadbeat” and have my wages garnished with the discretion on how I spend the rest than have some old judge tell me how much money I should be spending on breakfast.

When trying to get your debts discharged through bankruptcy, there seems to be no limit to what a judge can take into account to see if you are really desperate. But a recent Ninth Circuit opinion upholding a discharge by reversing the district court put one boundary on what a court can look at to determine if you’ve tried to pay your debts in “good faith.”

The court can’t look at your household and suggest that you pimp out your wife. So at least that’s something…

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Ed. note: Gradenfreude is a new series chronicling a recent law school graduate’s life after attending an unranked school. Feel free to email the author at TristanTaylorThomas@gmail.com, and he’ll respond ASAP. After all, it’s not like he has anything better to do.

Hello my loyal readers — oh, and you commenters, too. A lot has happened since we last met. I had a job interview last week. How did it go, you ask? The words embarrassing and atrocious come to mind. Think about getting mugged on the way to your car, getting a flat tire in the rain, and then having your credit card declined at McDonald’s. Yeah, that would have been a much better day than I had.

Looking back at the day as a whole, I really should have known that it was going to be a bad time. First, my power went out in the middle of the night, but luckily for me, I was so excited and nervous that I woke up every couple of hours and noticed early on that I needed to turn on my cell phone alarm to make sure that I woke up. But then, of course, I couldn’t go back to sleep because my anxiety level was at an all-time high.

While I lay in bed and waited for my alarm to go off, I practiced going over interview questions in my head. My alarm finally went off, and I felt like I did before most of my law school exams: “Oh sh*t, I am not nearly prepared for this. Why the hell did I do this again?”

double red triangle arrows Continue reading “Gradenfreude: My Interview Horror Story (Or, How I Underwhelmed A Hiring Partner With My Law Degree)”

In the past few months, those involved in legal academia have been going back and forth over whether the cost of law school tuition is “too damn high.” Many would argue that it is, considering the fact that even during the height of the recession, some law schools instituted across the board tuition hikes. Even now, when repeated calls have been made for reduced class sizes, law school tuition continues to rise to make up for the lost revenue those additional students would have provided.

This problem, they say, needs to be remedied immediately — before the law school tuition bubble pops — so that we can avoid additional problems down the line. Because after all, as my colleague Elie Mystal noted in 2010, “Law school tuition might be recession proof, but student debt repayment is not.”

If we continue on this way, we may be looking at some pretty scary numbers in the future….

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Ed. note: Gradenfreude is a new series chronicling a recent law school graduate’s life after attending an unranked school. Feel free to email the author at TristanTaylorThomas@gmail.com, and he’ll respond ASAP. After all, it’s not like he has anything better to do.

Whoever said, “No news is good news,” obviously wasn’t dealing with trying to find a legal job in this economy. I really wish that there was anything remotely resembling news to report on my legal aspirations, but the only thing that I’ve accomplished is mastering drinking my worries away.

This experience has made me realize that when you’re constantly trying to get something that you really want, but not having success, it’s easy to begin to doubt yourself and your abilities. Then, as a result, it’s possible that you may lower your expectations because the fear of failure takes over. But what can be really interesting is how the little things in life can change your expectations.

I’ve always been a superstitious person, and along with that, I believe that the world often gives you signs. Okay, I bet you think that sounds dumb. Well, what makes it worse is that I take my signs from fortune cookies. Before going to law school, I got a fortune cookie that said, “You are about to begin a prosperous business venture.” CHA-CHING!!! What else could you possibly need to know before taking on colossal debt?

A fortune cookie would never steer me wrong, would it?

double red triangle arrows Continue reading “Gradenfreude: Living Life By Fortune Cookies — Bad Idea Or Worst Idea?”

Ed. note: Gradenfreude is a new series chronicling a recent law school graduate’s life after attending an unranked school. Feel free to email the author at TristanTaylorThomas@gmail.com, and he’ll respond ASAP. After all, it’s not like he has anything better to do.

When you are unhappy with your job, you have to take joy in the simpler things in life. For me, sometimes that’s just kicking back and enjoying a relaxing evening of good television. Yes, I have a television, but I also live in my parents’ house, so technically, it’s their television. Whatever.

I planned on watching TV on Sunday night, but unfortunately, something that was said at work stuck with me. During one of my breaks this week, where I sat in a windowless back room with less natural light than a prison, I met a new employee who recently graduated from college, and we were exchanging job-search horror stories. A fellow coworker walked in and overheard me talking to about how much my current job sucked, and he retorted, “Oh, the plight of a law school graduate in 2012.”

That completely ruined my night — so much so that, when at the end of the latest episode of “The Simpsons” the characters asked viewers to submit their own ideas for the opening “couch gag,” my mind instantly went to Lisa reenacting the quest of going to law school, and the life that it can lead to in today’s economy.

This is what I submitted….

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Chris Danzig here. If you read Above the Law, well, ever, you know that we are deeply concerned about the burden of law school loan debt facing many young lawyers. The general consensus at ATL — vocalized most frequently by Elie and Staci, who each have firsthand experience with six-figure loan debt — is to avoid law school entirely, or at least know what you’re getting yourself into (and STFU when bill collectors come calling).

Occasionally, we hear about unusual approaches to dealing with debt that are undertaken by entrepreneurial — or outrageously bold, depending on your perspective — lawyers or law students. Crowdsourcing seems to be one of the new strategies.

Today, we heard from a 30-year-old graduate of an elite law school who is still living with his parents. He has turned to the internet for help paying off his loans.

I think he may be onto something, but my colleague Staci doesn’t exactly agree….

double red triangle arrows Continue reading “ATL Debate: Should This Graduate Of A Top Law School Solicit Donations To Pay Off His Student Loan Debt?”

Should you go to law school? Is it worth the debt? These are reader questions that we encounter (and answer) all the time, but now that mainstream media sources have caught on to the fact that law schools are facing an existential crisis of sorts, they’re all beating the same drum we’ve been beating for years here at ATL.

You may remember David Segal’s popular series on law schools that ran in the New York Times. The Wall Street Journal has also churned out many articles detailing much of the same subject matter. Now, another reputable news source is running a series called Remake America, which covers the gamut of “issues and challenges affecting millions of Americans.” Apparently one of those issues is whether going to law school is worth the debt associated with the degree.

And let me tell you we were shocked, just shocked, to find out the recent college graduate asking for assistance had absolutely no idea how much loan debt she might incur if she enrolled in law school….

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After going through this week’s entries for Comment of the Week, it seems that many of our commenters really want an Above the Law T-shirt. There was some stiff competition (what up, Richard Brosner?), but in the end, we decided to address a topic that’s germane to anyone who has taken out a loan to attend law school.

Over Labor Day weekend, the New York Times had an interesting article about the apparent “ease” with which one can get student loan debt discharged through bankruptcy. And by “ease,” we mean that there’s a whopping 39% chance that you’ll receive a full or partial discharge, but only if you can show that you’re a lost cause to society without any semblance of dignity or hope for the future. Easy, right?

Well, actually, yeah. Because when you’ve got six figures of law school loan debt hanging over your head for a degree that you thought was going to be marketable and you’ve resigned yourself to a job as a sandwich artist at Subway just to make a buck, you’re going to lose hope pretty quickly.

And that’s exactly why our Comment of the Week was just so damn appropriate….

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This may sound like advice coming from a broken record, but in case you are somehow still unaware of this very important fact, you generally cannot discharge your law school loan debt in bankruptcy. Sure, there’s an “undue hardship” exception to this steadfast rule, but it’s a difficult standard to meet.

The government will go to the ends of the earth to prove that you are capable of paying back what you owe and just unwilling to do so. To be frank, you’d probably be better off becoming totally and permanently disabled or dying, because then you or your estate would only have the ensuing tax nightmare to deal with.

Judges know that the burden of “undue hardship” is a difficult one to prove, and most of them probably think that it’s a load of crap. Unfortunately, most of them are unwilling to say so. But not this Oregon judge — she launched into a pointed, four-page critique of legal education, while ruling on a law school debtor’s attempt to discharge his student loans in bankruptcy.

No, she won’t grant you a discharge, but that doesn’t mean she has to like it. You know it’s going to be good when a judge cites to Above the Law while discussing student loans….

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* In case you’ve been sleeping under a rock, Mitt Romney picked Rep. Paul Ryan as his Vice Presidential running mate. Putting politics aside, this is a great pick, if only because Ryan is so handsome. Seriously, he’s a total stud. [Wall Street Journal]

* “How can I be the one guy with a good degree who is going to be chronically unemployed?” Sadly, many lawyers are still looking for jobs after (multiple) layoffs, but thanks to a lack of positions, employment is just “not in the cards” for them. [New York Times]

* Deadliest clerkship? The Washington, D.C. judge who presided over one of the most violent mass shooting cases in the nation’s capital was reportedly held up at gunpoint last week, with her law clerk in tow. [Fox DC]

* Something is rotten in the state of Denmark Texas. Judge Sam Sparks “know[s] the smell of bad fish,” and now wants to know why the USADA waited so long to bring charges against Lance Armstrong. [Bloomberg]

* After reversing a bankruptcy court’s decision that loan repayment would be an “undue hardship” for a law school debtor, a judge took the time to rip law schools a new one over escalating tuition. [Oregonian]

* Match.com class-action plaintiffs found no love in court after a federal judge ruled that the dating website hadn’t breached its user agreement. Much like their love lives, their claims aren’t getting any action. [Reuters]

* A man who is his own lawyer has a fool for a client: 23% of all cases filed in the federal court for the S.D.N.Y. are brought by pro se litigants, and the vast majority of them seem to have lost their minds. [New York Post]

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