Questions you have before making a decision to go Bankrupt and the Bankruptcy process

Moderators: TalbotWoods, JaneClack

By j marsh
#1535 I'd be very interested if anyone in this forum has heard of anyone with an 'old type' student loan (ie: one taken out before 1998) who went bankrupt after July 1st this year, and was allowed to have the student loan included in their bankruptcy (and therefore written off when the bankruptcy was discharged).

I ask this because I went bankrupt in August in order to clear my student loan debt. The Higher Education Act came into force on July 1st, and this was meant to exempt all student loans from bankruptcy, but it was badly worded and had to be 'fixed' by a statutory instrument (SI2004/2041), published at the beginning of August and coming into force on September 1st).

Its explanatory notes (you can see them on ... 042041.htm) seem to state clearly that all student loans can be cleared by bankruptcy if the bankruptcy occurs after the loan was received, and the bankruptcy occurs before September 1st 2004.

So I went ahead with my bankruptcy, only to be told that because my loan was the pre-1998 type, it won't be cleared this way.

I'm now casting about for a way of challenging this in the courts, but it would be heartening in the meantime if, as I say, anyone in this forum can tell me of anyone who's been successful, and had a pre-1998 loan included in a bankruptcy occurring after July 1st 2004.
By normske
#1686 Hi J,

I went bankrupt on the 5th of July this year after many meetings with the CAB. I was told 2 weeks later by the OR that my student loan was not included. They told me that this has happened to quite a number of people. I have been in touch with the IS office and they insist they knew nothing until 7/7/04 and told me to get in touch with the Dfes.
He also informed the CAB so they could have this info on their systems.

The Dfes have basically turned round and said all the agencies including CAB and IS shoud have known about this in advance as it was widely publicised. Funny, I searched through the internet before I went BR and could find nothing.

I spoke to my OR yesterday and he said they are still going to push my student loan through on my petetion and see what happens.

Meanwhile the Students Loan Co will keep threatening court action (although what can they really do?). I've offered them £10 a month to keep them at bay until this is resloved

I hope something happens on this as the whole point of going BR was to
have a 'fresh start'. You must be as gutted as I am.