Economic Stimulus Check Seized to Pay Student Loans
By Kent Anderson, Oregon Bankruptcy Attorney on Jun 9, 2008 in Bankruptcy Cases & Legislation
This twist on an economic boondoggle came to the attention of one of my part time legal assistants, who also works as a volunteer substance abuse counselor to low-income people. If you look at the fine print concerning economic stimulus checks, it does mention that they will be subject to tax refund intercepts, including those to offset delinquent student loans.
It is anyone’s guess how many stimulus checks are being diverted in this manner. The number is probably substantial. The economic stimulus value of all this money, diverted into the pockets of lenders, is highly questionable.
My assistant’s acquaintance’s sole source of support is Social Security disability income for a mental condition of at least a decade’s standing. Currently homeless, he’d planned to use his stimulus check as a payment on a dilapidated travel trailer parked behind a gas station, so he’d have a roof over his head. He might qualify for a hardship discharge of the student loan, if he could find an attorney to take on a complicated case without any possibility of payment.
Then again, he might come up against the wrong combination of court and lender, and be told his circumstances did not present the required standard of certainty of hopelessness.
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