TILA Bankruptcy

Hello Paul,

Thanks for the quick and informed response to my post!

Another question: Since TILA deals with many loans, I wonder if it also applies to student loans. Since private lenders have gotten into the act of lending to students, it seems that it would. Though it shouldn’t matter if the loan was from a government source or private–TILA should still apply.

I take it from your last post (and from the bankruptcy ruling you posted) that these TILA violations would allow through rescission for mortgage debt to be discharged through bankruptcy–even a Chapter 7. Would a bankruptcy attorney know this?

Again, terrific site. Thank you for your contribution to the little guys–I believe that credit is the basis for one’s financial health and you are a balm to the broken!

Leela

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Hi Leela,

Student loans insured or guaranteed by the government are exempted from the TILA.  Non-federal student loans are not exempt.

TILA claims can be raised in federal or state court.  TIL actions may also be brought in federal bankruptcy court and since bankruptcy court may generally be more sympathetic towards consumers, it is my hope that all bankruptcy attorneys would be familiar with the Truth in Lending Act.

Thanks for the questions and only God is a true balm to the broken.

Paul

Psa 51:17 The sacrifices of God [are] a broken spirit: a broken and a contrite heart, O God, thou wilt not despise.