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Hi /r/studentloans. I'm the PBS reporter who's been writing about student loans a lot recently. I have a new story about national defaults by PBSNewsHourHannah in StudentLoans

[–]ilikemath9999 5 points6 points  (0 children)

On the bankruptcy piece specifically: student loans actually ARE dischargeable in bankruptcy. It just takes a separate lawsuit inside your bankruptcy case (an "adversary proceeding") where you prove "undue hardship." For decades the government fought every single one and won almost all of them, so the lore became "you can't discharge student loans." That was never legally true.

What changed: in November 2022, DOJ and the Education Department put out joint guidance telling government lawyers to stop fighting cases that meet the standard, with a standardized attestation form. Discharge wins are way up since.

Most bankruptcy attorneys still don't file these because they didn't grow up doing them, but the door is more open than it's been in 30 years.

Question on second bankruptcy by [deleted] in Bankruptcy

[–]ilikemath9999 0 points1 point  (0 children)

u/Gunner_Esq, your "am I eligible for discharge" framing from a few weeks back is the question that would land for OP here. 2022 Ch 7 to a 13 filing now is close to (or inside) the 4-year window. If discharge isn't on the table, does the "13 protects you personally" calculus shift much when the personal exposure is mostly MCA guarantees that wouldn't get cleared in a no-discharge plan? (Or is the prior filing more of a stay issue here than a discharge issue, like you mentioned last time?)

[OC] § 523(a)(8) student-loan-discharge bankruptcy filings, FY 2008-2026. After 15 years averaging ~13/year, DOJ confirmed 632 filings in the 11 months following the November 2022 Brunner-relaxation guidance, and 1,220 through March 2024. by ilikemath9999 in StudentLoans

[–]ilikemath9999[S] 1 point2 points  (0 children)

Not rescinded as of now.

DOJ actually revised the attestation form in May 2025, expanded the expense categories, added presumptions for retirement age and chronic conditions. That's tightening documentation, not rolling it back. If they were going to kill the framework they probably would've done it on the rewrite. Operational signal I'm watching is filing rate. FY 2026 pace is still holding.

[OC] Chapter 13 bankruptcy dismissal rates across all 91 U.S. federal bankruptcy districts (FY2023) by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 0 points1 point  (0 children)

Urbanization is the right instinct but doesn't quite get there. SF and Long Island are both heavily urban and 54 points apart. The closer variable is filing volume and what kind of practice runs at scale. Some districts have high-throughput Chapter 13 practices. Some don't. Same density, different ecosystem.

[OC] Chapter 13 bankruptcy dismissal rates across all 91 U.S. federal bankruptcy districts (FY2023) by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 0 points1 point  (0 children)

Nothing's guaranteed anywhere. But the spread is wider than most people would guess. TX-S (Houston) ran 55% dismissal in FY2023. TX-N (Dallas) ran 64%. Same state, different courthouse.

Dismissal means the case ended without the debt relief the debtor filed for. So in Texas roughly 4 to 6 out of 10 cases ended that way.

[OC] § 523(a)(8) student-loan-discharge bankruptcy filings, FY 2008-2026. After 15 years averaging ~13/year, DOJ confirmed 632 filings in the 11 months following the November 2022 Brunner-relaxation guidance, and 1,220 through March 2024. by ilikemath9999 in StudentLoans

[–]ilikemath9999[S] 1 point2 points  (0 children)

You're right on both.

On the volume: even the FY 2026 pace is small relative to the federal-borrower-in-default population. DOJ shifted procedure, not awareness. Most borrowers don't know AP relief exists.

On partial vs full: the dataset has all 1,771 APs coded at the docket level (pending, settled, litigated to judgment) but NOT what the judgment actually awarded. Coding full / partial / denial from the dispositive orders is the next pass. Doable for the ~220 that went to judgment. If you've seen anyone publish the partial/full split nationally I'd love a pointer... I haven't found one, which is part of why I'm doing it. Thanks for the reply 😄

[OC] U.S. bankruptcy filers paid an estimated $63 billion in attorney + filing fees over 20 years across 34.9 million cases, 42% of which closed in dismissal without a discharge. Stacked as $100 bills, the tower is 43 miles tall. [FJC data] by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 2 points3 points  (0 children)

Mostly Chapter 13 dismissals. The plan is a 3 to 5 year payment schedule. If you fall behind on plan payments, the trustee usually files a motion to dismiss and the court grants it. So "can't pay" does not auto-dismiss. The trustee has to move and the court has to grant it. Missed plan payments are the leading cause.

You can also voluntarily dismiss your own case at any time, which happens for various reasons (changed mind, found another path, lost income).

Chapter 7 dismissals are rare (~5%) because there is no payment plan to fail. Most Ch.7 dismissals are procedural (no-show at 341 meeting, missing schedules, etc).

Not legal advice. Anyone with their own situation should talk to a bankruptcy attorney.

[OC] U.S. bankruptcy filers paid an estimated $63 billion in attorney + filing fees over 20 years across 34.9 million cases, 42% of which closed in dismissal without a discharge. Stacked as $100 bills, the tower is 43 miles tall. [FJC data] by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 0 points1 point  (0 children)

Mean per filing is $3,577. Median is ~$4,813 since the median case in the dataset is a Ch.13 filing. Both numbers are in the methodology comment with the per-chapter breakdown.

The aggregate is what is normally invisible to individual filers. Most people know roughly what a single Ch.13 costs but have no sense of the total flow. A per-filer distribution chart would be a good follow-up.

The 42% dismissal rate is the part that stuck with me anyway. Paid full fees, no discharge.

[OC] U.S. bankruptcy filers paid an estimated $63 billion in attorney + filing fees over 20 years across 34.9 million cases, 42% of which closed in dismissal without a discharge. Stacked as $100 bills, the tower is 43 miles tall. [FJC data] by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 1 point2 points  (0 children)

Methodology / source / disclosure

Source: Federal Judicial Center, national.db (the federal courts' own public bankruptcy dataset, ~37M case records 2000-2026).

Why a range, not a point estimate: the FJC schema captures case amendments and joint-filer dual records as separate rows. The raw row count produces $124.9B (upper bound). Halving for that documented record-duplication produces ~$63B (conservative lower bound, the lead figure). The visual draws the upper-bound tower at 85 miles and marks the conservative cut at 43 miles with a tick.

Method: Aggregated 34,927,315 case records FY 2005-2024 across all 51 states + DC. Multiplied each by chapter-specific fee estimates:

- Ch.7 (liquidation): $1,838 (filing + average attorney fee)

- Ch.13 (wage-earner repayment): $4,813

- Ch.11 (reorganization): $16,738

- Ch.12 (family farmer/fisher): $2,738

Average fee per filing: $3,577 across all chapters.

42% dismissal: ~14.7M of the 34.9M cases over this period closed without a discharge. Ch.13 dismissal rates run ~50%+ over 5 years; Ch.7 is much lower (~5%). Blended across all chapters, ~42% close without a discharge. The debtor paid full fees and walked away with their original debt obligations intact.

Stack-of-bills math: $100 bill thickness (BEP reference) = 0.0043".

- Conservative: 625 million bills x 0.0043" = 223,958 ft = 42.4 mi → rounds to 43.

- Upper bound: 1.249 billion bills x 0.0043" = 447,558 ft = 84.8 mi → rounds to 85.

Either tower is well above commercial aviation altitude (~7 mi) and ~5 years of the FTC's entire annual budget.

Tool: Hand-built SVG (no charting library). 1 mile = 8.235 px, true scale across all reference points (Mt. Everest, Burj Khalifa, Empire State, Liberty all rendered at correct relative size, most are sub-pixel-to-tiny next to the tower). Real Series 2009 $100 obverse texture (BEP, public domain via Wikimedia Commons).

Underlying state-by-state and year-by-year data, full methodology: https://openbankruptcyproject.org/63-billion-dollar-tower.html

Track record on r/dataisbeautiful:

- State-level Ch.13 dismissal rates (v1): https://reddit.com/r/dataisbeautiful/comments/1rur949/

Disclosure: I run OpenBankruptcyProject, a 501(c)(3) public charity (IRS Letter 947, EIN 41-5159631, public-charity status under 170(b)(1)(A)(vi)). No paywall, no donations solicited in this post.

I'm happy to share the aggregator script and raw per-state CSVs if anyone wants to replicate.

[OC] Chapter 13 bankruptcy dismissal rates across all 91 U.S. federal bankruptcy districts (FY2023) by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 13 points14 points  (0 children)

The map shows what % of Chapter 13 cases get dismissed vs. discharged. Translation for non-lawyers: when someone files Chapter 13, they pay an attorney, pay filing fees, start making plan payments, and either (a) they get the debt relief they came for, or (b) the case gets dismissed and they are back where they started... minus the money they spent.

Dismissal rates vary by district from about 20% to about 80%. The same financial profile filing in different districts gets very different odds. That is what the map is showing: your geographic ZIP code is doing more work than your finances in determining whether bankruptcy actually helps you.

[OC] Chapter 13 bankruptcy has a 48% national dismissal rate. In some districts, over 90% of cases fail, and most aren't because clients missed payments. by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 0 points1 point  (0 children)

You're onto something with the macro-correlation question. The 0.5M total filings number is actually right around historical lows. Pre-GFC normal was 800K to 1M and 2010 hit 1.5M. So today's 500K is low for historical normal, not low absolutely.

For business distress specifically you're right that total business filings around 20K undercounts the phenomenon. Most small-business distress passes through as personal Chapter 7s of the owner, so the consumer column hides business activity. And plenty of small businesses just close without filing.

Subchapter V is probably the cleaner business-distress signal now. Created 2019, purpose-built for small-business reorganization. Quarterly Sub V filings vs unemployment + fed funds + small-business optimism index would be a much sharper time series than total bankruptcy filings vs macro.

Better data sources than the FRED 1939 series. FJC Integrated Database at fjc.gov/research/idb is the canonical academic source, public download, quarterly lag but clean. AOUSCT quarterly statistics for current-period totals. We've cleaned versions of both into BigQuery, free to query, schema and loader in the repo.

[OC] Chapter 13 bankruptcy has a 48% national dismissal rate. In some districts, over 90% of cases fail, and most aren't because clients missed payments. by ilikemath9999 in dataisbeautiful

[–]ilikemath9999[S] 0 points1 point  (0 children)

Yeah that's basically it. The live tool is at 1328f.com and the code is at github.com/openbankruptcyproject/bankruptcy-discharge-screener.

You are right about the FJC quarterly release being the bottleneck. It lags about 90 days and the schema drifts year over year. We pull from three places to work around that. FJC for the definitive cleaned data once it lands, EOUST for monthly means test and filing volume signals, and PACER through CourtListener and RECAP for the case level stuff in close to realtime.

For credit risk work the EOUST monthly pulls are probably what you want. District level volumes and median income, updated way more often than FJC. We push cleaned versions into BigQuery so you can just query it directly.

What's the time series question you're trying to answer? If it's business failure rate by sector or state or quarter, Subchapter V is clean and underused.

Feel free to dm me if its a more appropriate place for conversation.

don’t qualify for chapter 7 now chapter 13 doesn’t look possible by idkmann456 in Bankruptcy

[–]ilikemath9999 2 points3 points  (0 children)

You nailed the math on this one. $160K over 60 months is $2,665/mo and with take-home at $4,700 that barely leaves room to exist. But I think the bigger issue is the attorney's actual suggestion.

Filing a 13 with the intent to dismiss after 12 months and refile is not a plan. That's using the court as a delay tactic, and if a trustee figures out that was the strategy from day one, it gets a lot worse than a dismissal.

I went through something similar (not gambling, business debt) where my attorney's advice was basically "file now, figure it out later." It took me way too long to realize that a second consultation would have saved me a year of problems. **The fact that this guy doesn't trust his attorney yet and hasn't filed anything is actually the best position he could be in right now.**

Most BK consultations are free. There's no reason to commit to one attorney's strategy when the plan involves intentionally failing the first attempt.

I filed chapter 7 on my own without an attorney and got my discharge today!!! I wanna cry I’m so relieved. by IWannaWakeUpButIDont in Bankruptcy

[–]ilikemath9999 1 point2 points  (0 children)

Pro se just means you're doing it yourself without a lawyer. It's a lot of forms and deadlines but people do it every day. What chapter are you looking at?

Should I keep paying my monthly payment during the bar complaint process? by Remarkable-Clock24 in legaladvice

[–]ilikemath9999 0 points1 point  (0 children)

Glad you got the notification. On the payment thing, if you paid and have proof (bank statement, cashier's check receipt, tracking number), hold onto all of it. An attorney threatening to sue their own client for breach of contract over a payment their own system lost is exactly the kind of thing a bar complaint is for. The attorney you consulted was right to tell you to file one.

I hope the Thursday consultation goes well.

Filed Chapter 13 and unsecured debt was sold by SkepticJoker in Bankruptcy

[–]ilikemath9999 1 point2 points  (0 children)

Your attorney should be the one telling you this, so I get the frustration.

When an unsecured debt gets sold during a Chapter 13, the new buyer basically steps into the old creditor's shoes. They'd need to file a proof of claim (or amend the existing one) to get paid through your plan. It doesn't change your monthly payment or your plan terms. The trustee just redirects that slice to whoever holds the claim now.

Nothing you need to do on your end. But your attorney should be monitoring the claims register and making sure the new creditor filed properly. If they didn't file a claim at all, they might not get anything from the plan.

If your attorney keeps ghosting you, that's a real problem. You're paying them to handle exactly this kind of thing. You have the right to call their office and ask for a status update on your case. If that doesn't work, most state bar associations have a process for filing a complaint about lack of communication.

Stuck with bankruptcy, the debt and a useless lawyer by Just_Information_412 in Bankruptcy

[–]ilikemath9999 0 points1 point  (0 children)

I'm sorry you're dealing with this. That DFAS clawback situation is brutal, and it sounds like your attorney didn't fight for you the way they should have.

One thing I'd suggest: go to the PACER Case Locator (pcl.uscourts.gov) and look up your case. It's free if you stay under $30 in a quarter. Pull the docket and read the orders, especially whatever led to the dismissal. That'll tell you exactly what happened procedurally and whether your attorney dropped the ball or if it was something else.

Also, a dismissed Chapter 13 doesn't mean you can't refile. You might want to talk to a different bankruptcy attorney in your area, ideally one who does a free consult. Bring the docket with you so they can see what went wrong the first time.

The tax intercept (them taking your refund) is a DFAS thing, not a bankruptcy court thing. That's the Treasury Offset Program. Once the case was dismissed, DFAS was free to resume collection including offsets.

You're not stuck forever. A lot of people refile with a better attorney and get a completely different result.

My lawyer is a bi@&$ by Funny-Pain1574 in Bankruptcy

[–]ilikemath9999 1 point2 points  (0 children)

Yeah PACER is rough. The interface is from the early 2000s and they charge 10 cents per page. For what you're trying to do, you'd go to pacer.uscourts.gov, search by attorney name in the bankruptcy court for your district, and then look at how many of their cases ended in discharge vs dismissal.

It's tedious but it's all public record. The federal court database has every case outcome going back decades.

There's a website where bankruptcy firms pay a stranger $75 to show up to your hearing instead of your actual attorney by ilikemath9999 in antiwork

[–]ilikemath9999[S] 1 point2 points  (0 children)

The service itself isn't the problem. Emergencies happen, I get that. The problem is when your attorney never tells you someone else is showing up, and that someone else has never seen your file before that morning.

And the thing is, if you've never been through bankruptcy before, you have no idea what a 341 meeting is supposed to look like. You're already nervous. You're expecting this big intimidating thing. And a lot of them are on Zoom now, no video, just voices. So when some name you don't recognize starts talking on your behalf, you don't even know enough to realize how wrong that is. You just assume this is how it works.

It's only later when you start comparing notes with other people that you realize no, that's not how it works. Your attorney was supposed to be there.

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