# Student-Loan Defaults **URL:** \ **Category:** Factual Questions\ **Created:** [July 14, 2012, 3:36pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210 "2012-07-14T15:36:52Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![MPB\_in\_Salt\_Lake](https://avatars.discourse-cdn.com/v4/letter/m/c0e974/32.png) [@MPB\_in\_Salt\_Lake](https://boards.straightdope.com/u/MPB_in_Salt_Lake)\ **Post date:** [July 18, 2012, 3:52am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/21 "2012-07-18T03:52:40Z")
> [@Siam\_Sam](#): > > So far, there’s no hard information, and I’m guessing he may just slip through the cracks. He should, of course, pay his loans, but believe me, one encounters much worse than loan defaulters over here. 15 or 20 years ago, I think you would have been right, but these days I wouldn’t count on it. Can he have someone from the US call a consulate and ask a “hypothetical” question? I agree with what you said earlier about him probably not getting arrested at JFK, (or whatever airport he would fly into), but getting slapped with a civil summons seems very possible. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [July 18, 2012, 3:58am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/22 "2012-07-18T03:58:38Z")
If he hasn’t called himself by now, he’s probably worried that it will get the staff there to thinking about the matter. I’m not sure how paranoid he is about this. And I’m not sure if calling is even a viable option these days. Before our own trip to the US in April, the wife called the embassy just to make sure she was still supposed to bring both her new and old passports. (She has a new Thai passport, and the US does not transfer visas into new passports like the Thais do for me; she’s just supposed to bring along her old expired passport that contains the visa.) But they would not connect her to anyone. Instead, she was told to look at the Faq page on the embassy website for any questions she may have. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [July 18, 2012, 4:08am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/23 "2012-07-18T04:08:16Z")
> [@md2000](#): > > When the US government made it impossible to clear student loans by bankruptcy, was that retroactive or on future loans? It’s always been difficult (it’s not impossible) to discharge loans backed by the Department of Education in bankruptcy. The 2005 amendment applied the same rules to private loans. It’s retroactive in the sense that it applies to any bankruptcy proceeding filed after October 2007. ---
**Author:** ![md2000](https://avatars.discourse-cdn.com/v4/letter/m/73ab20/32.png) [@md2000](https://boards.straightdope.com/u/md2000)\ **Post date:** [July 18, 2012, 12:46pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/24 "2012-07-18T12:46:11Z")
> [@Siam\_Sam](#): > > But he would _not_ have been deported. This would be considered solely a matter between my friend and his country. He’d have to leave, yes, but it’s not quite “deported” per se. He would be considered the same as anyone else whose passport expires and must leave, but Thailand would have absolutely no problem with him coming back on a valid passport. Deportation occurs when you run afoul of Thai law, such as by overstaying your visa or engaging in criminal activity. I doubt the US government would bother to inform the Thai authorities that his passport would not be renewed. If he did stay, he would be discovered the first time he encountered officialdom in any form; _then_ he would be deported. However, I can assure you my friend does not have the wherewithal to stay here without a valid passport, and he would indeed leave on his own accord before his present passport expired. I’m not quite sure how familiar you are with international matters. > > Anyway, let’s leave the realm of fantasy. Does anyone have a good idea of what he can actually expect when he shows up at the embassy? We’ll find out soon anyway, but I thought I would ask. So far, there’s no hard information, and I’m guessing he may just slip through the cracks. He should, of course, pay his loans, but believe me, one encounters much worse than loan defaulters over here. Sorry, I was just enumerating the options: Apply for a passport, get denied; -overstay until discovered (not good) -go home in time (no travel until debt payed off) -find a way to stay permanently, or to get alternative travel documents IANAL, don’t know particularly, but… from a different thread, nobody gets thrown in jail for debt; you get jailed for contempt of court, where you went to court, were ordered to do such-and-such, and failed to meet those conditions. (Usually related to paying child support). So assuming there was no active court case about his debt before he left, the only bad thing is that he still owes money and can be hounded for it. So my wild-assed guess is that he will return to the USA, and will find he has zero credit history other than the overdue debt, if he’s been away a few years. I hope he can find a job and a place to live. When he pays off the debt, and the state department records are updated to reflect that, he can get a passport again. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [July 18, 2012, 1:46pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/25 "2012-07-18T13:46:48Z")
> [@Really\_Not\_All\_That\_Bright](#): > > It’s always been difficult (it’s not impossible) to discharge loans backed by the Department of Education in bankruptcy. The 2005 amendment applied the same rules to private loans. It’s retroactive in the sense that it applies to any bankruptcy proceeding filed after October 2007. That should say October 2005. ---
**Author:** ![Gray\_Ghost](https://avatars.discourse-cdn.com/v4/letter/g/c0e974/32.png) [@Gray\_Ghost](https://boards.straightdope.com/u/Gray_Ghost)\ **Post date:** [July 18, 2012, 2:45pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/26 "2012-07-18T14:45:37Z")
I don’t believe this has been mentioned yet in the thread. As usual: I’m not a lawyer, you aren’t my client, and this isn’t legal advice. You should talk to a licensed attorney who handles these matters if you have a substantive question about the law. Your rights may expire if you do not promptly consult with an attorney. All that said… A section of the Code of Federal Regulations dealing with passports is [Title 22, Section 51 (Passports)](http://law.justia.com/cfr/title22/22-1.0.1.6.33.html). Denial of passports is covered in Section [51.70.](http://law.justia.com/cfr/title22/22-1.0.1.6.33.html#22:1.0.1.6.33.5.5.1). Child support arrears are explicitly mentioned as a reason for passport denial (subsection 8), but I don’t see Federal student loans anywhere in the section. There are subsections dealing with “applicant not repaying loans to the United States,” but those are specific types of loans (repatriation, emergency medical care) , not Federal student loans. At least that’s how I read that section. Again, IANAL. I do not know whether there’s another section in the CFR that explicitly covers student loan default as a reason for passport application suspension/denial. ---
**Author:** ![Gray\_Ghost](https://avatars.discourse-cdn.com/v4/letter/g/c0e974/32.png) [@Gray\_Ghost](https://boards.straightdope.com/u/Gray_Ghost)\ **Post date:** [July 18, 2012, 2:57pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/27 "2012-07-18T14:57:51Z")
O.K. ignore my previous message. The justia links are garbage. Here’s the GPO CFR links you want. [22 CFR 51](http://www.gpo.gov/fdsys/pkg/CFR-2012-title22-vol1/pdf/CFR-2012-title22-vol1-part51.pdf)[22 CFR 51.60.](http://www.gpo.gov/fdsys/pkg/CFR-2012-title22-vol1/pdf/CFR-2012-title22-vol1-sec51-60.pdf) (denial of passports) [22 CFR 51.62](http://www.gpo.gov/fdsys/pkg/CFR-2012-title22-vol1/pdf/CFR-2012-title22-vol1-sec51-62.pdf) (other section dealing with revoking a passport) Again though, I don’t see anything in all that verbiage having to do with default on a Federal student loan disqualifying one from receiving a U.S. passport. Knowing the CFR, it’s probably tucked away in the Treasury Regs. Or Fisheries… Doesn’t the Doper **Eva Luna** handle immigration matters in her job? ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [July 19, 2012, 4:18am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/28 "2012-07-19T04:18:49Z")
> [@md2000](#): > > Sorry, I was just enumerating the options: No worries. I saw him last night and suggested the phone call. He thinks he’ll try that and see what they say. If the results are not dire, he might apply by the end of this month. I’ll keep you guys posted. I’m getting more curious about this myself. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [July 25, 2012, 2:40am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/29 "2012-07-25T02:40:14Z")
So an update: He didn’t want to call the embassy but instead e-mailed via a (non-American) friend’s account the embassy’s American Citizen Services section. He was told that defaulting on student loans will not prevent him from submitting an application. Hmmm. Not exactly what he was asking. What he wanted to know was how that application would be treated once submitted. But he’s got an appointment to submit it later this week, so we’ll see soon. Renewing passports is pretty quick over here despite all of them being done back in the US these days. Took only two weeks for me 10 years ago and just nine days this past May. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [August 30, 2012, 4:04pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/30 "2012-08-30T16:04:29Z")
So to finish the story, my buddy did get his passport renewed and will fly to the US late next month. I doubt he’ll encounter any trouble at Immigration if he wasn’t flagged at the embassy. ---
**Author:** ![handsomeharry](https://avatars.discourse-cdn.com/v4/letter/h/e9c0ed/32.png) [@handsomeharry](https://boards.straightdope.com/u/handsomeharry)\ **Post date:** [August 31, 2012, 11:09am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/31 "2012-08-31T11:09:22Z")
> [@Siam\_Sam](#): > > I doubt he’ll encounter any trouble at Immigration if he wasn’t flagged at the embassy. Am I the only person who read this as “…flogged at the embassy”? hh BTW, **Siam Sam,** thanks for keeping us updated. ---
**Author:** ![Olentzero](https://avatars.discourse-cdn.com/v4/letter/o/90ced4/32.png) [@Olentzero](https://boards.straightdope.com/u/Olentzero)\ **Post date:** [August 31, 2012, 11:31am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/32 "2012-08-31T11:31:37Z")
Just as anecdata, I’m in your friend’s situation on a still-valid US passport and went home for a month in June and July. No one even said “boo” to me at US Customs outside the standard questions. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [August 31, 2012, 4:16pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/33 "2012-08-31T16:16:27Z")
> [@Olentzero](#): > > Just as anecdata, I’m in your friend’s situation on a still-valid US passport and went home for a month in June and July. No one even said “boo” to me at US Customs outside the standard questions. Yeah, I figured that would be the case. I figure if there’s going to be any trouble, it will be during passport renewal or maybe even just requesting services at an embassy. But I’ve read that student-loan defaults are up and threaten to be the next big crisis bubble. I wonder how many students would have to default to overhaul the collections system. ---
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [August 31, 2012, 6:39pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/34 "2012-08-31T18:39:59Z")
Just to correct a few misconceptions upthread: > [@](#): > > When … checking into hotels, [passports are] commonly asked for, but that’s just because no one expects a farang (Westerner) to have a Thai driver’s license. I do, and it usually does the trick. Still have to show the passport – and a work permit – to open a bank account. > > I also carry a photocopy of my passport in case the police stop me and want to see it. They never have, but one hears stories. No one is clear on the law either. It is definitely the law that Thais must carry ID at all times, but whether foreigners are also required to is a matter of contention. From what I can tell, there is no law that says foreigners have to carry ID. Hotels here are required by law to inspect foreigners’ passports. An exception may be made if you check in under the name of a Thai national accompanying you. A foreigner does not need a work permit to open a bank account here. That wouldn’t work out since most foreigners on retirement visas keep a sizable amount in their (single-name) Thai bank account to qualify for the visa, and the retirement visa precludes a work permit! I don’t know either whether foreigners are required to carry passports at all times, but I’ve heard credible accounts of arrests for the failure. I keep my passport in my car’s glove compartment now due to one cop insisting he’d arrest me if he stopped me again without it. … [humorous anecdote] My Mother was visiting when he made the threat; the next day I had to run an errand and grabbed a passport quickly from the drawer. The same cop did indeed stop me, spent some time examining the passport, then let me go. Later I looked at the passport – I’d accidentally taken my Mother’s instead of my own! :smack: ---
**Author:** ![md2000](https://avatars.discourse-cdn.com/v4/letter/m/73ab20/32.png) [@md2000](https://boards.straightdope.com/u/md2000)\ **Post date:** [August 31, 2012, 7:21pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/35 "2012-08-31T19:21:44Z")
> [@septimus](#): > > Just to correct a few misconceptions upthread: > > Hotels here are required by law to inspect foreigners’ passports. An exception may be made if you check in under the name of a Thai national accompanying you. > > A foreigner does not need a work permit to open a bank account here. That wouldn’t work out since most foreigners on retirement visas keep a sizable amount in their (single-name) Thai bank account to qualify for the visa, and the retirement visa precludes a work permit! > > I don’t know either whether foreigners are required to carry passports at all times, but I’ve heard credible accounts of arrests for the failure. I keep my passport in my car’s glove compartment now due to one cop insisting he’d arrest me if he stopped me again without it. … [humorous anecdote] My Mother was visiting when he made the threat; the next day I had to run an errand and grabbed a passport quickly from the drawer. The same cop did indeed stop me, spent some time examining the passport, then let me go. Later I looked at the passport – I’d accidentally taken my Mother’s instead of my own! :smack: How likely is it that a random street policeman (not a fancy bureacrat) would be able to read roman characters and English? Or understand how likely those crazy foreigners are to change hair styles since they got their passport? 🙂 == No surprise, I guess at this point they haven’t come down on passport issuing for student loan default since it’s not something most Americans need to do or regularly do. I suppose there’s more “bang for buck” on going after income tax refunds, drivers licenses, etc. ---
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [August 31, 2012, 8:24pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/36 "2012-08-31T20:24:42Z")
> [@md2000](#): > > How likely is it that a random street policeman (not a fancy bureacrat) would be able to read roman characters and English? Or understand how likely those crazy foreigners are to change hair styles since they got their passport? 🙂 Most Thais can read a little English. I am male, look different from my Mom, have different hair color and hair length, etc. It really was amazing! Most cops who can’t read English will wave a foreigner on rather than embarrass themselves. Anyway, that cop was new. Most know me (my kids go to school with their kids, etc.) and indeed have been very helpful on some occasions. ---
**Author:** ![Eva\_Luna](https://avatars.discourse-cdn.com/v4/letter/e/e495f1/32.png) [@Eva\_Luna](https://boards.straightdope.com/u/Eva_Luna)\ **Post date:** [August 31, 2012, 8:50pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/37 "2012-08-31T20:50:36Z")
> [@Gray\_Ghost](#): > > Doesn’t the Doper **Eva Luna** handle immigration matters in her job? I only provide very basic info on applying for U.S. passports (mostly because once people become U.S. citizens, they are supposed to enter and depart the U.S. on a U.S. passport, regardless of any other citizenship they may hold, and sometimes it becomes a timing issue if they have travel planned shortly after naturalizing). I’ve never run into this situation. My firm mostly gets people to the point where they are eligible to apply for U.S. passports, and the rest is up to them. Eva Luna, Immigration Paralegal ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [August 31, 2012, 11:41pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/38 "2012-08-31T23:41:52Z")
> [@septimus](#): > > Hotels here are required by law to inspect foreigners’ passports. An exception may be made if you check in under the name of a Thai national accompanying you. > > A foreigner does not need a work permit to open a bank account here. That wouldn’t work out since most foreigners on retirement visas keep a sizable amount in their (single-name) Thai bank account to qualify for the visa, and the retirement visa precludes a work permit! > > I don’t know either whether foreigners are required to carry passports at all times, but I’ve heard credible accounts of arrests for the failure. I keep my passport in my car’s glove compartment now due to one cop insisting he’d arrest me if he stopped me again without it. … [humorous anecdote] My Mother was visiting when he made the threat; the next day I had to run an errand and grabbed a passport quickly from the drawer. The same cop did indeed stop me, spent some time examining the passport, then let me go. Later I looked at the passport – I’d accidentally taken my Mother’s instead of my own! :smack: Hotels may be required by law to inspect a foreigner’s passport, but I’ve not seen one here yet who would take other than my driver’s license if that’s what I waved at them. In fact, I believe the law is still on the books that they must turn in a list of all foreigners on their premises to the local police station every single day, but I’ve not heard of this actually being done. If you don’t have a retirement visa, you’re not going to be able to open a bank account without a work permit. Perhaps it’s a little looser upcountry. I’ve then been able only to show my driver’s license for transactions if I choose. There is no law requiring foreigners to carry passports at all times, but as I already said, the police themselves do not understand this. If they run you in, their superiors are not going to admit a mistake was made. ---
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [September 1, 2012, 5:51am UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/39 "2012-09-01T05:51:11Z")
> [@Siam\_Sam](#): > > If you don’t have a retirement visa, you’re not going to be able to open a bank account without a work permit. Perhaps it’s a little looser upcountry. You’re correct that different bank branches enforce rules differently, but your notion even a work permit or retirement visa is required is laughable on its face. (I think a non-immigrant visa _may_ be a requirement, though I’ve opened accounts without one.) As I stated already, _most_ (not all) foreigners who obtain a retirement visa use, as their proof of finances, **a Thai bank account in their name which has been open for at least two months**. “Open for at least two months” _before_ obtaining the retirement visa? “Need retirement visa to open a bank account”? You do the math!! (There _are_ Thai laws which seem nonsensically circular, but this isn’t one of them. Until recently you needed the account for _three_ months before getting the retirment visa which _did_ create an inconvenient circularity: The entry on the non-I visa needed to open the account would expire when you were finally allowed to apply for retirement visa. :smack: ) ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [September 1, 2012, 1:02pm UTC](https://boards.straightdope.com/t/student-loan-defaults/628210/40 "2012-09-01T13:02:45Z")
You can laugh all you want, but I’ve had to show a work permit for each and every account I’ve ever opened, including my most recent one of a few months ago. But suit yourself. [Previous page](https://boards.straightdope.com/t/student-loan-defaults/628210.md?page=1)