BANKRUPTCY LAW: Where student debtor receives a pledge of funds from a lender (creditor) or otherwise never actually receives funds from the lender, then that debt is an exception to the general rule of non-dischargeability. In other words, if the student debtor never received actual funds from the creditor, the debt may be discharged (cancelled), without a trial on the burden that the debt causes to the student.
In this case, a “tuition credit” did not constitute “funds received” by the debtor, and therefore, the debt was dischargeable (cancelled in the bankruptcy).
In re Christoff, 527 B.R. 624, 632 (9th Cir. BAP 2015; issued by the Ninth Circuit Bankruptcy Appellate Panel in San Francisco), cited approvingly in In re Yolande E. Essangui, (Debtor), 573 B.R. 614 (Bankruptcy Court for the Maryland District, 2017)
