The US Government is Taking Our House Over Student Loans

Question:

Dear Steve,

The DOJ has undone my daughter’s Trust and is putting the house I live in, in my name, so they can lien it to take it- they say I owe $438,000 in student loan debt.

I took out approximately $75k in HEAL and Stafford loans in the 1990s. I’ve already been through for Debtor exams since 2010. My mother made me the beneficiary of her life insurance policy when she died in 2014.

Those funds were used following the Louisiana law which protects them from any creditors, to build the trust which currently owns the house.

However, the government laughed at the state law and ran right over it.

How can I keep from being rendered homeless?

Wendi

The US Government is Taking Our House Over Student Loans

Answer:

Dear Wendi,

Ever since I originally answered your reader question here, I’ve been following the case.

The government position that the court appears to have agreed to is as stated in this court document.

“1. On August 20, 2020, the United States filed a Complaint to Avoid Fraudulent Transfer against Defendants, Wendi L. Laborde and CCLCA Trust. The Complaint alleges that Wendi L. LaBorde engaged in a fraudulent transfer of funds to CCLCA Trust in order to purchase certain real and personal property and evade the Government’s enforcement of a civil judgment against LaBorde. (R. 1).

2. On June 22, 2021, the United States’ First Amended Complaint to Avoid Fraudulent Transfer was entered into the record. (R. 21). This Complaint reiterated the allegations against LaBorde and CCLCA Trust made in the original complaint, but also detailed the transaction history for the purchase of the real property where LaBorde currently resides, municipally known as 79885 Ciego Drive, Bermuda Dunes, California 92203 in Riverside County.

3. After both Defendants were properly served and appeared in the suit, the United States filed a Motion for Summary judgment on October 1, 2021. (R. 26, 26-1, 26-1, 26-3, 26-4, and 26-5). LaBorde filed an Opposition to the Government’s summary judgment motion on October 14, 2021. (R. 28).

4. On March 03, 2022, after consideration of the pleadings and evidence in the record, this Court issued a memorandum ruling granting the United States’ motion for summary judgment. (R. 29).

5. In accordance with its memorandum ruling, the Court issued an order (R. 30) for the following:

a. That the transfer of $485,902.60 by LaBorde to CCLCA Trust be declared fraudulent and voided;

b. That Judgment be entered against the CCLCA Trust in an amount no greater than the amount currently owed to the Government by LaBorde; and

c. That the Ciego Drive Property currently titled in the name of the CCLCA Trust be properly titled in the name of Wendi LaBorde and be subject to the judgment lien in favor of the United States.

6. As of the date of this filing, LaBorde owes $437,152 to the Government. (See Exhibit 1, Declaration of Sheila Still). Accordingly, this is the amount of the judgment that should be entered against CCLCA Trust pursuant to the Court’s Order (R. 30).

7. Additionally, because the Court’s Order affects the title to and Government’s lien against the real property at 79885 Ciego Drive, Bermuda Dunes, California 92203 in Riverside County, the United States requests that the Court order the Clerk to enter final judgment transferring title of that real property from CCLCA Trust to Wendi LaBorde in the form and manner prescribed by Federal Rule of Civil Procedure 79(b).

8. Based on the foregoing, the United States now moves, under Rule 58 of the Federal Rules of Civil Procedure for entry of judgment as set forth in the Court’s Order (R. 30) and requests that the Court approve the form of the judgment submitted herewith or direct such modifications as may be deemed necessary to effectuate its Order (R. 30) for prompt entry by the Clerk.”

It would appear the court has issued a detailed memorandum ruling and judgment.

Your best course of action at this point would be to seek the legal advice and opinion of an attorney licensed in your state. You should specifically talk about grounds for appeal if you feel the ruling was inaccurate after consultation with an attorney.

The court record clearly makes the point you feel victimized by the situation.

“Following the presentation of the Government’s Motion and the arguments and evidence contained therein, the burden shifts to LaBorde to demonstrate to the Court the existence of a genuine dispute of material fact using specific and articulate facts. Though LaBorde, in opposition, states she contests the Government’s “undisputed facts,” she fails to present to the Court any evidence3 or particular facts which fulfill her burden under Rule 56. LaBorde largely uses her opposition to hurl accusations at the Government and paint herself as a victim of its “back-door” efforts to collect her unpaid student loans at the expense of her daughter’s trust.” – Source

If there was a way to wind back the clock, it looks like 2014 would be a good time since the court documents state, “On August 11, 2014, LaBorde received $37,500.00 from the settlement of her father’s estate. See id. at ¶12. While Laborde, through an attorney, offered to satisfy the Judgment with a $35,000 lump sum payment, she never provided the requested financial statement to the Government.”

I’m not casting any blame or opinions about your position. I can only make statements about what the public record says. Going by that it appears you made your best effort to represent your position and lost in court. That sucks.

The court also appeared to give you a little leeway since you were representing yourself but stated “While the Court notes that LaBorde is proceeding pro se, the Court is not obligated to sift through memoranda to find a scintilla of evidentiary support for the nonmovant’s argument. See Garza v. Arlington Indp. School Dist., 18-0829-P, 2020 WL 2812860 at *1 (N.D. Tex. 05/29/20), quoting de la O v. Housing Auth. Of City of El Paso, Texas, 417 F.3d 495, 501 (5th Cir. 2005) (“Judges are not like pigs, hunting for truffles buried in briefs.”). With little more than “conclusory allegations and unsubstantiated assertions,” the Court finds LaBorde has failed to meet her burden to defeat summary judgment.”

My advice would be to find an attorney that is willing to represent you and make a supported legal argument to the federal court that may alter the ruling issued.

Sincerely,

You are not alone. I’m here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don’t give up.

Damon Day - Pro Debt Coach