If you are one of the millions of people in the country that owe money on government student loans, you would probably like to see that balance be discharged as part of your bankruptcy. At Rothschild & Ausbrooks, PLLC, we understand that the bankruptcy process can be frustrating. Understanding how student loans factor into your debt can help make the Tennessee bankruptcy process less stressful.
Perhaps you have found yourself in a situation where you are now unable to work due to a disability of some other type of condition. However, prior to this time, you made your student loan payments on time. According to Forbes, you may be able to show a bankruptcy court that you qualify for what is known as undue hardship.
Like most people, you probably took out the loans because you thought that getting a degree would give you access to better jobs and higher incomes. However, the reality is that for some people that just doesn’t happen. If you have missed a payment or become delinquent on your loan you are not alone. In fact, one in four student loan borrowers are in the exact same boat.
One solution may be to switch to a payment plan that bases your monthly payment on how much money you make. While it may take longer for you to pay your loan off this way, at least you know that you will be able to afford your payments. Another option is to refinance your government loan with a private lender to get a lower interest rate. The government hopes that by offering borrowers solutions such as these it can prevent a flood of bankruptcy filings that will clog the system. For more information on how student loans factor into bankruptcy, please visit our web page.