Can I Discharge My Student Loans in Bankruptcy?
For many people, student loans make up a large part of their debt problem. Discharging student loans in bankruptcy is at best extremely challenging, and at worst, not possible.
However, this does not mean you should give up. It is quite possible that bankruptcy can benefit you if you have student loan debt. An experienced attorney from Rothschild & Ausbrooks, PLLC, will be able to discuss your options with you. Contact our firm today to arrange your free consultation and get the answers you need.
Why Is It Difficult to Discharge Student Loans in Bankruptcy?
The Bankruptcy Code was updated to prevent the discharge of student loans in 1976. In the years since, further legislation has preserved this prohibition due to fears people would use bankruptcy to discharge student loan debts unfairly, without a true need to do so.
However, we know that most people honestly want to pay back their financial obligations, but simply do not have the means to do it. Many have fallen on hard times because of the tight job market, a medical emergency or a permanent disability that prevents them from getting a job that allows them to repay their student loans. Whatever your situation, our lawyers want to help you overcome the burden of debt.
How Can I Obtain a Student Loan Discharge?
Discharging student loans in bankruptcy is difficult, but may be accomplished by an experienced lawyer. If we can show that paying the student loan debt would cause an undue hardship on you, we may be able to get the debt discharged.
What is an undue hardship? Essentially, it means paying the debt would force you into a minimal standard of living. With more than three decades of experience serving people in Nashville and throughout Tennessee, we know how to eliminate student loans when it is possible.
There Are Other Ways Bankruptcy Can Help You With Student Loans
Just because a student loan cannot be discharged does not mean bankruptcy cannot benefit you. In many cases, student loans are just one of the debts people are struggling to pay. By eliminating the other debts through bankruptcy, you may find that paying back your student loans is much easier.
For example, perhaps you have considerable unsecured debts such as credit card debt or medical bills. These debts are dischargeable in bankruptcy, which means you do not have to pay them back. Filing Chapter 7 bankruptcy would eliminate these debts, leaving you more money each month to repay your student loans.
Or, perhaps you have secured debts such as a mortgage and car payment. If you need to keep your house and your car, discharging those debts is not the right option. In a case such as this, you may be able to file Chapter 13 bankruptcy. Under Chapter 13, your debts, including the mortgage and car payments, are reorganized into a repayment plan that you can afford. During the repayment plan, which is typically three to five years, you will have more money available to pay your student loan payments. For some people, Chapter 13 gives them the time they need to pay down a portion of their student loan while making their other important payments as well.
Talk to Us to Learn More
We know this can be a confusing issue. Our knowledgeable bankruptcy lawyers will discuss the specifics of your finances and help you understand all of your options for obtaining debt relief.
Contact Us for a Free Bankruptcy Consultation
Please contact Rothschild & Ausbrooks, PLLC, today to get answers about discharging student loans in bankruptcy. We seek to help you become debt-free so you can move forward with your life.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.