When someone encounters financial hardship, they often consider filing bankruptcy to help offset their debt and start fresh.
There are many new laws that have been set in place, and not all debts are automatically cleared or discharged simply by filing bankruptcy.
Student loans might not be discharged through bankruptcy.
Back in the ’70’s, people enjoyed a wonderful education at the finest schools in America. Once they had graduated they would declare bankruptcy and find all of their student loans were discharged. This is no longer the case.
There is a procedure that allows some people to discharge their student loans through bankruptcy. However the person must show that they will suffer undue financial hardship if required to make repayment.
If you are experiencing financial hardship and have an outstanding student loan, it is in your best interest to have a free evaluation with a bankruptcy lawyer to assess your case and review your financial documents.
Your attorney can give you their professional opinion whether or not they believe you can qualify for your student loans to be discharged.
Typically, you will need to prove that you will be forced to live at the minimum poverty level if you repay your student loans. Additionally, it will be determined whether or not you have ever made payments on your loan.
If you don’t qualify to have your student loans discharged, you will be able to work out a payment arrangement that fits your needs. It is important to let your attorney know what your needs are and what you are capable of repaying.