Student loan debt is one of the largest growing debts in America. Most students come out of college and/or graduate school with insurmountable amounts of debt. Unfortunately it is necessary for most students to rely on student loans to pay tuition and cover other expenses related to their education, but upon graduation it is difficult to find a job that pays enough to repay educational loans. When consumers are overwhelmed by debt they often times turn to bankruptcy as a way to alleviate financial pressure. But not all debts are eliminated by filing bankruptcy, so before you file you need to know what you will and will not gain by filing a case.
If you are looking to get rid of your student loan debt by filing bankruptcy, you need to know the obstacles in place that may prevent that from happening:
● In order to discharge student loan debt you have to prove that you have made a good faith effort to pay back the loans prior to filing bankruptcy.
● You must also establish that if you are required to repay your loans, you and your dependents will suffer an undue financial hardship. This can be hard to prove, because the standard is pretty high. Most families have access to more than one income, and since your dependents rely on you as well as their other parent, whatever income your spouse makes will be taken into consideration when determining whether repayment of student loans is a hardship for your family. Most people are unable to prove this requirement.
These reasons are what make it hard to discharge student loan debt in bankruptcy, and most debtors do not even try. But each case is different, and it is worth taking a look at your specific situation before dismissing the idea off the bat. If you have large student loans and a small income, let us take a look at your case and give you a realistic outlook on what you can expect if you file bankruptcy. If you are not able to include your student loans in your bankruptcy, you may want to reconsider your options, especially if student loans are your only debt. We can help you find other ways to get out of debt if bankruptcy is not right for you, and we can also help you get out of debt by filing bankruptcy if that meets your needs.
For help with your questions about finances and how to get out of debt, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that help get you back on your feet.