I cannot pay my student loans. Can bankruptcy help?
Millions of Americans pay significant amounts of money to invest in their education in the form of student loans. After graduation, many of these individuals find that they are not able to make payments and keep up with the exorbitant amount of debt that they accumulated over their years in college. For many graduates, post-college life is dominated by debt.
If you find yourself in a similar position and you are currently unable to make payments on your student loans, you could be searching for a way out. Student loan debt is a major problem, but there may be a way to deal with this debt and salvage your financial future.
The discharge in bankruptcy
Bankruptcy is often a reasonable and positive choice for individuals who are overwhelmed by debt. While under either Chapter 7 or Chapter 13 bankruptcy, applicants can enjoy freedom from harassment from creditors while discharging debt. The discharge releases the debtor from any liability on that balance, but it is only possible with certain types of debt.
Most of the time, student loan debt is not dischargeable debt. This means that while bankruptcy cannot get rid of those pesky and expensive loan payments, it can help you confront other types of debt, including:
- Medical bills
- Credit card debt
- Car loans
- Mortgage debt
- Personal lines of credit
The particular chapter of bankruptcy that is best for you will depend on the unique circumstances of your case and the types of debt you owe.
Leverage the benefits of bankruptcy
Student loan debt may not be eligible for discharge in bankruptcy, but that does not mean that you would not benefit from this protection. By filing for bankruptcy and completing the process, you may enjoy the following benefits:
- More disposable income to put toward student loans
- Stable financial future to help you deal with non-dischargeable debt
- Less stress from harassment and collection efforts related to other debts
Student loans are a serious financial burden, but there may be ways for you to regain control over your financial circumstances and effectively deal with this type of debt. Just because bankruptcy cannot specifically address this type of debt does not mean that there are not legal options by which you can achieve financial relief. A strong financial future is possible, and, with the right help, you can move past your current difficult circumstances.