01/06/2016
Some thoughts about student loans and bankruptcy. We see many people with just absolutely oppressive student loan debt that they will never be able to repay. I've seen single parents with $100,000 to $200,000 dollars of student loans earning $40,000 per year. These days the student loan creditors have some amazing collection powers, including even income tax refund intercepts and wage garnishments. Sometimes you can qualify for the income contingent repayment plan (ICR), or the income based repayment plan (IBR), to get a manageable monthly payment. Unfortunately if your loans are mostly from private lenders you won't qualify for these programs. An amazing solution that most people never think of is a chapter 13 bankruptcy filing. It allows you to consolidate your debts and use the bulk of your income stream to live on and then pay only the amount you can afford on your student loans each month. The payment under these kinds of circumstances is likely to be far less than the required monthly minimum payments that the lenders will accept. We've been able to achieve some amazing results for people who thought they had no hope. Years ago student loans were dischargeable in bankruptcy. The law has evolved to make them very hard to discharge (not impossible, but very hard). The tide is slowly turning as a massive student loan bubble has formed (estimated at over 1 trillion dollars) and there is a growing realization among lawmakers that something will have to be done--eventually. In the meantime these obligations can be deferred, basically indefinitely, 5 years at a time, by filing chapter 13. If you find yourself struggling under a heavy student loan obligation call today for a free consultation to see how a chapter 13 reorganization could improve your life.http://www.thecollegefix.com/post/23766/
Crushing student loan debt has caused many to put off major life milestones, survey finds.
