Should You File Bankruptcy For Your Student Loans

It is estimated that roughly one-sixth of people over the age of 18 in the United States currently have student loan debt. Combined, the national student loan debt tops out at over $1.5 trillion dollars in federal student loans. This number does not reflect student loans from private sources, which are estimated to be an additional $119 billion. To break this down at a more individual level, in 2019 over 69% of college students took out student loans and graduated with an average debt of $29,800. While student loans began as a way for American’s to pursue math and science degrees after the launch of Sputnik in the 1950s, since then student loans have become one of the biggest burdens Americans carry.

After finishing college, more former students are faced with the hardship of having to pay off student loans at rates that are unreasonable for their current living situations. Student loan debt is one of the reasons that over 83% of non-homeowners say that they can’t afford to purchase a home.

The fact of the matter is, that people are struggling with student loan debt and they need help. That’s where we come in. In the past many people have believed that student loan debt could not be discharged through bankruptcy; this is not true. Though it may be more difficult and complex to get student loans removed by filing for bankruptcy it’s not impossible. With the help of an experienced bankruptcy lawyer in Naples, you will be able to either discharge your student loan debt by proving undue hardship or be able to modify, consolidate or settle your debt in a way that makes sense for your current financial situation.

Our Naples bankruptcy lawyers believe that no one should have to compromise their quality of life in order to pay back loans at unreasonably high rates. Even if you don’t qualify for student loan forgiveness via bankruptcy, Miller, Hollander & Jeda offer a Student Loan Modification Program with three different options for every situation.

Read on to find out whether or not you should file for bankruptcy, how you can file for bankruptcy for student loans and what options are available if you don’t qualify for student loan forgiveness.

Should You File For Bankruptcy?

Filing for bankruptcy takes time and money. Before you decide to take “the plunge” and file for bankruptcy, you should first discuss your options with an accredited bankruptcy lawyer in Naples. Bankruptcy may be for you, if you’re currently experiencing either of the following:

  • You Can’t Make Your Payments – Not being able to pay your student loans back and missing your payments, month after month is sure sign that should consider bankruptcy or consolidating your loans; especially if your wages are being garnished or you’re being sued.
  • You Have No Way Out of Default – As this article from Nerdwallet states, Federal student loans have options that allow you to get out of default, such as consolidation and loan rehabilitation. However, if you’ve defaulted multiple times, you may have exhausted these options.

Call Miller, Hollander & Jeda today, if you are facing either of the above financial situations. We can help you begin the process of filing for bankruptcy, by proving you are facing undue hardship on account of your student loans.

How You Can Use Bankruptcy For Student Loans

In order to use bankruptcy as a way to discharge your student loans, you must prove to the courts that your student loans are causing you “undue hardship”. Determining your eligibility is something that should be discussed at length with a Naples bankruptcy lawyer, before you file.

If your lawyer agrees that bankruptcy is the right route for you, you will need to file either a Chapter 7 or Chapter 13 bankruptcy in Naples. In addition to filing for Chapter 7 and Chapter 13 if you wish to discharge your student loans through bankruptcy you must also file an additional lawsuit, called an Adversary Hearing. During this hearing your attorney will take all of the information you have gathered from the months or years of your student loans and create a case in your favor that outlines why you’re unable to pay your student loans. CreditKarma.com explains that being able to show the courts you made a good-faith effort to repay your loans (keep documents and records of these transactions) is extremely helpful to your case. Additionally, you’ll need to bring documents showing your income, debt burden, budget, etc,. From the information gathered during the adversary hearing the judge will make a decision on whether to give you a full, partial, or no-discharge for your student loans.

Other Options If You Don’t Qualify

When you schedule a consultation with a Naples bankruptcy lawyer, he or she will be able to determine your eligibility for qualifying for “undue hardship.” Filing for bankruptcy is an expensive and arduous path to take; it may make more sense for your situation to handle your student loans by enrolling in Miller, Hollander, & Jeda’s Loan Modification program. In this program, we offer three separate options to help people who are struggling to make ends meet due to student loan debt. These three options include, loan settlement, loan rehabilitation, and loan consolidation:

  • Student Loan Settlement – This is an excellent choice for people who are current on their student loan payments, but wish to take care of a large sum all at once.
  • Student Loan Rehabilitation – If your student loans are in default and have been for over nine months, our Naples bankruptcy lawyers will help you to lower your monthly payments and reduce your current interest rate.
  • Student Loan Consolidation – If you have multiple federal student loans that you need to pay back, we can help you to consolidate your loans into one single loan.

If you’re ready to take control of your finances once and for all contact the law office of Miller, Hollander, & Jeda today to schedule a complimentary consultation. Our bankruptcy attorneys can help you discover if you qualify for a full or partial discharge on your student loans by filing for bankruptcy or if there are other options that are more compatible with your specific situation.

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