Can I File For Bankruptcy With Student Loans?

Student loans are often the biggest concern people have right before filing bankruptcy. There are several types of student loan debt, including private student loans and federal student loans. Federal student loans are issued by the U.S. Department of Education and backed by the government. Private student loans are not federally backed and are issued by banks or credit unions. Once discharged, however, both federal and private student loan debts cannot be collected by creditors. In addition, once a Chapter 7 bankruptcy petition is filed, all other debts become dischargeable. However, if you file Chapter 13 bankruptcy, some student loan debts may still be collectible.

Chapter 13 bankruptcy is designed to help individuals repay their debts over time rather than immediately paying them off. Chapter 13 plans require borrowers to propose payments directly to lenders and then negotiate the plan with the creditor. In many cases, the court will confirm a Chapter 13 plan even though it does not technically meet the requirements of the bankruptcy code. There are different limits on how much debt a debtor can pay back under Chapter 13, depending on whether the case was filed to stop collection activities (called a “stopping the collection effort”) or to save a borrower’s home (a “saving the homestead”). A Chapter 13 bankruptcy attorney can determine whether a debtor qualifies for Chapter 13 bankruptcy protection based on those circumstances. Most people who file for Chapter 13 bankruptcy do so because they want to avoid foreclosure on their home or repossess items such as cars, boats, or jewelry.

If your primary motivation for filing for Chapter 13 bankruptcy is to get rid of your student loans, you should ask yourself whether or not you qualify for Chapter 13 bankruptcy. If you do qualify, it will allow you to make monthly payments to the lender instead of having to wait until the entire balance is paid off. You will need to provide proof that you graduated from college recently. If you don’t qualify for Chapter 13 bankruptcy, you may be able to refinance your student loans to lower the interest rate, extend the repayment period, or consolidate your debts into a single payment.

You may be able to refile for bankruptcy if:

Your current situation changes dramatically;

You no longer owe money to the original creditor;

You have a steady job with a good income;

You have disposable income;

You own your house free and clear; or

You have a reasonable chance of successfully completing a three-year repayment program.

In addition, you may be eligible to seek relief under the bankruptcy law if you are suffering from mental illness.

Your lawyer will look at your financial condition and evaluate your eligibility. He or she will be able to tell you if you qualify for bankruptcy protection, and what type of chapter you could file.

Can I File For Bankruptcy With Student Loans?

This video goes over some of the options you have if you want to file bankruptcy with student loan debt. It includes how much money you need to start paying back your debts and what happens if you are unable to pay any amount at first.

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Can I File For Bankruptcy With Student Loans?

Student loans can be a very frustrating thing to deal with due to their high interest rate and the fact that they can negatively affect ones credit score. Most people who default on student loan payments do so because they can’t afford them anymore. In today’s economy, with unemployment at record levels, many college graduates are having a difficult time finding jobs. Having a large amount of debt hanging over their heads is not going to help the situation.

The good news is that if you have student loans and need to file bankruptcy, you may qualify for some relief. When filing for bankruptcy protection, you will want to look at Chapter 13 instead of Chapter 7 liquidation. With a Chapter 13 bankruptcy, you will be able to repay much of your debt while continuing to make regular monthly payments. There are strict guidelines for how much money you can get out of Chapter 13 compared to Chapter 7. If you find yourself in this situation, call us immediately! We can help you figure out what type of bankruptcy would work best for you.

If you want to explore other options before deciding on bankruptcy, check out these resources:

StudentLoans Bankruptcy Chapter13 DebtManagement FilingBankruptcy

Can I File For Bankruptcy With Student Loans?

I have been searching for a way out of my student loans. Many people have told me that they were not sure how possible it was to declare bankruptcy with student loan debts. Most banks seem to want proof that you have paid off your loans before they will even consider helping. Unfortunately, I don’t have any proof. My attorney thinks that it may be possible for me to file for bankruptcy with student loans. He says that we need to get some information together first though. What do you think? Is it possible to declare bankruptcy with student loans? How would you go about doing that? Please share your thoughts! Thank you!

Can I File For Bankruptcy With Student Loans?

Student loans have become a major burden for many Americans who are trying to pay back their student loan debt. But if you’re struggling to make payments and are worried about ruining your credit score, then filing bankruptcy might be the best option for you. If you do file for Chapter 13 bankruptcy, you won’t have to worry about losing your home or car. In fact, some lenders may actually help you recover the money you owe.

If you decide to file for Chapter 13 bankruptcy you will need to apply in person at your local courthouse. You should bring copies of your Social Security card, proof of income, tax returns, and bank statements. If you think you qualify for Chapter 13, here are 5 things to know.

Your Income Must Be Less Than $50K

The amount of your income you report in court matters. If you earn over $50k annually, then you will not necessarily qualify for Chapter 13. However, if you earn less than $50k, then you could potentially receive a discharge of your debts.

Chapter 13 bankruptcy requires you to disclose any income you earned last year. So you want to be honest about what you put on your taxes. You are allowed to set aside up to $10K per year for retirement savings, so you don’t have to give away those funds. If you earn less than $150 per month, then you still retain ownership of your car. But if you have other assets, then it might be possible to keep them.

You Can Keep Any House You Own

You can keep any house you own because they aren’t considered property of the bankruptcy estate. If you rent, you will only be able to keep your primary residence that doesn’t exceed half its value. And you cannot use the money you get from the sale of your home to repay your creditors. However, you can keep everything else including cars, boats, jewelry, and even your boat!

Your exemptions can go towards your mortgage payment, your utilities, your groceries, and your medical expenses. You will also be end to a $100-per-month exemption for the first three months after your petition date, and $125 for each additional month.

You Don’t Need To Pay Off All Debt Before Filing

Even though you can keep your 401(k), IRA, and pension contributions, you still need to pay off at least $1400 per month towards your unsecured debt before filing for bankruptcy. You can continue making regular monthly payments towards your secured debts.

You Won’t Lose Credit Score After Filing Bankruptcy

Many people believe that filing for bankruptcy will negatively affect their credit scores. This couldn’t be further from the truth. Because your debts are discharged, you no longer need to make payments on them. Also, bankruptcy will prevent collection agencies from calling you.

While you may lose access to certain types of credit, your creditors will stop harassing you. On top of that, you won’ t have to deal with the inconvenience of paying late fees.

You May Still Get A Job

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