Student loans and bankruptcy: What you need to know
For many Minnesota families, student loan debt is one of the biggest financial burdens they face, along with mortgages and healthcare costs.
For many Minnesota families, student loan debt is one of the biggest financial burdens they face, along with mortgages and healthcare costs. If you are struggling to stay current with your payments to creditors, you may want to consider filing for bankruptcy after consulting an experienced Twin Cities bankruptcy lawyer.
But you should be aware that in many situations, student loans cannot be discharged like other debts on your credit card or medical bills. So even if you file for bankruptcy, you will likely still have to pay off these loans after your case is resolved.
However, the news isn’t all bad. By working with your lender and keeping your attorney in the loop, you can often renegotiate the terms of your student loans to make it easier for you to afford them and stay current on your payments. For some, this is the best way to resolve issues you’re experiencing with student loan debt.
Bankruptcy can also help make it easier to repay these loans by clearing your other unsecured debts, depending on the chapter of bankruptcy for which you file. An experienced lawyer like those at Atlas Law Firm can help you maximize your ability to repay the debts that can’t be discharged.
There is one major exception to the rule about student loans in bankruptcy. If you are experiencing “undue hardship” due to debts incurred through education, making it impossible for you to reasonably repay them, your representative can argue that they should be cleared. Sometimes this could involve a career-ending injury or another serious external force.
To find out more about how bankruptcy can help you become financially stable, contact Atlas Law Firm today.