Can bankruptcy help with student loan debt? This is a question we are asked by many clients. The truth is it is very difficult to discharge student loans and most individuals without a full and permanent disability will likely not qualify. However, it is always important to have a knowledgeable debt relief attorney review your case. Therefore, the intention of this blog post is to discuss the reason for filing a Chapter 13 bankruptcy, even if your loans are non-dischargeable.
A benefit of filing for Chapter 13 bankruptcy, even though your student loans are non-dischargeable, is the deferment that you will be granted. Often times, clients are looking for a reprieve from the repayment of their loans, whether the loans are federal or private student loans. A Chapter 13 bankruptcy can last up to 60 months. While the chapter 13 bankruptcy is pending, you may be able to pay nothing toward your student loans or a significantly reduced amount. This may be a good option if you have a significant life event or believe your income in the future will be sufficient to begin repaying your loans.
It is important to remember interest will continue to accrue on your student loans during the pendency of the bankruptcy, so it is important to keep that in mind when making your decision. Recently, many federal loan programs have been established to offer income contingent repayment options. These options may offer greater relief for individuals who have federal student loans. Unfortunately, these federal loan programs are not always available for private student loans. Our office and our experienced attorneys can help you determine what your best options are to manage your student loan repayment. Call to schedule an appointment in our Greensburg, Latrobe, or Johnstown offices. We help clients with debt relief questions all across Southwestern Pennsylvania.