We are seeing an increasing number of individuals coming in for bankruptcy consultations because of onerous student loan debt. Many of these people incurred the loans in good faith assuming (often relying on questionable statistics provided by school officials) that when they get their degree they will be able to get a job. Unfortunately in this bad economy many times new college graduates cannot find a job that pays well enough to cover living expenses and pay student loans.
While student loans are almost never discharged (wiped out or eliminated) in bankruptcy, filing a chapter 13 bankruptcy case may provide relief by giving the filer a 3-5 year break from paying on the student loans. While in chapter 13, the student loans are paid through a reorganization plan, and the lender cannot garnish wages or intercept tax refunds during the case. In addition, for those who qualify chapter 7 bankruptcy may eliminate other types of debts, such as credit cards and medical bills, freeing up income to pay student loan payments.
If you would like learn about the bankruptcy process or discuss your particular situation with an experienced Texas Bankruptcy Attorney, please schedule a free initial consultation by calling us toll free at 800.215.9089. If you prefer, you can also fill out our intake form and we contact you to schedule a consultation.