Can Declaring Bankruptcy on Student Loans Get Rid of Your Debt? Find Out What the Possibilities Are

Bankruptcy is seen by many as the last resort, but perfectly feasible, as a mean to clear their financial woes. While it could indeed be a viable option for you and the only option available to you, you should discuss the matter with an attorney in order to double check that it is the way to go and to find out whether it would be possible for you. There are debt, for example, that might not be eligible for bankruptcy. Declaring bankruptcy on a student loan is usually not permitted, for example.

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Some debts simply will not be discharged or eliminated by bankruptcy. These include child support or taxes, criminal fees or fines etc. Declaring bankruptcy on student loans is one of those cases that are often a no go.

There is actually some logic behind this decision. Congress want lenders to be keen to lend money to students in the form of student loans. This sees to it that more young people have access to a college education. In making it possible to wipe out a student loan with bankruptcy, fewer lenders will be keen on doling out such loans in the first place. As such, declaring bankruptcy on student loans is not usually possible.

It is not always impossible though. In order to eliminate student loan debt you have to be able to prove that in order to pay the loan you would have to undertake a sub standard lifestyle and that even under those circumstances it might still be impossible for you to pay back that debt. So, essentially, your situation has to be dire. Of course, how dire it must be will depend entirely on the judge who is in charge of your case.

So while it is not impossible, it is certainly difficult.

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