Does Chapter 13 Bankruptcy Discharge Student Loan Debt?

  • David M. Offen,
  •   Chapter 13 Bankruptcy
  •   Comments Off on Does Chapter 13 Bankruptcy Discharge Student Loan Debt?
student loan debt

student loan debt

Many people are bogged down by student loan debt. They want nothing more than to get this debt off their plate, realizing that doing so would put them in a much better financial position.

Here is the problem: the best way to eliminate student loan debt is to pay it off in full. This can take a lot of time. It can also take its toll on your finances. Even so, it is typically the only option.

What about Chapter 13?

Most of the time, a bankruptcy court requires the repayment of student loan debt. In other words, just because you file for Chapter 13 does not mean your student loans will be discharged.

Bankruptcy courts treat student loan debt in the same manner as other priority debt, such as back child support payments and back taxes. They expect it to be paid in full, not discharged through the bankruptcy process.

Is there hope? While not easy, there is always the chance that you could convince the court to discharge your student loan debt through a Chapter 7 or Chapter 13 filing. The court takes into consideration things such as the inability to pay the loan due to a disability, poverty, or a good faith effort to repay the entire amount over a long period of time.

If you want to test the water, you are required to file a separate action known as a Complaint to Determine Dischargeability of a Debt. Without this, you have no chance of your debt being discharged.

If student loan debt continues to drag you down, you may begin to consider the bankruptcy process. Just remember one thing: it is not simple to have this debt discharged by a bankruptcy court.

Do you have questions about this? If so, reach out to us for assistance. We can help you create a plan for bettering your financial future.


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