You attended a college or university in pursuit of a starting your career but being stuck with student loan debt can be financially and emotionally overwhelming. Your monthly payments may be barely affordable, and you may feel like there is no other way out.
If this is you, understand that you’re not alone. Forbes reports that student loan debt is currently the second highest form of consumer debt – surpassing credit cards and auto loans. The collective amount of student loan debt owed in the United States is more than $1.5 trillion among 44 million debtors.
On average, students who graduated in 2016 have $37,172 in student loan debt. The delinquency or default rate among borrowers is 10.7 percent.
Exploring your financial options
If you are unable to make your student loan payments and have explored every avenue to attempt to do so, you may have options that could ease the financial pressure.
Under the Brunner standard, you may be able to discharge your student loan debt if you meet the following criteria:
- You have extenuating circumstances that make it difficult or impossible for you to make your student loan payments.
- Those circumstances are indefinite or will continue throughout the term of your student loan.
- You have made good faith attempts to repay your student loan. This doesn’t necessarily mean you have made payments, but rather attempted to work out an affordable payment plan.
In order to discharge your student loan debt through bankruptcy, you must file an adversary proceeding within bankruptcy court. During this process, you must provide proof that paying your student loan would create a serious hardship.
Generally, it is impossible to discharge your student loans through bankruptcy. Judges are, however, exploring ways to make accommodations in some circumstances. These include:
- Eliminating future tax bills associated with student loan debt relief or debt cancellation.
- Cancelling private student loan debt if school is unaccredited.
- Allowing debtors to make full payments through a Chapter 13 bankruptcy
Why you need an attorney
Filing for bankruptcy isn’t something anyone can do. It’s a complex process that requires the work of an experienced South Carolina bankruptcy lawyer. At Matthews & Megna, LLC, our legal team will assess your financial circumstances and work within the court to find a solution that fits your needs. We handle all types of bankruptcy cases, including those involving student loan debt.
Contact us today to find out how we can help you.