People misunderstand nowadays because it is impossible to file for bankruptcy for student loans, but the truth is private, and student loans can be discharged while you are in bankruptcy. However, wiping out all of these debts is not so possible.
This is why we always advise that due to the financial impacts and potential costs of bankruptcy, you should carefully examine your debt relief options before going ahead to make a decision. So, welcome to our can you file bankruptcy on private student loans review.
Can You File Bankruptcy On Private Student Loans
At the end of any bankruptcy process, you can be able to discharge all of your student loans, but certain things need to be done first;
Work With A Bankruptcy Attorney
Even though this might not be so necessary, working with a bankruptcy attorney, especially one with years of experience on student loans, can you help find your way through the entire process? If you file for bankruptcy, it could range from maybe several hundred to several thousand dollars.
But this depends on how complex your case is and your location. Furthermore, there are also attorney fees required for adversary proceedings if you want to get your student loans discharged.
Filing For Chapter 13 or Chapter 7 Bankruptcy
Before your student loans can be discharged, you would have to file for bankruptcy, and with the help of your attorney, he would be able to determine the best consumer bankruptcy for you, whether it is chapter 13 or chapter 7.
However, if you filed for bankruptcy earlier but didn’t consider discharging your student loans, you can reopen the case again and make sure they get cleared.
To Start Adversary Proceeding, File A Complaint
If you want to discharge your student loans through bankruptcy, then one legal lawsuit that you would also need is called ADVERSARY PROCEEDING. To begin this, your attorney is likely to file a written complaint that would best explain your case, and from this point, your case gets litigated until the judge determines an outcome.
As a result, it is possible for you not to get your student loans discharged, get them partially discharged, or get them totally discharged.
Even though discharging your student loans is possible, they are worth exploring under the following circumstances;
1. If All Of Your Payment Options Has Been Exhausted
You should check if you qualify for loan forgiveness or can afford an income-driven payment if only you have student loans. Unfortunately, there are fewer options for private student loans for borrowers who are still struggling. Still, it is also okay for you to contact your lender and confirm if you can lower interest and payment rates.
2. You’re Behind On Your Student Loans
If you rarely miss out on making payments as when they are due, then proving undue hardship will be very difficult for you. Instances of student loans are when bankruptcy makes more sense, especially if you have initially been behind on student loans and your lender decides to sue you to spice up your wages.
3. Difficult To Get Out Of Default
There are options to get out of default under federal student loans, including consolidation and loan rehabilitation. However, if you have already defaulted on paying up your student loan several times, then you might have well used up all of your options as well.
The truth is all of these situations still don’t tell for sure that all of your student loans would be discharged, but at the same time, some borrowers have been lucky. So before filing for student loan bankruptcy, please ensure that you talk with a professional.
The best person who would help you figure out the best options you have is either a bankruptcy attorney or a student loans lawyer.