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jefflaura... jefflaura...
 
M$1 March 03, 2009 09:23 PM

Is it possible to file bankruptcy on defaulted student loans?

What are the laws?
Interesting Question?  Yes (0)   No (0)   
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robotech_m... robotech_m...
 
 March 03, 2009 09:40 PM
Not unless you can prove that repaying the loan creates an "undue hardship" for yourself and/or your family.

Even then, a court has held that "bankrupts can't erase student loans just by showing they can't make the payments, but must also prove their financial outlook is so hopeless that repayment is impossible in the future."

See "sources" section for some links.
Source(s):
http://www.moranlaw.net/answerstudentloans.htm
http://www.studentloanborrowerassistance.org/bankruptcy/
http://bankruptcy.lawyers.com/Student-Loans-In-Bankruptcy.html
http://articles.moneycentral.msn.com/SavingandDebt/ManageDebt/3waysToAvoidT...



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danheil danheil
 
March 03, 2009 09:27 PM
no you cannot

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thelastsci... thelastsci...
 
March 03, 2009 10:13 PM
"It is difficult to prove "undue hardship" unless you are physically unable to work and there is no chance of your making money. To discharge your student loans under this special case, you must file a separate motion with the bankruptcy court and present your situation before a judge.

If your student loans are the largest part of your debt, you are better off not filing for bankruptcy because courts are very reluctant to discharge student loans."
Source(s):
http://www.salliemae.com/after_graduation/manage_your_loans/borrower_respon...


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