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Can you do anything about student loans you cannot pay?

Many types of debt can be discharged through a Chapter 7 bankruptcy, including credit cards, medical debt and fees resulting from late utility payments. However, as many people in Eugene have become aware, federal student loans are one type of debt that is not dischargeable. If you have student debt, you will be required to repay it. Filing for bankruptcy will not affect your student loans. Is there anything that you can do to relieve this burden if you find yourself unable to make your student loan payments?

The United States Department of Education’s Federal Student Aid site lists several ways you might be able to address this problem. One of the most common and effective methods to deal with insurmountable student loan debt is to have your payments deferred. If approved for a deferment, you would be relieved of making payments for a certain period, during which you might be able to increase your income. You may also use this time to deal with your dischargeable debt by paying it down or filing for bankruptcy, which could make paying your student loans easier. Speaking with your student loan officer might also enable you to restructure your payment schedule based on your current ability to pay.

In cases of extreme hardship, such as permanent disability, you might be able to have your student loans forgiven or canceled through a bankruptcy. However, this result is quite rare and usually involves time-consuming and exhaustive legal procedures to prove your case to a court. The information in this post should not replace the advice of a lawyer.

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