Is bankruptcy an option if I am being sued for student loans? 12 Answers as of April 26, 2011

Plaintiff, United States Of America, having filed its complaint herein, and dendant, me, having consented to the making and entry of final judgment by consent, without trial, hereby agree... Is there any place that will pay off this student loan and I repay them or what should I do? I am self employed and I dont have a stable income. Even if they set me up on a payment plan im not sure if i will be able to pay it.

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William C. Gosnell, Attorney at Law
William C. Gosnell, Attorney at Law | William C. Gosnell
No, you can't bankrupt student loans.
Answer Applies to: Tennessee
Replied: 4/26/2011
Burnham & Associates
Burnham & Associates | Stephanie K. Burnham
Student Loans are not ordinarily dischargeable in Bankruptcy. In order for Student Loans to be discharged, you must be able to reach the very difficult level of a "Hardship Discharge" - and that is certainly more than just being unemployed, or temporarily unable to work. Even those scenarios do not get relief under this Discharge.
Answer Applies to: New Hampshire
Replied: 4/26/2011
Bankruptcy Law Office of Robert Weed
Bankruptcy Law Office of Robert Weed | Robert Weed
You can file a Chapter 13 and pay all the court thinks you can afford on the student loans. At the end of the Chapter 13, they will still be there, so this is only a temporary solution and not a very good one at that. Trying to work something out with them is better if you can.
Answer Applies to: Virginia
Replied: 4/25/2011
Ferguson & Ferguson
Ferguson & Ferguson | Randy W. Ferguson
You can put in a chapter 13. If not paid off at the end of plan, you still pay remainder after plan finishes. If chapter 7, you still have to pay outside of bankruptcy.
Answer Applies to: Alabama
Replied: 4/25/2011
Mercado & Hartung, PLLC
Mercado & Hartung, PLLC | Christopher J. Mercado
Unfortunately, student loans are generally not dischargeable.
Answer Applies to: Washington
Replied: 4/22/2011
    Bankruptcy Law office of Bill Rubendall
    Bankruptcy Law office of Bill Rubendall | William M. Rubendall
    Bankruptcy will not wipe out your student loans except in a rare instance called hardship. A hardship discharge requires extra legal work in a bankruptcy in a lawsuit. Chances of winning are slim. One thing to consider is structuring a Chapter 13 plan that would allow you to control the payment for up to 5 years. At the end of 5 years you would still owe the unpaid balance, but by then you may be able to continue regular payments as you have done successfully in the Chapter 13.
    Answer Applies to: California
    Replied: 4/22/2011
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    Sounds like you have already agreed to have a judgment entered against you. You cannot generally discharge student loans in bankruptcy unless you can show that because of disability you cannot earn a living and that you have done everything possible to pay. There are programs offered by the student loan lenders to allow you payment plans and you need to try all of those before you have a chance of having student loans discharged in bankruptcy. You should have a consultation with a bankruptcy lawyer about your specific situation but it is very difficult to have student loans discharged in bankruptcy and also expensive because you have to file a lawsuit in the bankruptcy case to have the court decide if you can discharge the student loans in bankruptcy. You can expect a battle in court over the dichargeability of such loans so it gets expensive and the chances of winning may not be great.
    Answer Applies to: California
    Replied: 4/22/2011
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    Student loans are a huge problem for many people. Getting them discharged is very difficult. Talk to an experience lawyer in your area, one who know the local judges. That lawyer might have a feel for the possibility of getting them reduced. these are debts that will haunt you into your old age. Eventually they can garnish your social security benefits, so trying to get it resolved now (if you can) is the best plan of attack.
    Answer Applies to: California
    Replied: 4/22/2011
    Law Office of L. Paul Zahn
    Law Office of L. Paul Zahn | Paul Zahn
    Student loans are generally not discharable in bankruptcy.
    Answer Applies to: California
    Replied: 4/22/2011
    Indianapolis Bankruptcy Law Office of Eric C. Lewis
    Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
    Student loan obligations are not dischargable through bankruptcy unless the debtor can show extreme undue hardship which is a very high standard to meet.
    Answer Applies to: Indiana
    Replied: 4/22/2011
    Law Office of Eric Ridley
    Law Office of Eric Ridley | Eric Ridley
    Student loans are never, ever dischargeable in bankruptcy, except under extremely rare conditions.
    Answer Applies to: California
    Replied: 4/22/2011
    The Law Office of Mark J. Markus
    The Law Office of Mark J. Markus | Mark Markus
    Student loans are only dischargeable in bankruptcy if you can prove "undue hardship" as that term is defined by the courts in your jurisdiction. To obtain a discharge based on undue hardship in the Ninth Circuit (which includes California) you must prove all of the following:
    1. **that you cannot maintain, based on current income and expenses, a 'minimal' standard of living for yourself and your dependents if forced to repay the loans; /This is usually the easiest prong to satisfy.
    2. that additional circumstances exist indicating that this state of financial affairs is likely to persist for a significant portion of the repayment period of the student loans; and,
    3. that you made good faith effort to repay the loans. /This does not just include making payments on the loans. It requires doing things over time such as making efforts to increase your income (which includes going back to school to get additional degrees or experience), consolidating loans with the Direct Loan Servicing Center , and other similar efforts./ Student loan discharge cases require a separate trial and are not inexpensive. To make matters worse, they are rarely granted.
    Answer Applies to: California
    Replied: 4/22/2011
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