Can bankruptcy affect getting approved for a student loan?
Yes it can. A personal bankruptcy indicates that a person is a poor money manager, and any lender will be unlikely to want to lend to a bankrupt individual.
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I worked for Direct Loans so I know a little about these things. You do have a few options. If your income is very low you could change pay plans to the "Income Contingency Pl…an. This plan is where you make payment according to your income. The payment can be as low as nothing a month. Usually they have payments of $12 a month. After 26 years the federal Government will forgive the loan and you will not have to pay it. Other options are deferments. You can stop payments for several reasons. Call Direct Loans for more information. A deferment stops payment and the Gov. will pick up the interest on the subsidized portion of your loan. You can get a forbearance, which will stop payment on your loan, but you will still accumulate interest on all parts of the loan. I live in WA State. I did a bankruptcy 7 years ago, but was unable to include my student loans. I was told by my attorney that I could have included them if I had paid on them consistently for 5 years prior to the bankruptcy. I had only paid on them for 2 years straight at any one time... between extensions & forbearance's. Like many others, I shall be paying on these damn loans with my Social Security Checks... never mind choosing between eating & medication. ;) The only way to discharge a student loan through bankruptcy would be to demonstrate a hardship. I don't mean 'hardship' as in, gee its hard for me to pay. I mean a hardship like I'm completely disabled and cannot work. Second way out is to emigrate. Student loans are one of those loans that don't go away. If you file bankruptcy,student loans are very much not exempt. You still have to pay up. The Bankruptcy Code used to say that student loans could be discharged if they were more than 7 years old AND some other criteria were met. In the past few years, the Code was changed and now the Bankruptcy Code says (in 11 USC 523): "(a) A discharge ... does not discharge an individual debtor from any debt- (8) for an educational benefit overpayment or loan made, insured or guaranteed by a governmental unit, or made under any program funded in whole or in part by a governmental unit or nonprofit institution, or for an obligation to repay funds received as an educational benefit, scholarship or stipend, unless excepting such debt from discharge under this paragraph will impose an undue hardship on the debtor and the debtor's dependents;" This means that you can only discharge student loans in bankruptcy if you can show that repayment causes an undue hardship on you or your dependents, and like someone said in a posting above, this does NOT simply mean "Gee these things are hard to pay." I read a case once where the debtor became paralyzed from the waist down, and the Bankruptcy Court did not allow him to discharge all of his student loans since he could still work a desk job. I think the posting above by the person who used to work for Direct Loans has some really good ideas to deal with student loans, but please keep in mind that nothing I say in this posting or in any other posting constitues legal advice, it is simply my understanding of the facts. Please read! If you and your wife owe 80grand you probably don't owe all of that to federal (staford) loans. federal loans do not go away but if you went to a private school that is much more expensive than federal you probably got extra "gap" loans from bank. those loans get to go! I am about to drop about 50g of 120g. that's mostly credit cards and student gap loans. I have declared Chap. 7 Bankruptcy in 2000. It was discharged, and my student loans were included. However, everyone says I still owe the money. So the question is, does the Judge's word not count? If he accepted the bankruptcy lock, stock, and barrell, it doesn't matter, the student loans still count? I've been paying them since the mid 80's.... many forebearances. If the judges word does count, how do I go about enforcing it? Listing Student loans on the bankruptcy petition does not mean that they are discharged. In order to receive a discharge you must ask the court specifically to discharge the student loans. This is done through an adversary proceeding with notice to the student loan holder. It is much like holding a civil trial during the bankruptcy proceeding. The discharge you received said that "all dischargeable debts" were discharged. This does not include student loans, backed by a government agency, because they are not dischargeable by statute, section 523(c)8 of the Code, unless certain criteria are met. These criteria need to be determine by the court through a "trial." Due to bankruptcy reforms in 1998 and 2005, it's almost impossible for the average person to discharge federal or private student loans through bankruptcy. Although your student loan can't be discharged in bankruptcy, a bankruptcy court may be able to ease an overwhelming debt burden. Some courts may discharge a portion of your student loans, but this is rare and varies by court. In most cases, the judge will incorporate your student loans into your debt repayment plan under Chapter 13 bankruptcy. Any balance remaining after the payment plan ends will still be due, but your other debts should be paid off by then A bankruptcy will not remove student loans but will include the student loans in the bankruptcy. The debt will be gone, but any credit report listing will continue to be listed as included in bankruptcy.
Can you file chapter 7 and not include your student loans in the bankruptcy since they are in deferment and also continue getting student loans while in college?
\n. \n Answer \n. \n. \nI believe that student loans are a category of debt that is not dischargable in bankruptcy. The bankruptcy will show up on any credit reports, …and you may subsequently be unable to et additional loans.\n. \nI filed for bankrupcy in 1998. I was able to obtain Student Loans despite the bankruptcy in 1999-2000. My past credit history was not considered when determining my student loan application.
I am trying to figure this out myself as I have recently filed bankruptcy and both my husband and I are students. There is a portion of the bankruptcy code that makes it illeg…al for government agencies to refuse student loans to those who have filed bankruptcy. So, as far as getting Title IV funding, such as government backed loans, you should still be able to get them. Title IV loans are not granted based on credit worthiness and therefore should be given to those who have filed banlruptcy, as long as there are no other eligibility issues, such as a student loan in default, drug conviction, etc. If you want to get a loan from a private lender, then they are under NO obligation to give you a student loan if you have filed bankruptcy or have other credit problems. For example, the Plus! loans that are available to parents are based on creditworthiness, so a bankruptcy would affect your ability to get this type of loan. As far as my student loan after bankruptcy, I did have to fill out additional paperwork and am still awating the results. I will post again after I find out what happens.
Answer . No, you can't get out of paying a student loan by filing bankruptcy.
You pay it.
Government insured student loans are exempt from the Bk process. They must be paid.. However, they will not collect money from you until the bankruptcy is dismissed or discha…rged, but it will still accrue interest during that time.
Sadly, yes. What a way to start your life though. Adding that to your resume is not a great idea. Student loans are not usually discharged in bankruptcy. While in bankruptcy…, collection efforts will cease until the bankruptcy becomes inactive.
Although bankruptcy is a genuine path to get out of debt, it leaves a long lasting scar, and comes at a high price financially and emotionally. The financial impact is severe;… a bankruptcy will stay on your credit report for 7-10 years. You shouldn't consider bankruptcy as a simple "quick fix" to all of your financial difficulties, but rather as one of the many available solutions you may have given your individual situation.
You must list student loans in your bankruptcy. They are not dischargeable, though collections actions are stayed by the automatic stay when the case is filed.
It does not affect them.
\nIn the US, yes
In Personal Finance
I did a bankruptcy a few years back, and Student Loans are not included in the bankruptcy, which means you will still be liable to pay them back. Also a car loan or any secure…d debt will not be wiped out. Keep in mind with the student loans, generally if you are having trouble paying them, you can get an income based deferment or lowered payments.
According to my Spanish teacher, student loans are the only things that cannot be "wiped out" by declaring bankruptcy. She told us that the government will continue to reach i…nto your bank accounts until that money is payed off.
No you can not but if you own the school it's self money that was due to classes or books you could file on that portion alone I have done that
Most federal student loans are not based on credit but rather financial need determined by your FAFSA. The FAFSA looks directly at your income and your parents income if you a…re a dependent, in comparison to the estimated cost of attendance at your educational institution. For the most accurate information check out the related link.
In Bankruptcy Law
Student loan bankruptcy happens when a student has not been a student for the last 7 years and declares bankruptcy. For more information please contact a student loan office.