Over 20,000 public servants recently became (theoretically) eligible for the loan forgiveness programs they’d been counting on. Less than 300 were allowed to take advantage of the program.
Draconian requirements and a series of headache-inducing hoops disqualified many from the program. Some were led to believe they were making the right payments in the right program for loan forgiveness, only to find their loan servicers led them astray.
See also: In the News: Navient Student Loan Lawsuit.
Right now Americans carry $1.5 trillion in student loan debt. At this time, borrowers can’t discharge this debt in bankruptcy unless they can prove a significant financial hardship.
This truth has led 71 colleges to start actively discouraging students from taking out student loans, and to develop programs so lower-income students, and, in some cases, even middle-income students, do not have to.
It’s also led many to speculate that returning student loans to the 1970s rules allowing them to be discharged in bankruptcy will be a major issue on the campaign trail in 2020. And the suggestion has widespread public support. The Washington Post calls bankruptcy the “silver bullet” for the student loan crisis.
While other reforms are being suggested, the bankruptcy reform is the one to watch. It’s probably the proposal that requires the least amount of change, and which is more likely to get support from both sides of the aisle.
In the meantime, eliminating other debts so you can focus on paying off your student loan debts may be the only way to get out from beneath this crushing burden. Bankruptcy can help you clear your other monthly obligations, freeing up cash you wouldn’t have seen otherwise.
Of course, to reap the benefits you’d have to use the freed funds to lower your student loan debt load.
And if you’re not making enough money to even pay your basic expenses, regardless of your debt load?
You may be one of the few individuals we can help out by making a case for an undue hardship exception.
You won’t know unless you try.
Is your debt load too heavy to handle? Contact the Law Offices of Sadek & Cooper today. One way or another, we can help you get some sort of relief which should vastly improve your situation.