Are You Unable To Repay Your Student Loans?
For decades, U.S. legislation has been making it increasingly difficult for debtors to discharge student loans in bankruptcy. At one time, student loans were treated like other kinds of debts in the bankruptcy process; they were eligible to be discharged.
Later, Congress imposed waiting periods before which student loans could not be discharged. Congress eventually extended these waiting periods, and then ultimately ended them. Now student debts can only be discharged through bankruptcy if the debtor can prove that the loans present an “undue hardship.” But there is no universally accepted legal consensus about what constitutes “undue hardship.” In the meantime, student debt in the U.S. has been skyrocketing.
If you owe more than you can afford to pay on your student loans, you are certainly not alone. At Kingcade Garcia McMaken, we are here to help. Even if we are not able to eliminate your student loans through bankruptcy, we may be able to help you build a strategy and eliminate other debts so that you have the financial security you need to deal with your nondischargeable loans. For more information, contact our office online or call us at 305-285-9100 for a free consultation.
Does Your Loan Constitute An “Undue Hardship?”
For the most part, student loans are not dischargeable under Florida and federal bankruptcy laws, which means that at the end of the process you will likely still be responsible for paying these loans. In certain cases, however, it may be possible to get an exception that permits those in the most serious need to eliminate these debts.
When deciding if your student loans might be dischargeable, courts need to determine whether your loans present an “undue hardship.” To do this, courts often look at three factors, which together are known as the “Brunner test”:
- Whether you are able to maintain a minimum standard of living while paying your loans
- Whether you’ve made an effort to repay your loans
- Whether your current financial situation is likely to persist into the future
These issues require consideration as a separate element of a normal bankruptcy proceeding called the “adversary proceeding.”
How We Can Help
Our primary attorney, Timothy S. Kingcade, is both an accomplished bankruptcy lawyer and a certified public accountant (CPA) with a sophisticated understanding of law and finances. We can provide valuable insight into your financial challenges, and help you build strategies for credit relief, debt recovery or elimination that take on your situation from all sides.
- If you are eligible to discharge the debt through a Chapter 7 or Chapter 13 bankruptcy filing, we can help you make that happen.
- If your student loans, like most, are nondischargeable, then we may be able to address other debts, such as credit card bills or medical expenses, so that you have the resources you need.
The most important step is the first one: Getting the right information. Without a clear picture of what options are open to you, it is nearly impossible to make a timely and accurate decision. We are committed to doing what is best for any potential client, and during your free initial consultation we can give you the information you need to find the right solutions.
If now isn’t the time to file for bankruptcy, we will never push you toward something that won’t make a substantial and positive difference in your life. However, if bankruptcy laws can help you build a solid financial future, you should know what can be done to help you.
It Costs Nothing To Consult With An Attorney
To find out how our bankruptcy firm can help you get results, whether we get your student loans discharged or find another solution, contact our Miami law office online or by phone at 305-285-9100 for a free consultation.