We may never hear the end of one of the most popular bankruptcy related debates: Can you discharge your student loans in bankruptcy? Is it possible? When pressed most student loan litigation attorneys will eventually provide you with a short answer, and it’s simple. The answer is usually no because student loans are not dischargeable. But the long answer is quite a bit longer.

An Overview of Student Loans and Bankruptcy:

You aren’t the only student loan borrower struggling to repay student loan debt. You also aren’t the only student loan borrower who is considering bankruptcy as an option. Student loan borrowers in the United States owe $1.5 trillion. Student loan balances are the second highest consumer debt category. The only categories outpacing student loan debt are mortgages and credit card debt.

Mortgage balances and credit card debts are both frequently discharged in bankruptcy. Yet student loans are traditionally excluded. They are excluded from discharge. Some expect the bankruptcy laws excluding student loans to change as more and more consumers find themselves buried under ballooning student loan balances that they’ll pay on their entire life with no hope of zeroing out their balance. The original rationale for excluding student loans stemmed from the concern that students could borrow at will, earn a degree, and then file for bankruptcy as soon as they accessed all the student loans they needed and got the degree they intended. The rationale is not outlandish. Without the exclusion, many borrowers probably would have taken advantage of bankruptcy laws and the protections offered to consumers with overwhelming debt.

However, Aronow Law, PC has successfully removed student loans through bankruptcy when there are exigent circumstances, such as fraud. Additionally, in Chapter 13, often the lender cannot prove that they have the proper documentation to support a proof of claim and may settle at reduced payoffs. In some cases, the conditions are right to assert enough pressure through litigation to get you a better deal.

If you are struggling to make your student loan payments and need help, please get in touch with the experienced student loan litigation attorneys at Aronow Law PC to discuss your options. We can help you weigh the pros and cons of student loan consolidation, protecting yourself through student loan litigation or filing for bankruptcy.