Student Loans Are Not Dischargeable in Bankruptcy Yet

Written by Adam Peck Category: Nursing Homes January 23rd, 2013 1 min read

Recent laws have made it more difficult and expensive for people to file for Chapter 7 bankruptcy, which erases most debts. Even if a person was able to file for Chapter 7 bankruptcy, odds are, the bankruptcy will not forgive any student loans.

Data from Kiplinger’s Personal Finance magazine, published July 2007, estimated that the average debt a student incurs from attending college for four years is $20,000. That likely explains why student loan default rates are rising, according to data from the S&P and Experian Consumer Credit Default Index.

Despite the U.S. economy recovering from a recession, those who are seeking forbearance on their loans only find themselves incurring additional fees as they continue to find a way out of the debt.

Unfortunately, those who are looking for an out have very few options. There is no statute of limitations on the outstanding student loan debt, which means that the lender can attempt to retrieve the money, even the person files for bankruptcy. Those with student loans are urged to continue making timely payments.

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Written by Adam Peck

Expertise: Personal Injury

Adam J. Peck, ESQ is a principal with Peck Law Group, APC. In 2008, Mr. Adam Peck received his Juris Doctorate from Whittier Law School where he graduated Cum Laude. His practice is primarily dedicated to representing Elders, Dependent Adults, along with their loved ones and family members, who have suffered horrific personal injuries.