Consolidating student loans bankruptcy

That is four times the number who borrowed in 2007.

Even worse, the Government Accounting Office says that 37% of student loan borrowers age-65 and over are in default.

When discussing the allowance of student loan bankruptcy options in the future, it’s important to understand how we got to where we are today.

Let’s (very) briefly go over how the current bankruptcy situation came about.

Congress made federal student loans ineligible for discharge to ensure the solvency of the federal loan program.

However, if borrowers can prove that they meet certain criteria, exceptions have been made. (In addition, a recent court case shows that discharge may also be possible if the borrower can prove their student loan did not constitute an “educational benefit.”) The standards for these points are very strict and often very difficult to prove (some even argue “impossible”).

be discharged through traditional bankruptcy proceedings. Regardless of your income status or how far you might be behind on your loan payments, the fact is that discharging your student loans through bankruptcy, at this time, is not an option.