College offers young people a chance to achieve great things, both personally and professionally. However, student debt is a major concern, especially since this is typically not eligible to be discharged under current bankruptcy laws. Gilbert P. Kaback, Attorney at Law, is well aware of the damage unchecked debt can do. At his Colchester, CT, practice, he strives to provide clients with the information they need to make good decisions, including how student loan debt is handled during bankruptcy.  

Changes in Bankruptcy Law That Affect Student Loan Debt

While in the past, student loan debt could effectively be discharged when filing for bankruptcy, changes to the law now make this an unlikely occurrence. However, there are some cases where a graduate could potentially have their debt discharged, especially when faced with serious financial instability.

For instance, graduates of for-profit academic institutions that are now closed might be eligible to have their debt discharged, particularly when the institution employed a private company to issue loans. Another situation where discharge could be possible is when the graduate is in such dire financial straits that repayment of the loan could harm the individual.  

How Student Loans Can Be Discharged

An adversarial hearing is the process for discharging student debt according to bankruptcy law. To do so, you must present evidence to the court that establishes your financial hardship and how keeping current on your loans could imperil your well-being. In this case, you have the best chance of receiving a discharge if you can show you made attempts to pay off loans before your financial situation became untenable. You must also show how the hardship you’re currently experiencing will most likely last indefinitely.

Student loans continue to increase as the price of attending college rises, but declaring bankruptcy can sometimes relieve you from the financial strains of this hardship. From debt relief options to solid criminal defenses, Gilbert P. Kaback, Attorney at Law, provides indispensable legal services to the people of Colchester. For more information on bankruptcy law, visit the firm online, or give them a call at (860) 537-0874 today to schedule a consultation.