Navigating bankruptcy is a complex legal process that deserves a significant amount of time and consideration before reaching a resolution. Although it can yield significant benefits for some, bankruptcy involves a unique set of consequences and should be discussed with a bankruptcy attorney in Florida before making a decision. Depending on the type of bankruptcy, consequences can include lost assets and impacted credit. However, it’s important to remember that bankruptcy only disrupts your life—it doesn’t destroy it.
There are many financial changes that take place during and after filing bankruptcy. Although many people will continue to make their student loan payments, a select few might have the option to discharge them. In fact, only about 0.1 percent of Americans who file for bankruptcy try to discharge their student loans. This is why hiring an attorney for this process is so important.
In this article, we will discuss the best ways to handle student loan debt when filing bankruptcy.
How to Discharge Student Loans in Bankruptcy
In some cases, student loan debt can be discharged by the Court. However, in order for the Court to consider discharge, you must prove that continuing to make student loan payments will worsen your financial situation. Although the process of filing for bankruptcy alone is enough to prove that you are experiencing financial strain, you must also provide evidence that proves “undue hardship”. This “undue hardship” exception includes different tests and analyses as determined by the Court to assess your true financial situation.
Although it is difficult to be granted student loan discharge, it isn’t impossible. Research shows that approximately 40 percent of people who apply for discharge during bankruptcy is successful.
What Outcomes Can I Expect?
After making your case and proving your level of hardship to the Court, there are three potential outcomes for your student loan discharge.
Why a Bankruptcy Attorney in Florida is Your Best Option
Not many people have navigated the process of discharging student loans, especially since many think it’s impossible. A bankruptcy attorney in Florida knows how to navigate these types of cases and is your best shot at granting you a student loan discharge. It’s crucial to have insight into how local jurisdictions work in your area, and the best way to file your paperwork to get things started.