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Bankruptcy May Be Your Option

Student debt and bankruptcy

Students today are paying more for a college education than any generation before them. In combination with a still-recovering economy in which good jobs are hard to come by, recent graduates in Oklahoma may be feeling the pressure of all those student loans. One option that may be plausible is filing for bankruptcy.

For most debts, both chapter 7 and chapter 13 bankruptcy may be a good idea to help you get back on your feet. In brief, chapter 7 allows you to wipe away your debt by liquidating your assets to give you a fresh financial start, and chapter 13 allows you to restructure your payment. Student loans are different, however. There are specific requirements that must be met to discharge this debt. 

Basically, you must be able to prove that paying your loans back would cause you undue hardship. This does not mean the debt would keep you from living the life you dreamed of. Rather, it would make it impossible to even maintain a minimal standard of living. You must also prove that the situation likely wouldn’t improve as long as you had to pay off the debt. Finally, you must have made a “good faith” attempt to pay the money back before filing for bankruptcy.

Of course, your standard of undue hardship may be different than that of the Oklahoma courts. As such, it is important to contact a bankruptcy law attorney before ever trying to have your student debt discharged. They can review your case and may be able to give legal advice for moving forward in the process. 

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