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Some are learning a hard lesson about student loan debt

There may have been no prouder moment in your life than when your child walked across the stage to receive his or her college degree. That degree was a tangible symbol of the first serious independent decisions your child made without your help. However, if the truth were told, you played an enormous part in that success. In fact, you may pay heavily for years to come.

More often than in the past, those taking on the burden of student loans are the parents and grandparents of students. Entering your 50s or 60s, you may have had your eye on retirement, but the unforgiving loan payments have put any thought of retirement out of your mind.

Relief from the burden of student loan debt

For many people, an illness or injury increases the desperation of those monthly payments. Late fees and interest build a hefty bill into an unmanageable debt. You may have considered bankruptcy, but you heard that courts wouldn't discharge student loans. This is not always true.

In fact, 40 percent of those who declare bankruptcy receive a student loan discharge. Most of those people were over the age of 60. The process is not easy, but it begins by proving that you have a significant hardship that prevents you from paying off the loan. For a judge to determine if a hardship exists, most states, including Texas, use the Brunner test. This test examines three factors:

  • Whether the loan repayment causes you to subsist below the minimum standard of living
  • Whether you will likely see no relief from this reduced standard of living for the duration of the loan
  • Whether you have shown good faith in trying to repay the loan

Having a permanent disability is one example of a hardship that may result in your student loan debt being discharged. The more evidence you have that the debt creates a hardship, the more likely a judge will allow the bankruptcy to include your student loan.

A complicated process

Whether you have a few thousand dollars at stake or hundreds of thousands, the battle to have that loan discharged is not easy. You may be able to fight it on your own, but such a complex issue has a better chance of reaching a positive outcome with the help of a legal professional.

Filing for bankruptcy may not be the best option for your situation. If not, your lawyer will help you explore other options that will better fit your particular circumstances. An attorney with debt relief experience can guide you through the process so that you can regain control of your life and your finances.

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