Student loan debt in America has reached an all-time high of $1.4 trillion, according to Experian. With the average student loan balance of over $35,000, stagnant wages, and limited opportunities for new graduates, millions of people are struggling to make their payments.
But what options are really available if you’re having trouble repaying your student loans?
Although student loans are usually not discharged in bankruptcy, depending on the circumstances and the type of loan, discharge and forgiveness are options for some. There are also consolidation and other ways to reduce your obligation.
If you’re looking to get out from under crushing student loan debt, it may be time to consult a
student loan lawyer. At Luftman, Heck & Associates, we can review your student loan debt, explain all of your options, and specifically what you can do to reduce or eliminate your student loans.
Student Loan Discharge & Student Loan Forgiveness
Put simply, Student loan forgiveness, cancellation, or discharge all mean that you are no longer required to repay some or all of your loan balance. While often used interchangeably, there are important distinctions between the terms and when they are applicable.
- Student loan forgiveness means you’re no longer required to make payments on your loan, usually based on working in a particular occupation for a period of time. Examples of student loan forgiveness programs include loan forgiveness for teachers, nurses, doctors, and those working in public service.
- Student loan discharge refers to the cancelation of your loan based on your circumstances. Common examples of when student loan discharge is possible are if you become totally and permanently disabled if your school closed, or in the case of a successful student loan bankruptcy filing
Student Loan Discharge Discharge
Under some unique circumstances, certain federal loans are dischargeable, canceling any further repayment obligation. You may qualify for student loan discharge if:
- You suffer a total and permanent disability. Total and permanent disability, or TPD, discharges are available for Direct, Perkins, and Federal Family Education loans in the event that a borrower becomes permanently and completely disabled so that he or she cannot participate in the workforce.
- You die. Federal student loans will be discharged in the event that the borrower dies before the obligation is satisfied. Parents who took out Parent PLUS loans for a child may also have their loan discharged upon the death of the child.
- You file for bankruptcy Keep in mind that student loan debts aren’t dischargeable in the same way as medical or credit card debt, but bankruptcy courts can discharge student loans if certain conditions exist. Essentially, you must show that the monthly payments make it impossible to have a minimal standard of living, you won’t earn enough money to make your monthly payment in the foreseeable future because of your specific circumstances, and you’ve made a good faith attempt to pay or negotiate lower payments before filing bankruptcy.
- Misrepresentation. The school you took out the loan to attend misrepresented the benefit you would receive from attending, signed your name to a loan application without your authorization, certified that you would be eligible for employment in the field in which you were trained even though they were on notice of something that disqualified you, or failed to disburse a refund that was owed to you.
- You were the victim of identity theft.
Student Loan Forgiveness
Loan forgiveness programs have recently been significantly expanded. Once your loan is forgiven, you no longer have to pay the remaining balance. You may be eligible for loan forgiveness if:
- Teacher student loan forgiveness. If your balance is from after October 1998 and you’ve been teaching for five consecutive years in a low-income elementary school, secondary school, or educational service agency you could have as much as $17,500 of your outstanding balance forgiven.
- You are employed in an eligible public service position. If you have a qualifying public service position and have made payments on your federal loans for 10 years, you may be able to have the rest of your balance forgiven.
When a Student Loan Lawyer Can Help
Being buried by student loan debt is more than a burden. It’s keeping an entire generation from moving forward in life, and it’s reached a critical level. If you’re tired of struggling to make even the minimum interest payments on your student loans, it may be time to consult an attorney.
At LHA, we have extensive experience helping people properly manage their student debts. There are various refinance, consolidation, and forgiveness options that may provide relief. We can explain which programs would benefit you the most, guide you through the process rather than handling things on your own, and negotiate on your behalf if a lawsuit or bankruptcy is necessary.
Keep in mind that while a bankruptcy filing isn’t right for everyone, even if you have to keep most of your student loans after the bankruptcy, a successful filing and discharge of your other debts can give you room to breathe and the financial resources to actually make your student loan payments.
What a Student Loan Lawyer Does
- Get legal advice & guidance regarding your rights and options.
- Effective representation in any negotiations with a student loan servicer, collection agency, or bankruptcy court.
- Address credit disputes & resolve delinquencies.
- Protect you from unfair or abusive conduct by debt collectors.
- Facilitate student loan forgiveness eligibility and application process.
Overwhelmed by Student Debt? Contact the Cleveland Student Loan Attorneys from LHA.
In the Cleveland, Ohio area, call Luftman, Heck & Associates at (216) 586-6600 or contact us online. Let’s talk, go over your finances, and explain how to put student loan debt behind you.