We have written extensively in previous posts about the difficulties many students in New Jersey and elsewhere are having with the enormous amount of debt they have when they complete their college education. Students leaving college with five- and six-digit student loan debts are in need of debt relief, but many of them are unable to achieve it through Chapter 13 or Chapter 7 bankruptcy because of the rules pertaining to how student loans are treated in bankruptcy proceedings.
Now, a group of students and former students from around the country have banded together to take their plea for a fresh financial start directly to the government officials who oversee the student loan programs and the schools that most of the students in the group attended. The members of the group have refused to make payments on their loans in protest of what they perceive as the government’s failure to protect them from unscrupulous practices by some schools that left them deeply in debt with useless college degrees.
While government officials have expressed sympathy for the financial challenges faced by members of the group, they have not taken as action to discharge the loan debt, reduce interest payments or take other action that would offer debt relief to those burdened by student loan debt. For some individuals confronting similar financial challenges, a consultation with a bankruptcy attorney might be of some assistance.
Although discharging student loan debt might not be possible for most people filing a Chapter 13, a payment plan that offers them manageable payments might help them afford the payments on the student loans. Discussing with an attorney the benefits that a Chapter 13 bankruptcy might offer toward achieving a fresh financial start might offer hope to someone who has otherwise given up hope of being able to reduce debt.
Source: My 9 NJ, “Loan recipients on ‘strike’ meet with federal officials,” Kimberly Hefling, March 31, 2015