What do you do when the bills are piling up and you are no longer able to pay them all? There are several answers to this question, depending on your circumstances. For example, if you have student loans, you may be eligible for student loan forgiveness through certain options for federal student loans. Alternatively, you might want to apply for Chapter 13 bankruptcy. But is it possible to take advantage of both options at the same time in Florida? If you are curious about Chapter 13 bankruptcy and whether you still qualify for student loan forgiveness programs, an overview of how these programs work may be the best place to start.
Student Loan Forgiveness Programs: An Overview
Student loans are designed to help young people and those seeking to broaden their opportunities to pay for formal education. The idea is that the education the student receives will allow the student to repay their student loans once they get a job. Unfortunately, this isn’t always the case. Some graduates have difficulty finding a job in their field, while others may get an education that falls short of what they were promised. In these situations, the debtor may seek loan forgiveness.
Loan forgiveness programs fall into several major categories:
- Income-driven repayment plans
- Forgiveness for people in public service
- Anti-scam forgiveness
- Partial forgiveness for teachers
- Discharges due to disability
There are other ways to obtain forgiveness or take part in payment plans as well.
Chapter 13 Bankruptcy: How It Works
When most people discuss bankruptcy, they are probably thinking about Chapter 7 bankruptcy. This is a form of bankruptcy most people file where most debt is discharged and most people keep all their assets. However, Chapter 13 bankruptcy works differently. With this type of bankruptcy, you agree to a payment plan of three to five years. At the end of that time, if you have maintained payments throughout the process, most debts are fully discharged.
Chapter 13 bankruptcy allows you to repay your debts at a rate that your income can sustain.
Impact of Chapter 13 on Student Loan Forgiveness Eligibility
For many types of student loan forgiveness, Chapter 13 bankruptcy won’t affect eligibility. If your school misled you about the quality of its program, for instance, the fact that you needed to file for bankruptcy shouldn’t harm your chances of getting forgiveness based on that fraud. If anything, your declaration of bankruptcy may be evidence that helps support that you were defrauded by the school.
Have your student loans and other bills left you financially unstable? Chapter 13 bankruptcy or student loan forgiveness may be solutions for your difficulties. Contact my law firm at (407) 749-0080 to schedule a free consultation as soon as possible.
Benefits of Pursuing Forgiveness During Chapter 13 Bankruptcy
At the end of Chapter 13 bankruptcy, most of your debts should be discharged. However, not all debts are dischargeable. Student loan debts are treated differently in Chapter 13 bankruptcy. The automatic stay that comes with declaring bankruptcy will generally apply to them, which means that your creditors must immediately cease any attempts to get money from you. Similarly, during the repayment portion of the bankruptcy, you will need to pay only the value assigned by the bankruptcy court. When those three to five years end, the student loans will typically not be discharged automatically.
To add student loans to a bankruptcy declaration, you will need to go through adversary proceedings, where you convince the court that repaying your student loans would be an undue hardship. Based on recent rules, this process should be easier than it used to be. An increasing number of people who petition the court for student loan discharge during Chapter 13 bankruptcy successfully receive it, or at least a portion.
But what if you are in a situation where getting these loans discharged isn’t possible? You may still be eligible for forgiveness, and Chapter 13 bankruptcy can make pursuing loan forgiveness more straightforward. Since the loan companies can’t pursue payments during bankruptcy, you have less stress on you. You can take your time to fully understand your options and pursue the forgiveness option that is best for your circumstances.
Steps to Take to Maximize Your Chances of Forgiveness
Getting loan forgiveness can be challenging in Florida. One of the most crucial steps you can take to maximize your chances of receiving forgiveness is to discuss your financial situation and your legal options with me. I can guide you through the process and help you understand how current cases moving through the courts may help or hinder your chances of getting relief.
You will also want to be sure to preserve as many financial records as possible. Typically, the more evidence you can provide to the government when applying for forgiveness, the more likely your case will go smoothly. While collecting ample records doesn’t guarantee you will be approved, it can improve your chance of success.
Contact a Florida Chapter 13 Bankruptcy Lawyer Today
Have you reached a financial point where you’re considering declaring Chapter 13 bankruptcy? Before you make a decision, it’s vital that you consult an experienced bankruptcy lawyer in Florida. My law firm helps people in situations like yours every day, and I can provide personalized guidance for your unique circumstances to help you protect your future.
Chapter 13 bankruptcy and potential student loan forgiveness may be viable solutions to your financial problems. Contact my law firm today at (407) 749-0080 to learn more about how I can help you get back on your feet financially.
Attorney Lewis Roberts
The weight of debts that one cannot pay carries financial stress into every waking moment. It is time for this to end. Lewis Roberts, PA, offers solutions to relieve these worries. With over 20 years of experience in helping individuals overcome the burden of debt, bankruptcy attorney Lewis Roberts presents a range of options tailored to each unique situation. Clients can trust his advice on any matter related to debts, as he identifies appropriate options and explains the paths to debt relief clearly and carefully. This ensures that clients make the best decisions for their future. [ Attorney Bio ]
