It’s a topic that has been showing up over the last couple of years and appears to be gaining steam. Student Loan debt loads may be hurting the economy. As a generation graduates with higher student loan debts than any before it, economic data is starting to show these young people are having increasingly difficult times paying back their student loans or contributing to the economy through car or home purchases. Forbes- February 2012: Student Debt the Next Financial Crisis? Washington Post February 2014: Student Debt May Hurt Housing Recovery New York Times – May 2014: How Student Debt May Be Stunting the Economy Just last week, President Obama issued an executive order designed to provide help to approximately 5 million student loan borrowers. We have been seeing it for a while. As bankruptcy attorneys in Kansas City, we get phone calls from potential clients seeking information about their bankruptcy…
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A question that often comes up when we speak with clients is how to tackle student loans when it comes to bankruptcy. Oftentimes, a young family is swimming in debt, a significant amount of which is in the form of student loans. A recent article in on CNN Money brought to light just how dire the student loan situation has become. According to the article, the average student loan debt of a person who graduated in May 2013 was $35,200. For many, this debt is manageable until they get married and now have two combined student loan payments, plus a mortgage, plus medical bills, etc. Student loans have their own set of requirements when it comes to bankruptcy. Loan companies are not going to easily forgive the debt of student loans. Below, you will find a few things to consider when trying to recover from the mounting debt of college…
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KANSAS CITY, Mo., Aug. 20, 2013 /PRNewswire/ — The United States Bankruptcy Court for the Western District of Missouri entered an Order on May 29, 2013 approving a settlement for a Missouri woman owing more than $400,000.00 in student loans. Per the settlement the woman is entitled to receive a bankruptcy discharge of up to $325,000.00 of student loans. The holders of the student loan debt were Suntrust Bank and Educational Management Corp. Our client agreed to a repayment schedule of approximately 25% of the balance over a ten (10) year period of time. Upon successful completion of the partial repayment, the entire balance will be discharged. Neil Sader and Megan Dennis of The Sader Law Firm represented this client. Sader stated, “While student loans generally are not dischargeable in bankruptcy, there is a hardship provision which can be used in certain deserving circumstances.” The client in this case was…
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