The federal student loan debt is insanely high and getting some sort of relief from the loans is very difficult. A lawyer specializing in student loan debt is essential for any success in relation to such loan dismissal.
This lawyer can file for an 'adversary proceeding' which is a request for acknowledgement that your current and future financial situation deems you unable to pay back your debt. Chapter 7 and Chapter 13 bankruptcies do not count student loan debt in their findings though Chapter 13 bankruptcy is usually the best route for relief from your student loans- for a time.
During the relief offered by a Chapter 13 bankruptcy, you can start making positive steps towards proving your inability to pay by following the details outlined in the Brunner Test.
The Brunner Test
The Brunner test involves emphasizes three factors:
- Poverty - If your current income barely covers your necessary expenses then paying your student loans and maintaining a minimal standard of living will be impossible.
- Persistence - Is your current financial situation guaranteed to last indefinitely, or at least for the entirety of the student loan repayment period? If so, then you meet the persistence factor of the test.
- Good Faith - Have you tried to pay your payments in the past? Have you kept in contact with your loan providers and communicated your money problems with them to work out lower payment plans? If you have done either of these and have not been placed in default then you will qualify for the good faith factor.
The most difficult factor to check off your list is usually the 'good faith' factor. To increase your chances of gaining relief from your student loan debts, answer those bill collectors and hear what they have to say. Be honest about your monetary situation and income.
Even if you can't pay much, $5 a month shows that you at least understand that you have a responsibility to repay the loans and that will bring you out of default and put you in good faith. Maintaining a constructive dialogue is key and choosing the right lawyer who is experienced in student loan debt and bankruptcy is essential.
The Law Offices of James C. Shields assists people with all bankruptcy matters. Our professional team is knowledgeable about the law and compassionate towards people who have found themselves unable to pay their debts. We offer payment plans for our reasonable fees and we guarantee that our work will benefit you and your family.
Contact us at the Law Offices of James C. Shields at 310-540-6792 or fill out our online form. We're here for you.