Loans.org Says Student Loans should not be Dischargeable through Bankruptcy

Student loan debt has reached such epic proportions that legislators and students have requested that the bankruptcy laws should be changed, allowing these debts to discharged in court. But a new piece appearing on Loans.org argues that this isn’t a viable solution to the student debt crisis.

Generally, students cannot have their student loans discharged unless their bankruptcy lawyer can prove that paying off those debts causes extreme hardship.

When a bankruptcy discharges a debt it simply stops collection activity. If the individual seeking debt protection has a co-signer, as many students do, the debt burden is shifted to their parents.

Loans.org opposes allowing these debts from discharge because of the burden it would place on parents in a time when retirement funds are being drained.

If the student doesn’t have a co-signer Loans.org argues that the debt would place a financial liability on colleges and loan providers. Student loans would be harder to obtain and affect the amount of revenue that university and colleges get from these loans.

They make valid points, but the student debt crisis begs for a solution. Although student loans cannot be discharged, other debts can be reduced or dismissed through bankruptcy, allowing the indebted the chance to pay down student debt.

A bankruptcy attorney can offer the person with too much debt a number of solutions to their financial woes. Credit card debt, mortgages and other loans can be discharged.

Any person who needs debt-relief should contact a bankruptcy lawyer to determine if a Chapter 7 or Chapter 13 bankruptcy plan will work for them.