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Can default Private Student Loans be erased in bankruptcy?

Date: Sat, 10/15/2005 - 16:38
Submitted by on Sat, 10/15/2005 - 16:38
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I had a real financial hardship last year. I lost my job and had some health problem also. Consequently my federal and private student loans went default. I've consolidated federal loans. Now I?m trying to file bankruptcy, since Im not able to pay all my medical bills and credit card dues. Can bankruptcy write off private student loans?


It was easier to erase Private Student Loans through bankruptcy earlier. But the laws have been changed and it's going to be effective on & from October 17, 2005.
http://forums.debtcc.com/forums/bankruptcy-reform.html

New bankruptcy law does not treat private student loans separately. Both Federal and Private loans fall under Educational loan.

So you have to show that repayment of your Private Loans would cause undue financial hardship for you and your dependents. For this you have to pass a benchmark set by bankruptcy court and this is really tough.

Private Student Loans are consolidated. So I would suggest you to consolidate your Private Loans. You can receive a free counseling by filling out the signup form of this site. It will help you to decide what you should do at this stage.


Submitted by 4u.bryan on Sat, 10/15/2005 - 16:52

4u.bryan

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