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Reorganizing Payments on Student Loans in Chapter 13

Reorganizing Payments on Student Loans in Chapter 13

USING CHAPTER 13 BANKRUPTCY TO REORGANIZE PAYMENTS ON STUDENT LOANS

Under the United States Bankruptcy Code Section 523(a)(8), student loans are generally non-dischargeable in a bankruptcy. Since there is no dischargeability it is important to find a method to deal with the servicing of the debt.
 Chapter 13 bankruptcy can be a good vehicle for managing payments on student loan debt, because the Debtor is only paying the debt according to their available disposable income while they are in the bankruptcy.  I have even had clients who have filed a Chapter 13 because of student loan debt and upon completion of the plan, have refiled Chapter 13 because their disposable income still did not allow to pay the normal scheduled payment.
As always, any opinions expressed on this website are just that, opinions. So if you have a question regarding bankruptcy or debt relief, then please give me a call to discuss your individual situation.  Bankruptcy, as many other areas of the law, can be very case or fact specific.  I pride myself on giving you the answers to your questions that are based on your individual circumstances.

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