“Dear Steve,
My name is Javier and I have about 105K in school loans. Half of it is interest.
DeVry University told me that I had to take private school loans so I did. The interest is very high.
At that time I went through a divorce at graduating in 2009.
I since got remarried and I have two step daughters which I take care off and two children of my own with my current wife.
My with stays at home and takes care of our children and I work. I make ok money to survive but it really does not leave us for much of anything outside of tight living.
We would like to settle our family and buy a home. This is our dream to have a home of our own.
I contemplated bankruptcy but I hear it is impossible to discharge school loans. Please help me… I do not have any other debt really besides these school loans that part have been charged off. I have like 10K money in a 401K. What can I do to be able to get into a home?
Can I bankrupt private school loans?
How can I get back on track and avoid the heavy interest charges?
How can I buy a home at this point?
HOW can I get to a point to have good credit again?
Thank you in advance for your help.
Best Regards,
Javier”
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The Answer
Dear Javier,
Basically, you’re screwed.
Any concessions on private student loans are available on from the private student loan lender. They typically have few. Even a deferment is a trap. The period when you don’t make payments will cause your loan balance to explode.
It is possible to discharge student loans in bankruptcy but you have to find a bankruptcy attorney that will be willing to go ten extra miles for you in a bankruptcy proceeding.
The research found that consumers that were able to successfully discharge their student loans in bankruptcy under the undue hardship standard had these three characteristics.
- Less likely to be employed.
- More likely to have a medical hardship.
- More likely to have lower annual incomes the year before they filed for bankruptcy.
For more information on this, see How to Really Discharge Your Student Loans in Bankruptcy. Many Can. But Never Try.
Until the legislators take action to make private student loan lenders offer concessions or allow the loans to be dischargeable again, there is no good news I’m afraid.
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Hi Steve , I just want to sawywhat a wonderful thing you are doing to help people that dont understand debt , I worked at many debt setlement companys and credit counseling firms and I found it amazing how litle people knew how to take care of these problems on their own and what is their legal rights . I read what you post every day from other readers and have yet to see any flaw in info that you give to them at no charge !!!! If you would ever like any info on the inside workings of a debt management center please let me know would love to explain to people what really goes on that isnt told to them most of the time , I however made it a point to make sure it was a persons only choice because all else failed and let them know what would be happening in the process and what could happen depending on the state they lived in .Too bad not many people did this and it all turned into nightmares for good people just trying to find a way to pay back debt in a way they could afford. Take care and God bless you.
