Will a Bankruptcy Filing Stop My SSI Wage Garnishment for Student Loans?

Question:

Dear Steve,

SSI BENEFITS ARE BEING GARNISHED FOR 30 YEAR STUDENT LOANS BY COLLECTION AGENCY THAT I CAN’T GET TO ANSWER THE PHONE OR RETURN A CALL –15%. THINKING ABOUT FILING CHAPTER 7 BK FOR HARDSHIP AS I’M RETIRED AND THIS IS HARDSHIP ON ME?

WILL A BK STOP THIS OUTRIGHT?

Omar

Answer:

Dear Omar,

So it sounds like this issue has been brewing for some time. A wage garnishment does not happen overnight. You can stop the wage garnishment by following these directions.

Alternatively, you can go for a student loan rehabilitation which can stop the garnishment and bring the loan current so you can get on an income-driven repayment plan with minimal payments.

While you might be able to eventually have your loans eliminated in a Chapter 7 bankruptcy you would have to file an additional Adversary Proceeding, which can be very expensive. Even then, there is no guarantee the loans will be discharged.

Steve Rhode Debt Coach and Author

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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