December 15, 2019

Student Loan Debts – Bankruptcy Won’t Help Much

I have been getting a lot of calls and emails lately about student loan debt.  Perhaps with the economy in recession, student loan creditors are becoming more hard line about collecting, and student loan debtors have good reason to be worried.

Federal government involvement in the student loan business means that collection resources not available to regular creditors come into play.   There is one statute that permits student loan creditors to garnish wages without the need to first go to court.   Student loan claims can also offset tax refunds.

Blog reader Janet describes an all too common scenario as follows:

I am unemployed and have defaulted student loans.  I was married last April and my husband’s tax return was offset as a lovely wedding gift.  I am researching how to file for bankruptcy for my other debts and [Read more…]

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