It’s easy to see the attraction of taking out student loans: the money they provide can make all the difference. Unfortunately, the assumption that with a degree, these loans will be easily paid back doesn’t always pan out, and borrowers find themselves mired in unmanageable debt.  If this has happened to you and you’re considering filing for bankruptcy, here’s what you need to know about the legal challenges of trying to discharge student loan debt, and about the other options available to you.

• Bankruptcy offers the advantage of discharge, but only if you are successful In the past, student loans have specifically fallen outside of the types of debt that could be discharged in bankruptcy, but that has changed in the last year. To discharge student loan debt, you need to pursue a different process from the standard bankruptcy process known as an adversary proceeding. This is a request based on undue hardship that repayment places on you and your dependents. Though the bar for qualifying for this has historically been extremely high, a recently established partnership between the Education Department and the Department of Justice made it easier for federal student loan borrowers to request and obtain a student loan discharge in bankruptcy.
• Loan Forgiveness Programs – There are several federal student loan forgiveness programs available to those willing to work in service professions like teaching or nursing for a limited period, and others that allow you to modify your loan to an income-driven repayment plan that forgives the remaining balance.
• Legal Action Against Lenders and Loan Servicers – If you believe that your student loan was made or is being serviced in a way that violates consumer protection laws, you can take legal action that may result in debt relief.
• Try Communicating with Your Lender – Some lenders are willing to modify student loan repayment plans to make your payments more manageable. This may involve extending the term or negotiating a settlement that reduces your balance.

Every situation is different, and it can be hard to know which answer best suits your situation. For assistance, contact our debt and bankruptcy attorneys today.