While Student loans do not get forgiven when filing for bankruptcy, there are more rules while filing for Chapter 13. Student loans can be quite a financial stress, and it appears to be more stressful than previously thought.
When you go through Chapter 13 Bankruptcy, you are prohibited from making full payments on your student loans during the case’s three-to-five-year repayment schedule. The Wall Street Journal reports that because of the rule in the U.S. Bankruptcy Code, lenders can add late fees and other penalties to your balance.
The fees are legal, as a way to stop the individual from filing from paying down their student loans while ignoring bills for other debts. While Chapter 13 Bankruptcy might be the only option, give us a call and we can discuss how to best tackle your debt problem.