More and more students are becoming strapped with student loans once they graduate. The lending institution will give them a certain amount of time before they start making payments. If a graduate does not get a job making a substantial amount of money then there is a good chance they will not be able to afford the payments. Some students graduate with as much as $40,000 in student loans. This figure can be as much as $100,000 in some instances. People are forced to work two or three jobs in an attempt to pay same day cash loans and because of that, these debts and sometimes the job is not even what they went to school for.
It does not appear that the economy will be improving any time in the future. Unemployment is expected to increase from its current level of 6.5% to 8% next year. More companies are laying off as opposed to hiring due to the economic down turn. We are definitely in a recession. With these factors in mind a lot of people with student loans are wondering if bankruptcy is going to be their only option for receiving relief from their debts.
Unfortunately student loans cannot be discharged when a petition for bankruptcy has been filed on behalf of a debtor. There are certain circumstances which do allow for student loans to be discharged and that would be if a debtor has become permanently disabled or if the debtor becomes deceased.
Other instances that allow student loans to become discharged is when an institution of higher learning is closed before the student graduates. In the past financial institutions were taking heavy losses from individuals that filed bankruptcy therefore the bankruptcy laws were rewritten in 1998, to make it much harder for people to file for bankruptcy and in the process students loans cannot be discharged and have to be paid back.
Sometimes student loans need to be deferred or in other words the repayment needs to be put off until some time in the future. There are several ways of doing this. One way of doing requires the student to attend school at least part time and take approximately six credits per semester. Extreme hardships can also serve to help you get a student loan deferred. If you are temporarily disabled you can get your student loans deferred. Simply contact the financial institution and let them know what the situation is and they will most likely have you fill out some paperwork to get the process going.
If you do default on a loan that institution has several remedies to collect which include the garnishment of your wages and taking possession of your income tax refund check. Huge fees can also be accessed not to mention the interest that accrues which makes it more difficult to pay the loans back. Sometimes you can consolidate the loans which normally decrease your monthly obligation. There are certain companies that specialize in student loan consolidation.