According to a new report issued by the Consumer Financial Protection Bureau, students in the United States have accumulated $150 billion in private student loan debt. Unfortunately, this is only a small chunk of the total financial debt for education, which in 2011, was estimated at over $1 trillion, including public and private school debt. American students are now taking on more debt than ever before to fund higher education, which isn’t entirely surprising given the financial crisis our country has found itself in. However, as a result, many consumers in Oklahoma and throughout the United States are facing unpayable debt, and are considering bankruptcy as an option. If you think filing for bankruptcy in Oklahoma might be the right choice for you, contact our experienced bankruptcy attorneys at Oklahoma Legal Center today.
Student Loans Are Not Dischargeable
The bad news for students struggling with massive student loan debt is that this type of debt is not dischargeable in bankruptcy. According to changes established by the 2005 amendments to the bankruptcy code, even if consumers file for Chapter 7 bankruptcy to eliminate their debt, student loans will remain. According to the Consumer Financial Protection Bureau report, defaults on private student loans – which describes a situation in which a student has failed to make payments for at least 270 days – totaled more than $8.1 billion. Defaulting on a student loan is damaging, and the negative mark can remain on an individual’s credit score for seven years.
How Your Credit Score Can Affect Your Life
While students and younger consumers may not pay their credit score much attention, having a good credit score is important, as it can assist them in qualifying for loans, housing or certain jobs. Unfortunately, when they are unable to make payments on their debt, they may end up defaulting on their loans, which can in turn negatively affect their credit score. Although it is very difficult to discharge student debt, it can be done if the consumer can prove to a judge that repayment could constitute undue hardship. Because “undue hardship” is an extremely difficult situation to demonstrate, enlisting the help of a knowledgeable bankruptcy lawyer in Oklahoma is critical to improving your chances of relieving your student loan debt.
Contact a Bankruptcy Attorney for Legal Help
Bankruptcy has always carried a negative stigma, since it is commonly associated with debt, default and ultimately, failure. In many cases though, bankruptcy may be the best course of action for consumers who want to relieve their debt and start over with a blank slate. For these people, bankruptcy may actually be the first move in a positive direction. If you are considering filing for bankruptcy in Oklahoma, our skilled bankruptcy lawyers at Oklahoma Legal Center are standing by, ready to help. With our team of knowledgeable bankruptcy attorneys on your side, you can examine the current state of your finances and determine whether bankruptcy is the key to eliminating your overwhelming debt.