Can You Get Out From Under Your Student Loans?

For many people in North Carolina, student loans are one of their greatest financial burdens. These loans can take decades to pay off, and often contribute to the need for a debt relief solution. At Butler & Butler, LLP, we have helped hundreds of clients in the Wilmington area struggling to pay their student loans and other debts make a fresh start through bankruptcy.

The Myth Of Student Loans And Bankruptcy

There are a lot of misconceptions about how bankruptcy deals with student loans. The most persistent myth is that student loans are always non-dischargeable debt — in other words, that you cannot use bankruptcy to reduce or eliminate student loans you cannot afford.

This is not true in all cases. Though it can be challenging, it is possible to discharge student loan debt in many cases. Under the law, the bankruptcy court can discharge your student loans if not doing so would cause you undue hardship. The definition of undue hardship varies, but in general, courts look for three things:

  • Continuing to pay off the loan would make it impossible for you to maintain a minimum standard of living
  • Your financial situation is unlikely to change in the foreseeable future
  • You have made a good-faith effort to pay the loans

Because this is a relatively high standard, to give yourself the best chance of discharging or reorganizing your student loans in Chapter 7 bankruptcy or Chapter 13 bankruptcy, you will need experienced representation from one of our lawyers. We will make a persuasive case for the court based on the evidence and our deep understanding of bankruptcy law. We will also counsel you on alternatives, such as loan consolidation, deferral or forbearance to help you get reduced payments.

Get Your Student Loan Debt Under Control With Our Help

For an in-person, no-obligation consultation with one of our attorneys, please call our office at 910-726-3155 or send us an email.