310.376.9865
One of the methods of discharging a student loan is through a Chapter 7 or Chapter 13 bankruptcy and claim the repayment of the student loan is a hardship.
However, before the bankruptcy court will grant a hardship discharge of a student loan, you must prove the following:
- The debtor cannot maintain, based on current income, a minimal standard of living.
- The circumstance causing the hardship will continue for a significant portion of the repayment period.
- The bankruptcy debtor has made a good faith attempt to repay the loan.
One of the means of proving a good faith attempt to repay the student loan is to show the debtor made an attempt to repay the loan through the Income Contingent Repayment Program and the Income-Based Repayment (IBR).
Since discharging a student loan through a bankruptcy filing is tough, the Income Based Repayment program may in fact be a viable answer, for those faced with a student loan repayment burden.
The Income-Based Repayment plan is for the major types of federal student loans that caps your required monthly payment at an affordable amount based on your income. Current law allows borrowers to limit loan repayment to 15 percent of discretionary income and forgive the debt after 25 years.
To see if you are eligible for IBR, check the Student Loan Government web site.
DISCLAIMER: The content of this website is intended for informational purposes only. Nothing herein is intended to form the basis of an attorney-client relationship or constitute legal advice.
Los Angeles/Orange County Chapter 13 Bankruptcy Attorney
- Law Offices MJ Mann Bankruptcy Attorney
- 2706 Artesia Blvd, Suite BK
- Redondo Beach, CA 90278
- 310.376.9865
