Are there any options for paying student loans after a chapter 13?
I will be done with paying my 4 year chapter 13 bankruptcy in August, and I am worried about my student loans that I will have to start to pay back. I have already been on a tight budget, and the student loans will be like an expensive car payment that i can not afford.
Is re consolidation the only thing I can do?
Posted May 1st, 2010 in Bankruptcy Q And A. Tagged: car payment, chapter 13 bankruptcy, consolidation, expensive car, student loans, tight budget.
Bill:
Contact the servicing agent for the lender – there are a number of alternative payment programs that are available to you. You didn’t mention whether your lender has declared your loans to be in default – that status would eliminate some of the options.
Another very important determinant will be the type of loans that you have – the government-backed loans (Stafford, Perkins, PLUS) have far more options than private loans.
Many borrowers consider lenders about the lowest form of animal life on the planet, but the reality is that the lender is only interested in one thing – getting repaid. They WILL work with cooperative borrowers who can demonstrate that current financial circumstances make the scheduled payment impossible – there’s only so much you can do.
Again, if these are government loans, current financial aid regulations limit your monthly obligation to 15% of your total income. One less heralded part of the Health Care Reform Act that was signed by the President yesterday will cut this maximum to 10% of monthly income.
Contact your lender, and explain your situation. They will forward forms for you to complete – forms that will enable them to assess your current ability to pay. Once they’ve evaluated your circumstances, they will offer you a more affordable payment plan – if you qualify.
I will say that their expectations of your ability to pay may be a little different than yours.
Good luck to you, and congratulations on completing your Chapter 13 plan.
May 1st, 2010 at 7:01 amYou are already accustomed to a tight budget. I would get two jobs.
May 1st, 2010 at 7:01 amuniversities.atwebpages.com – it provides some tips about applying to US federal and state grants for college students.
May 1st, 2010 at 7:01 am