Valuing your education is incredibly important, and for many Americans, going to college and getting a degree is a life goal and major milestone. However, with going to college means having to take out student loans. Sometimes, the amount of student loans is enormous, and many former students will find themselves in an incredible amount of debt after school. Usually, after a few years the debt can be repaid, but often students will find themselves running out of options on reimbursement. Students can file for bankruptcy in certain cases, but here are a couple of alternative methods of repayment before going that route.
Other Repayment Options
There are a few other ways that students can repay their student loans before filing for bankruptcy. One way is to defer your loans. Deferment is a federal repayment option that allows you to pause your student loan payments for up to three years. This option gives you a lot of breathing room, and lets you pay for other bills without hurting your credit. However, if you have unsubsidized student loans, the government won’t cover the interest that collected on your debt, so you’ll loan amounts will be growing while you’re in deferment. Forbearance is similar to deferment; you can stop making payments for up to a year, whether it’s mandatory or discretionary.
If, after three years, you still are struggling to repay your loans, you can to re-apply for deferment or forbearance. If these other options don’t seem to work for your specific financial circumstances, bankruptcy can be the best option for you. If you’d like to know how you can declare bankruptcy to help with your student loans, contact the bankruptcy law firm of Kevin D. Judd.