Non-Bankruptcy Solutions for Student Loan Debt
If you’re burdened with student loan debt and you’re having a hard time making the payment on a fixed income, but the loans are still in good standing — contact one of the Lee & Sanchez attorneys to learn about income-based repayment options.  Although Bankruptcy doesn't discharge student loan debt without costly, drawn out litigation with results that generally favor student loan lenders, Chapter 13 can often function as a "breather" from student loan debt collection.  Unfortunately, as the law stands currently, at the end of the Chapter 13 case, student loans are not discharged, interest accrued during the Chapter 13 plan, and the government (or one of their servicers) is free to pursue you again.  However, there are other options...

Income-driven repayment plans are available to all borrowers, and there are also some new options available for older student loan holders. If you are interested in learning more, just use the U.S. Department of Education’s Repayment Estimator to explore eligibility for income-based repayment plans and possible payment amounts.

After 25 years of payments on this plan, any remaining balance is forgiven, and that is reduced to 10 years if you are currently employed in public service.  

There is a newer version of income-based repayment called Pay As You Earn that’s slightly more generous, but is only available for loans taken out in recent years. If you have older Federal Family Education Loans, you’re not eligible for these plans, but you can use a similar plan called income-sensitive repayment.
With income-sensitive repayment, you can choose a monthly payment amount between 4 percent and 25 percent of your monthly income but can only use the plan for five years.

Another option often overlooked is seeking an Administrative Discharge of student loan debt.  This option is available for borrowers who are disabled and unable to work in order to repay their loans.  Being approved for disability through Social Security or Workers Compensation may satisfy the requirement to have student loans administratively discharged.  But it is not the only way.  A physician can submit documentation on your behalf to the Department of Education supporting a determination that your student loans should be administratively discharged.  Although no legal proceeding is required, we recommend contacting our office to set up a free consultation in order to learn more and discuss the options that appear to be becoming increasingly available to student loan borrowers.