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My Student Loan payments are almost as much as my house! Should I file bankruptcy?


Mon, Oct 31st, 2011
Posted in Ask the Expert

Scott Spring, Attorney

No - not for that reason. Student loans are generally not dischargeable unless repayment causes an "undue hardship" on you and your dependents.

 "Isn't paying a second house payment to Sallie Mae an undue hardship?" That answer is also "No," but you are part of the way there. Many courts have defined "undue hardship." In general, to find undue hardship, the court looks at your income and expenses to determine your standard of living with the student loans. They also take into account what other circumstances might continue through the repayment period to determine your financial condition while you are repaying those loans. Finally, the court looks at whether you have made a good faith attempt to repay the loans. Oftentimes these factors boil down to whether you have a physical or mental disability and the effect repaying your student loans has on your disability.

 For advice about bankruptcy, business and estate planning, real estate, divorce, personal injury or any other legal needs, contact us.

Springer & Gumbel, P.A.

141 W. Fillmore St.,

Preston, MN

Phone (507) 765-3600

www.scottspringerlaw.com/

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