August 19th, 2010 by Reed Allmand 
Most bankruptcy debtors are unable to discharge their student loans in bankruptcy, that’s why creating a viable plan for repaying student loans after bankruptcy is so important. Here’s what you need to know:
- Consider consolidating your student loans under the Direct Loan government plan. If you took out student loans that were backed by the federal government, consolidating those loans after bankruptcy could be beneficial. Consolidated student loans allow you to make one payment to one lender under one interest rate.
- Many debtors who file Chapter 7 bankruptcy are in fact unemployed at the time of their bankruptcy filing. If you are one of those unemployed bankruptcy debtors and you’re still unemployed once you receive your bankruptcy discharge, please contact your student loan lender to get a deferment. Even if your student loans are through a private lender, they may be willing to extend a deferment or at least reduce the amount of your monthly payment.
- Look at all of your repayment options after bankruptcy. Government backed loans are especially flexible when it comes to repaying your student loans. Government backed student loans are now offering loan forgiveness after 25 years of repaying the loan and you repayment amount is based on how much money you earn. If you are unemployed you could end up paying $0 per month and still have your student loan forgiven after 25 years of paying nothing.
- Keep in mind that although many legislators are pushing for the dischargeablity of student loans in bankruptcy, right now it is still difficult to discharge student loans and student loan creditors have wide reaching powers to collect. Bankruptcy will allow you to free up more income to repay student loans by discharging unsecured debts even if you cannot actually discharge the student loans in bankruptcy.
About Reed Allmand
Allmand's vision is rooted in his own financially precarious childhood in Abilene "My father always had difficulty holding a job and supporting our family, so after my parents divorced when I was 12, my sister and I got jobs to help make ends meet," he recalls. "I remember what it felt like as a child to worry that our car would be repossessed or home foreclosed on."
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