Can you get student loans after a Bankruptcy

justme1972 · May 31, 2008

This is not true. If she just doesn't pay the bills, she will either have write-offs on her credit report (VERY bad, in a league with bankruptcy) or she will have many records on her report that say she paid, 30, 60, 90 or more days late. That's not going to look any better than bankruptcy.
The best advice would be for the OP to talk to someone knowledgeable about bankruptcy laws. Then she can know what she's getting into. Then she can talk to the financial aid officer(s) at the school she wants to attend.
As for the Stafford Loan, you won't be denied for having a bankruptcy, but forget about private loans, as others have said. Especially these days, having good credit is essential to get a private loan. Although a really good (credit-wise) co-signer might be able to make that problem go away.

The bankruptcy laws are easy: You can't bankrupt student loans..period.

You have physicians and lawyers and pharmacists to thank for that change when they were routinely bankrupting 6--figure student loans almost immediately after graduation.

If you watch any of the financial shows, especially Suze Orman, she states this over, and over and over again.

A bankruptcy attorney cannot give you an opinion on your ability to obtain FUTURE credit. His job rests entirely with getting the paperwork together to go to bankrtupcy court and making sure that all accounts are included and property that is supposed to be retained, is retained.

Student loans are not credit score driven, but bankruptcies are catagorized as a "major financial event"...collections are not....charge-offs are not, judgements and reposessions and foreclosures ARE.

Charge-offs are bad but they are not the same as a bankruptcy. With a charge-off, the CREDITOR is giving up on collecting the debt..with a bankruptcy, you are claiming that you NEVER plan to pay the debt...that is the difference.

The dollar amount per charge-off makes a difference.

To the poster who had a business bankruptcy: Was it set up as an S-corporation or incorporated?

That makes a huge difference. If the BUSINESS was bankrupt, you were not...therefore, that is why you were able to get the loan.

There is a difference between having "no credit", "bad credit", and credit with a "major financial event".

It is very, very important that she speak with an underwriter of student loans...not a counselor, but someone in the bank who has actually had APPROVAL authority, who understands exactly what is allowed and isn't.

Loan officers don't approve loans, nor do loan counselors.

Otherwise, the OP is risking starting school and not having the money to finish it...which none of us want to see happen.

scootersuz, ASN · May 31, 2008

I just wanted to thank everyone for your input. It has really put me at ease that there is some hope out there.. although not absolute....... a chance at anything puts me at ease.

Thank you, Thank you

Suzie

sarita07 · May 31, 2008

It doesn't matter because our corporation was backed by our personal credit. We were able to keep our personals by reaffirming on our mortgage, house loan etc.

BreatheFree · May 31, 2008

You WILL be able to get federal financial aid. I am speaking from RECENT experience. However, you will have to submit bankruptcy and tax documents to the financial office for a process called verification. They will check to make sure you didn't default or file on any student loans because my financial aid counselor said that in some circumstances you CAN file bankruptcy on student loans. Anyways, it is possible. Good Luck!

Home Health Columnist / Guide · May 31, 2008

there are credit services out ther that will help you prevent bankruptcy and can get debts lowered ...see goverment approved list:

us trustee program/dept. of justice - credit counseling searchcredit counseling agencies approved by doj for pre bankruptcy counseling.

check their website for reliable info: credit counseling & debtor education information

as an fyi: all healthcare facilites are now required to perform a "sanction check" of employees and medical staff prior to hire. sanction check lists those that have committed fraudu against the us federal government, medicaid and medicare programs....defaulting on federal student loans is included along with practicing on long expired license.

one cannot be hired by medical facility nor provide/bill medicare/ medicaid healthcare services.

don't let your nursing career get stalled over this issue. best wishes for your future.

A tech · Aug 21, 2008

Not sure if i am too late to chime in on this topic but googled student loans after bankruptcy and this came up. I am currently a student and have two years left before i finish my degrees. I am in the last year of my bachelors in psych and after working in a psych hospital have decided to go get my RN too after im done. Too make short story long when i was 17 i moved out west and got into a lot of financial trouble. Now that trouble is beginning to haunt me with creditors threatning to garnish my wages. The only way for me to stop that from happening is to file chapter 7. I am afraid if i do that they will discontinue the stafford loans i have been revieving and without them i couldn't afford school. No one seems to be able to give me a for sure answer including my financial aid office. Anyone surprised. Well if anyone knows anything i seriously need some help

CracklinRose · Aug 22, 2008

I suggest talking w/Fin aide at your school to know for sure....they can give you accurate and factual info that you will need to move forward...I'd act quickly since they are going to garnish your wages and then I believe it becomes more difficult.

FLmomof5 · Aug 24, 2008

The ONLY hit filing BK would have on SL would be if you filed *recently* and SL's were included in the BK (this would cause a 'default' condition). SL's are not dischargeble in BK (except in extreme cases), but they are a debt and are included. The SL servicer cannot continue collection while you are in BK.

If you are NOT in default of any SL or FED DEBT, you will not be prevented from getting a Stafford loan but you will not be approved for a private loan. So a recent BK with SLs included would make you in default of a Federal debt. If you dont have SL's or past due taxes in your BK, you should be OK.....unless you file a Chapter 13. Under chapter 13 (and chapter 7) you cannot get new credit while in BK without the approval of the Trustee. Chap 7s take about 3 - 4 months to get your discharge, so you are good to go after that. Chap 13s can take up to 5 yrs. That *could* prevent you from getting a loan....ANY loan.

Like others said: Check with your FA office!!!

An earlier post stated that we have "doctors and lawyers to thank" for this provision (SL non-dischargebility). That is not the case. Stafford loans are federally guaranteed. When a student defaults, the federal government pays the bank the defaulted amount. The federal government decided to stop the discharging of student loans because it is the federal coffers that suffer. Yes, doctors and lawyers defaulted on their student loans but so did many other graduates.

Before you get judgmental of the doctors....when they graduate from school, they have the same 6 month break before repayment that we all get. Now LOOK AT WHAT INTERNS ARE PAID! Then look at what they owe! I am surprised any of them manage! The press wanted the public to believe that the defaults were selfish and that these docs were being paid 6 figure incomes. Interns didn't get 6 figures. Their debt, however, WAS 6 figures in many cases.

Let's not propagate misinformation here. OK? :heartbeat

BTW, I filed BK years ago when SL were dischargeble. The last part of my SLs were discharged. (I had paid 6 yrs worth.) I still got Stafford loans. I contacted the FAFSA folks to find where to look and determine I was still eligible. Whew.

Filing BK is embarrasing for us otherwise responsible folks. It is challenging to live w/o credit for a time, but it really only takes about 2 yrs to begin recovering and get new credit. (FICO docks less pts for a late that was over 2 yrs ago.) BK is not a death sentence.

scootersuz, ASN · Aug 24, 2008

Thanks So Much For All The Feed Back. I Have Not Done Anything Yet. I Certainly Helps Me Get An Idea Of What Some People Went Through. There Are No Wages To Garnish But My New Question Is Does Anyone Know If They Can Withhold Or Take Student Aid Amounts Either In Bk Or One Of The Creditors?

CuriousMe · Aug 24, 2008

Thanks So Much For All The Feed Back. I Have Not Done Anything Yet. I Certainly Helps Me Get An Idea Of What Some People Went Through. There Are No Wages To Garnish But My New Question Is Does Anyone Know If They Can Withhold Or Take Student Aid Amounts Either In Bk Or One Of The Creditors?

I would talk to a bankruptcy lawyer, that way you know the information you get is applicable for your situation in your state.

Getting legal advice on message boards is just like getting medical advice on message boards, ultimately a bad idea.

scootersuz, ASN · Aug 24, 2008

I Agree , Of Course, I Would Not Make Any Decisions Without Talking To An Attorney Which I Have Done On Two Different Occasions With Two Different Attorneys. The Next Time I Talk To Them They Will Charge Me So It Is Nice To Get Some Ideas From Other People And Their Experiences So I Am Better Prepared With More Focused Questions. One Of The Great Things About These Forums Is That You Really Get So Much Information From So Many Different Sources With People Experiences. In Many Instances I Have Found That I Find Out So Many Things So Much Faster Than Before The Internet. What I Do Know Now That I Did Not Even Think Of Before Is That You Cannot Discharge Student Debt And That During The Bk Process You Cannot Get Loans.

Thanks

Scootersuz

HeatherTN · Aug 24, 2008

Just wanted to wish you all the best!! Also wanted to add that I worked for the WIA (workforce investment act) for several years and they will pay tuition, books, fees, and possibly uniform expenses. It is a federal program desinged to help people get back to work...they will not pay for a bachelor's degree but pay for an lpn program or assoc degree....this is a grant you would not pay back and you can find your local WIA folks thru you local dept of labor office (unemployment)

good luck!!

Heather