New college graduates are not experienced in financing debt. It should come as no surprise that they are nervous when they start seeing the bills for their student loans. Many do not have good paying jobs, and they worry about being able to make ends meet. Desperation can cause them to consider filing for bankruptcy due to their student loans. It is not the smartest idea because it can place financial wellness at risk.
You Can File
It is possible to file for bankruptcy based on the student loans, but it is not easy for all. The Brunner test is used to determine if an undue hardship has been caused by the education loans. There are three elements to the test.
- The individual needs to prove that paying the loan will deny him or her the ability to maintain at least a minimum standard of living.
- The financial situation of the individual must have little chance of changing in the future.
- A good-faith effort has been made to pay the student loans.
If the criteria are met, then the person has a bankruptcy lawyer file what is known as an adversary proceeding. If all goes well, then bankruptcy will be allowed.
Why Do It?
If you have a fair amount of student debt already, you can expect your debt problems to get bigger with a bankruptcy file. The initial reason is that you have to pay a lawyer to do the work, and this is going to cost a sizable fee. Assuming that you are able to be awarded bankruptcy, do not think that your financial troubles are over. They will get worse. The damage to financial wellness will include lower credit scores and difficulty in getting new loans, including mortgages. There will be a number of years in which you will have to struggle with finances because bankruptcy has some very stiff obligations.
You may have some options besides bankruptcy you do not even know about. There is more than one way to get out from under substantial monthly payments, but you need some good advice in order to do this. Countrywide Pre-Paid Legal Services understands how the recent college graduate gets frustrated by the monthly bills. We have a financial wellness plan that connects a stressed-out graduate with the right kind of advice.
We have professional counselors who are very familiar with college loan repayment options. These experts can sit down with a plan member and explain the ins and outs of repaying debt. It usually happens that the plan member is not aware of some fairly simple ways of dealing with the problem. The counselor guides the individual through various strategies, making him or her aware that bankruptcy is not something that needs to be used.
Anyone stressed out by college loans needs help as quickly as possible. Countrywide is a streamlined administrative process so financial wellness assistance can be obtained. No one has to wait extensive periods of time to get an appointment with a counselor. These people are held to very high ethical standards and are expected to give good advice. It is the type of high quality service Countrywide wants to provide any financial wellness plan member.
Student loan debts can be managed without having to file for bankruptcy. Of course, there are other financial issues which a person and family may be confronted. Countrywide has a number of options for the plan which an organization can consider. If all the client wants is student loan counseling, that is all that will be in the financial wellness plan. However, there are some very attractive benefits that will help employees. Anyone who’s interested in our services should contact us as soon as possible.