Discharging Federal Student Loans in Bankruptcy Just Became Easier

Scott Waterman, Chapter 13 Trustee, Reading, PA


If a student loan borrower is having trouble making their monthly payment, bankruptcy may be an option.  When a Federal Court of Appeals blocked the Biden Student Loan Forgiveness Program in November 2022, borrowers thought their chance to free themselves from burdensome student loan debt had disappeared.  However, just three days later new guidelines were issued making it easier to discharge loans through bankrupty.


Can Student Loan Borrowers Use Bankruptcy to Get Rid of Debt?


students drinking coffee

Student loan borrowers can file for bankruptcy, but it should only be considered as a last resort, multiple student loan experts told Newsweek after the Supreme Court struck down the Biden administration's student loan forgiveness program on Friday.


Can you discharge student debt with bankruptcy?


grad with child

According to Studentaid.gov, you can have your federal student loan discharged in bankruptcy court if you can prove that repaying those loans would impose an undue hardship.


Biden administration launches new income-driven student debt repayment plan



The Biden administration is launching a beta website for its new income-driven student loan repayment plan today, officials told CNN, allowing borrowers to begin submitting applications for the program as federal student loan payments are set to resume in October.


New income-driven student loan repayment plan available to borrowers

The Hill

woman with laptop

The Department of Education released a beta website Monday for the Biden administration’s new income-driven student loan repayment plan, known as the Saving on a Valuable Education (SAVE) plan.


Planning to go Bankrupt is Not a Good Plan

Keith Rucinski,  Chapter 13 Trustee, Akron, OH

couple looking at laptop

Bankruptcy is designed to help individuals who have fallen on hard times to have an opportunity for a fresh financial start. The hard times are usually not by choice. Health emergencies can happen to anyone, often resulting in large expenses that insurance does not cover. Every year people start new businesses that are not always a financial success


Urban Legend #3 - I do not need a lawyer to file Bankruptcy

Keith Rucinski,  Chapter 13 Trustee, Akron, OH


In the United States people can choose to represent themselves in court, including bankruptcy court.   The term to represent yourself without counsel is “pro se”. A lawyer who represents people in bankruptcy does much more than “complete some forms.   Good counsel will help their client: Determine if a bankruptcy is necessary.  Sometimes there are alternatives. 


Experts: How To Know When It’s Time To File for Bankruptcy

GO Banking Rate

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Bankruptcy. It’s a word that evokes dread in many Americans. Why? Because it may feel like the end of the road, the last resort, the end, in a way, of the game of debt. But how does one know it’s time to file for bankruptcy? What happens when you file for bankruptcy and how does it impact your overall financial picture and existing assets? And finally, how can you rebound financially after filing? 


Debt Baggage You Carry Even After Filing for Bankruptcy

Keith Rucinski, Chapter 13 Trustee,  Akron, OH


The American bankruptcy system is designed to help the innocent person who has fallen on hard financial times earn a bankruptcy discharge (discharge is a legal term meaning to successfully complete a bankruptcy plan). The discharge prohibits creditors from filing lawsuits and wage garnishment to collect on past due debt, including credit card debt and medical debt.


Is Paying Off Chapter 13 Bankruptcy Early a Good Idea?








Sometimes called “wage earner’s plan” or “reorganization bankruptcy,” Chapter 13 bankruptcy is available for people who intend to repay some or all of their debt without liquidating their assets. It spreads the debt burden out into payments that are made over a three to five year period,  based on your income, allowing them to pay back what they owe through installments.


About Personal Bankruptcy

10 Bankruptcy Misconceptions That Berleth & Associates Warns Could Be Holding You Back

Digital Journal

man looking to future

Bankruptcy is a legal process that could be used by individuals, corporations, and other entities that cannot repay their debts. It is often considered a last resort for those who are struggling financially. However, many people have misconceptions about bankruptcy that prevent them from seeking help when needed.

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Understanding the Statement of Financial Affairs in Bankruptcy

J.D. Supra

man reading paper

When filing for bankruptcy, one of the essential forms you’ll need to complete is the Statement of Financial Affairs. This form provides a comprehensive overview of your financial history.

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The different types of bankruptcy with their meanings and definitions


couple looking at laptop

The US bankruptcy code has six types of bankruptcy, each tailored to specific situations.

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The Emotional Cost of Bankruptcy and Insolvency


couple looking at laptop

Personal bankruptcy is not a topic that is relevant to most of us – until it is. The number of people filing for bankruptcy over the last 20 years ranged from a low of 374,000 in 2022 to over 2,000,000 in 2005.

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Financial Planner Says Who Should File Bankruptcy

Business Insider

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Are you feeling overwhelmed by your debt? You're not alone. Consumer debt — especially credit card debt — is at an all-time high as rising interest rates and high inflation continue to place financial pressure on Americans' budgets.


What Are The Pros And Cons Of Filing For Bankruptcy


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Bankruptcy has long had a stigma in the U.S. People who file for bankruptcy protection have been stereotyped as irresponsible, unethical or lazy. But many Americans find themselves facing bankruptcy due to an unexpected crisis, like job loss, a medical emergency or divorce. Bankruptcy is designed to give debtors a fresh start and provide relief from creditors. But filing for bankruptcy is a complex decision.


How Much Does It Cost To File For Bankruptcy? 3 Things To Know


man reading bills

Filing for bankruptcy protection can free you from burdensome debts and nagging bill collectors, but there’s a cost. Depending on the type of bankruptcy, consumers may have to pay a few hundred to several thousand dollars to get relief from debt under the nation’s bankruptcy laws. For businesses choosing reorganization bankruptcy, the costs can be even higher.


What Chapter 13 Bankruptcy Is And How It Works

The Good Men Project

Chapter 13 Bankruptcy paper

Times are challenging in America with the coronavirus. You may be experiencing the stress that comes with financial hardship and are considering a Chapter 13 bankruptcy. The purpose of this article is to inform you about the most important things about Chapter 13 bankruptcy.


What Can Cause My Chapter 7 Bankruptcy To Be Denied?



Was your Chapter 7 bankruptcy denied? If so, you may be wondering what happens next. First, you should understand why your Chapter 7 bankruptcy can be denied. So, What Will Cause a Chapter 7 to be Denied? If you are found to hide assets, transfer assets prior to filing, and/or provide incorrect fair market values for your assets, you may be charged with fraud in your case.


Chapter 7 Bankruptcy: What Is It, and Is It Right for You?

Forbes Advisor 


Chapter 7 bankruptcy is the bankruptcy filing most often used by consumers. It provides protection from creditors, puts a stop to most collection efforts and can eventually wipe debts away. Debtors have to agree—theoretically, at least—to hand over their property so it can be sold to generate cash to pay the people they owe. And borrowers can’t avoid repaying some kinds of debt.

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Fresh Start

Can You Get A Small Business Loan After Bankruptcy?

Forbes Advisor

loan desk

Navigating the financial world after bankruptcy can be difficult, especially if you need to secure a small business loan. However, it’s not impossible. Despite common misconceptions, acquiring a small business loan post-bankruptcy is achievable, though you’ll need to prepare before doing so.

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Do Bankruptcies Show Up on Background Checks?

The Law Dictionary

loan desk

Many job applications today require background checks. If you’re one of the more than 500,000 Americans who have declared bankruptcy in the last year, you may be nervous about what a background check may reveal. You might also be asking, Do bankruptcies show up on background checks?

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Will I ever qualify for a mortgage after filing for bankruptcy?



While a bankruptcy can alleviate your debt, it also puts a major scar on your credit score. But the good news is that blemish on your credit isn’t permanent.

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How Long After Bankruptcy Can I Get a Car Loan?


family car

The time it takes to get a car loan after bankruptcy can depend on whether you filed for Chapter 7 or Chapter 13 bankruptcy. It’s also necessary to shop around to find lenders that work with borrowers after bankruptcy.

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How Long Does Bankruptcy Stay on Credit Report

USA Today

man working on budget

Bankruptcy offers relief to people that have fallen on hard times and are struggling to keep up with their debt payments and other expenses. Though bankruptcy can be the best option in some situations, it’s important to understand the potential consequences on your credit reports so you can make informed financial decisions.


How to get a car loan after bankruptcy

Business Insider

car and calculator

Bankruptcy can offer lasting financial relief to people struggling to repay their debts, but it comes at a cost. A bankruptcy filing can stay on your credit report for up to 10 years, flagging you as a risk to lenders. This can make it harder to get approved for new, affordable loans until you rebuild your credit. Here's how bankruptcy can affect your chance of getting a car loan.


Leaving Chapter 13 Bankruptcy Protection Early

Malibu Arts Journal

man looking determined

Filing for bankruptcy can be a difficult and stressful process, but it doesn’t have to be. Chapter 13 bankruptcies allow you to create a repayment plan that is approved by your creditors and the legal system. This type of bankruptcy differs from a chapter 7 bankruptcy, which uses your assets to pay off your creditors.


Is 401(k) safe in bankruptcy?

Bankrate - May 27, 2022

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If you are filing for bankruptcy, you will likely be relieved to hear that, yes, your 401(k) is generally safe in bankruptcy.


Buying A House After Bankruptcy

Forbes - Nov. 30, 2021

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Buying a house can be a challenge in itself, but if you’ve had to file for bankruptcy, owning a home may seem all the more difficult to achieve.

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5 Ways to Get Financing With a Bankruptcy in Your Past

The Motley Fool - Dec. 15, 2021

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Just because you've had a bankruptcy doesn't mean you can't get financing to invest in real estate. Find out how.


How Bankruptcy Works

Can a debt collector try to collect on debt discharged in bankruptcy?

Yahoo Finance

man answering phone

After filing for bankruptcy and getting your debts discharged, you are probably heaving a sigh of relief. You are looking forward to a fresh start, having put your debt behind you.


Before And After Chapter 7 Bankruptcy, There Is A Big Risk Of Spending Money

Fox Chronicle

lawyer explaining bankruptcy

Chapter 7 bankruptcy can be a helpful tool for people who are struggling to keep up with their finances. Once your case is resolved, many of your unsecured debts, such as personal loans and credit cards, can be cleared under a court order. This can provide some relief from debt collectors contacting you or garnishing your wages.


Justices Say Bankruptcy Can’t Erase Debt From Others’ Fraud

Bloomberg Law

lawyer with gavel

The US Supreme Court ruled that a bankrupt California woman can’t wipe out debts incurred through her husband’s fraudulent conduct in a home sale. Kate Bartenwerfer had argued that she was unaware of her husband’s actions. But she can’t use bankruptcy to discharge the debt obtained by fraud, the high court said in a unanimous decision Wednesday.


How Chapter 7 and Chapter 13 Bankruptcy Calculators Work

GIS User

couple looking at calculator

If you’re looking into Chapter 7 bankruptcy or Chapter 13 Bankruptcy, you may come across information regarding the bankruptcy means test calculations. The bankruptcy means test which can be quite confusing when you visit the government website, so a Chapter 7 or Chapter 13 calculator can help you in your endevour. The big question is whether you meet the eligibility requirements for Chapter 7 bankruptcy using the means test.


What You Need to Know About US Trustee Audits of Bankruptcy Cases

MoneyWise Law

lawyer explaining bankruptcy

The U.S. Trustee Program is responsible for overseeing the administration of bankruptcy cases. As part of this duty, they regularly audit Chapter 7 and Chapter 13 bankruptcy cases. If you’re contemplating bankruptcy, you should know about these audits and what they mean for your case.


What To Expect During An Initial Consultation With A Bankruptcy Attorney

Lawyer Monthly

Bankruptcy 1

Many feel uncomfortable talking about it, even with a trusted friend or family member. The simple mention of the word can bring up a wide range of feelings. 

Fortunately, a bankruptcy attorney understands that you are going through a very trying and emotional moment. They’re mindful of the fact that most bankruptcies are caused by events outside of your control, such as the loss of a job or a serious health problem. No bankruptcy attorney will ever blame or pass judgment on their client. Instead, they assist them in finding a workable solution to their financial woes, including credit counseling and debt settlement.


How To File For Bankruptcy


women and bills

Feeling crushed by debt is stressful, but there are options. If you find yourself saddled with more debt than you can pay off in a timely manner, you can file for bankruptcy. Filing for bankruptcy is a serious step and one that often comes with negative connotations. Some people worry that it’s a sign of failure or that they’ll then carry a financial stigma that will affect their credit. However, sometimes bankruptcy is the best way to get a new start.


How Long Does It Take to File Bankruptcy?

Vents Magazine


When considering filing for bankruptcy, many people wonder how long it will take. The process can vary depending on the type of bankruptcy and the individual’s case, but in general, it is usually a few months from beginning to end.


How Chapter 13 Bankruptcy Works in Texas

Legalreader.com - June 1, 2022

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You may make a good income but are unable to afford your debts, so you are looking at a Chapter 13 bankruptcy in Texas. Filing Chapter 13 bankruptcy is a big decision. You are committing to a bankruptcy repayment plan that could last for up to five years.


Will My Income From Cannabis Affect My Bankruptcy?

Lawyers.com - May 31, 2022


Are you considering filing for bankruptcy? Do you receive any income from the sale of cannabis or cannabis products? 


Recent News

Today On the Table: filing for bankruptcy can now protect you from student loans

Fox 2 Detroit - Dec. 8th, 2022


The Biden administraiton has made it easier to file for bankruptcy and cover student loans. But is that a smart financial step?


Study Reveals Racial Bias in Bankruptcy Cases

Ebony - Nov. 2, 2021

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According to a recent study, approximately 30 percent of African-American filers are more likely to have their bankruptcy cases dismissed than non-Black bankruptcy filers, Yahoo News reports.

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Bankruptcy Filings Continue Steady Drop

US Courts - May 17, 2022

us courts

Bankruptcy filings continued a steep two-year-long fall that coincided with the start of the coronavirus (COVID-19).


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The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion, or any other advice on any specific facts or circumstances. You should not act or refrain from acting upon this information without seeking professional advice.