The high and continually rising cost of higher education seems to all but force many people in Mississippi to take out student loans in order to fund their college degrees. In theory, these loans can be very valuable and if a person is able to get a job that pays enough after college, they may be able to repay all of their loan debt. Yet, it seems that many consumers today struggle with many types of debt and student loans are part of that challenge.
For some people, help may be available via bankruptcy but discharging student loans in a bankruptcy is anything but easy or automatic. As explained by U.S. News and World Report, there are three criteria that are evaluated before a person is allowed to include student loans in a Chapter 7 bankruptcy. One of these is whether or not the consumer can demonstrate that they have made good faith efforts to make their loan payments.
Another factor considered is the nature of the financial challenges and if they are expected to last for a lengthy time. Finally, the quality of lifestyle that a person may be able to afford if they are forced to repay their student loans is looked at. Together, these things help a court decide if the loans are causing an undue hardship on the borrower and whether or not they may be included in the bankruptcy.
One lawmaker has introduced a bill that would expand the scope of what may be deemed an undue hardship so that more people may be able to excuse their student loan debt via bankruptcy. If passed, this may offer hope to many consumers.