Debtors who have been through student loans bankruptcy discharge have rights that protect them from continuing debt collection.

In America, the cost of education is steadily rising. According to the National Center for Education Statistics, the average yearly cost of a higher education was $4,885 in 1985 but has risen to $22,432 as of the 2015-16 academic year. Most students are unable to cover the costs of their tuition entirely through scholarship and federal aid, leading many of them to pursue private education loans.

If a student is credit-worthy, or has a credit-worthy cosigner, they can fund their college costs through private loans. These loans are typically deferred from payment until after a student graduates or leaves school. However, once out of school, many individuals are forced to pay huge payments on their student loans which can prove to be a serious financial burden. In some cases, the pressure of paying student loans and other costs may lead individuals to file bankruptcy.

Although bankruptcy can eliminate huge debts and protect from future debt collection attempts, many individuals find themselves victims of debt collection on their private loans after the process. Legal experts have investigated the issue and found that hundreds, if not thousands, of student loan debtors are in this exact situation and are unaware of their legal rights. Knowing your rights as a student loan debtor who has declared bankruptcy is vital, as you may be able to reduce or eliminate your debts.

The conventional belief that bankruptcy does not erase student loans is not necessarily correct. Although the process is more restricted following the 2005 passage of the Bankruptcy Abuse Prevention and Consumer Protection Act, student loan debtors can undergo the student loans bankruptcy discharge process to reduce or eliminate their loans.

For most student loans, if an individual can prove that their student loans cause “undue hardship”, they may be eligible for the student loans bankruptcy discharge process. To prove undue hardship, individuals must pass the Brunner test and show that the following is true for their situation:

• They can’t maintain a minimum standard of living for themselves and dependents.
• Their financial situation isn’t likely to change during the student loan’s term.
• They’ve made good faith efforts to repay the loan.

If an individual is able to prove this in a court of law, they may be eligible to reduce or eliminate their private student loans through the student loans bankruptcy discharge process.

Certain private loans may be easier than that to discharge. Debt that was incurred for education at a non-qualifying institution, for a courseload that was less than half-time, or for more than the school’s recognized cost of attendance may fall outside the restrictions of the 2005 act, making them dischargeable like other unsecured debt.

Debt collectors may run afoul of federal law if they attempt to collect a debt that has been discharged in bankruptcy. If you have already undergone the student loans bankruptcy discharge process and are still being harassed by debt collectors, you may be eligible for compensation. Filing a student loans bankruptcy discharge lawsuit could recover compensation for violations of the Fair Debt Collection Practices Act (FDCPA). Fill out the form on this page to request an evaluation of your claim by a qualified attorney.

DISCLAIMER: Debt collection itself is not illegal. However, creditors and debt collection firms collecting on consumer debts must adhere to the FDCPA and respect bankruptcy discharge injunctions. Even though consumer debt attorneys are investigating these companies, their debt collection practices may be legal.