Bankruptcy and student loan collection are prevalent concerns of those who have had to make the difficult decision to file for bankruptcy. Consumers have recently complained that lending companies have tried to illegally collect student loans, which were supposed to be dismissed through bankruptcy.

Bankruptcy and student loan collection is also a very complicated situation to navigate, as many consumers who have students debts may not be aware that they may be off the hook. Students who have private “career training” student loans and have been going through bankruptcy since 2005 may not have to repay their student debts or be subjected to harassment by debt collectors or agencies.

This is because career training loans that may be dismissed through bankruptcy were made by private or for-profit lenders, and were not made to the student for “qualified educational expenses.” In other words, these loans were not used for a four university or other educational purposes. Discharge student loans in bankruptcy can include:

• Airline Training School Student Loans
• Flight Schools Student Loans
• Tractor Trailer School Student Loans
• Culinary School Loans
• Bar Exam Loans
• Study Abroad Loans
• Caribbean or other Foreign Medical School Loans
• Cosmetology School Loans
• Paralegal School Loans
• Heavy Equipment Operation School Loans
• Tutoring Loans
• K-12 Student Loans
• Medical Billing School Loans
• Non-accredited Medical School Loans
• Medical School Residency Loans
• Art School Loans
• Fitness School Loans
• Holistic Health School Loans
• Mechanic School Loans

Overview of Bankruptcy and Student Loan Collection

Bankruptcy is declared when the consumer proves that they cannot pay back the debt under reasonable circumstances, and proves that they would have paid the debt had they had the money. So if the consumer proves they remain in financial turmoil due to the loan, and will be unable to pay it back then the student loan will most likely be dismissed.

Other factors that go into whether or not bankruptcy is declared is the consumer’s employment and income, education level and job prospects, health, and any dependents that may be involved in the consumer’s family. Bankruptcy is supposed to protect consumers from aggressive collection efforts, by dismissing the alleged debt.

Even though this bankruptcy and student loan collection policy is firmly in place to protect students from constant harassment, some collection companies have been reportedly attempting to collect on these dismissed loans. Consumers may be able to file legal action against debt collection companies, if they continually face troubling phone calls regarding bankruptcy and student loan collection.

Under the Fair Debt Collection Practices Act (FDCPA) and bankruptcy discharge orders, debt collectors are not allowed to persistently call or harass consumers to collect on an alleged debt. Potential claimants should contact a specialized lawyer to determine eligibility for a student loan lawsuit.