Your college education is one of the largest investments you can make. By the time many people complete their education they are often in hundreds of thousands of dollars in debt and while the debt may seem unmanageable at the time, skills and training that you take on can often help you to achieve greater career advancement and higher earnings. College debt remains one of the most common reasons that people are filing for bankruptcy. In many cases bankruptcy can become a necessity before people finish their education. If student loans are not yet due to be paid, the price of the loan can accumulate over time. Although it’s quite common for many older people to file for bankruptcy after they’ve completed school, there’s an increasing number of individuals that are filing in their mid-to-late 20s while they are still attending.
The Types of Bankruptcy
There are many types of individual bankruptcy that a person can apply for such as a chapter 13 bankruptcy that will allow individuals to retain ownership of their assets and make payment on their student debt over the next 3 to 5 years. A chapter 7 bankruptcy will require a complete liquidation of assets; you can give up on the ownership of your assets in exchange for the discharge of a debt.
You may be avoiding bankruptcy because it could leave you unable to qualify for financial aid. Money that’s been received by the federal government including Pell Grant money is something that’s exempt from bankruptcy cases. You won’t need to worry about losing funding on college grants if you file for bankruptcy.
If you are considering filing for bankruptcy in an effort to get out ahead of student debts, it could be wise for you to choose to file early so that you can prepare for your professional future without looming debt.
This post was written by Trey Wright, one of the best Bankruptcy Lawyers in Tallahassee Florida. Trey is one of the founding partners of Bruner Wright, P.A. Attorneys at Law, which specializes in areas related to bankruptcy law, estate planning, and business litigation.
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