Obtaining a college or professional school degree may be your gateway to a bright future. If you don’t have the funds, taking out student loans may be the best solution for you. The following guide will help you understand your responsibilities when receiving federal or private loans.

Common Questions About Owing Student Loans

I just graduated. When are my loan payments due?

When you must start repaying your debt depends on the type of loan you have. For example, Federal Direct Loans, Stafford Loans, and some private loans have six-month grace periods after graduation before the first payment is due. By law, all lenders must provide a payment schedule, which is usually sent shortly after students graduate or leave school. Contact your lender or a lawyer if you do not receive such a notice.

I was paying my loans but just lost my job. What can I do?

You may be eligible for a deferral or forbearance while you are unemployed. These options stop or reduce payments temporarily. Be aware that if you are expecting a tax refund and can’t pay your federal loans, the Department of Education may seize your refund. 

Does filing bankruptcy wipe out student loan debt?

Generally, filing bankruptcy does not discharge or wipe out the debt. However, in rare cases where debtors prove undue hardship, the courts cancel the debts. Starting the process requires filing an adversary proceeding within the bankruptcy case.

Are there options to cancel loans outside of bankruptcy?

Yes. Federal student loans can be canceled for reasons such as the school at which you used the loan engaged in fraud or predatory lending practices, or closed while you were attending. Working in public service can lead to cancellation under the Department of Education’s public service loan forgiveness program. Other options include serving in the military or reserves.

If you are weighed down by student loans, a bankruptcy lawyer can help you reduce your burden. At Padgett & Robertson, Attorneys at Law in Mobile, AL, bankruptcy lawyers offer more than 35 years of experience helping people in Southern Alabama obtain relief from student loan debts. These dedicated and compassionate attorneys will work with you to file the necessary paperwork and be your advocate throughout the process. To learn more about their services, visit the law office’s website. Call (251) 342-0264 to schedule a free consultation and detailed financial analysis.

No representation is made that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers. We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.