Student Loan Debt Leading to Bankruptcy
Many college students end up with major debt when they step out of their commencement ceremonies. Out-of-control student loan debt is a major problem with rising tuition costs. Many parents of college students are even taking out parent loans to pay for their children’s college education. As an experienced southern California bankruptcy attorney, I see parent loans like this go into default all the time. It often leads to lawsuits and garnishments. To avoid the type of student loan debt (and parent student loan debt) that leads to financial trouble and bankruptcy all the time, learn as much as you can about student loan debt and bankruptcy and consider the alternatives.
If you’re planning to attend a public university that requires you pay out of state tuition, you can move to the state to establish residency so you can pay in state tuition instead. Some schools may be willing to defer your acceptance for a year while you work so you can meet the in state tuition requirements.
- Delay school if it will avoid a significant amount of student loan debt.
- Increase the amount of time you have to work (earning your tuition payments) by taking fewer credits. This will also decrease your tuition costs per semester (as most colleges charge by the credit). It will increase the amount of time you are in school, but it will be worth it if you are able to walk away with a significantly lower amount of debt. If you plan it right, you could make the money necessary to pay your tuition and only take out student loans for living expenses.
- Watch out for grants and scholarships and tuition assistance programs. Many of these programs are no longer available because of funding cuts, but constantly watching for free money to pay for tuition and living expenses while in school could truly benefit you.
Walking away from college without crushing debt is worth some extra work. Many view student loan debt as an acceptable form of debt like a home or car loan, but it is also at least semi-avoidable. Doing so could make a big difference later.
For additional tips on how to avoid bankruptcy and crushing student loan debt, contact the southern California bankruptcy attorneys at Westgate Law.