I can barely pay my student loans. What to do?

Q. I can barely make my student loan payments and have heard that they might write off some debt? I don’t want to ruin my credit but I really can’t afford it. I’m unemployed and my benefits will run out soon and I don’t want to have to file for bankruptcy. What should I do?

– In trouble

A. Unfortunately, it is not uncommon to crush student debt.

There are several steps to approach this.

First, you need to determine if these are federal or private loans, said Karra Kingston, a bankruptcy lawyer in Union City.

“If these are federal loans, you may be able to get a income based repayment plan where you only have to repay a percentage based on your income, ”she said. “If it is private loans, refinancing may be an option.”

At this time, there is nothing definitive about whether a student loan amount could be forgiven through legislation, she said.

If you can’t pay off your student loans because you have other debt, then bankruptcy may be the best option, Kingston said, noting that in any case, the first step is to contact your lender to see if. it can put you on a lower monthly payment. repayment plan.

But keep in mind that student loans aren’t really unloadable bankrupt, Kingston said.

“The only way is to show that there is undue hardship which is very difficult to do, but there have been a few instances where people have fired them,” Kingston said. “A Chapter 13 Bankruptcy you may be able to help you pay off your student loan arrears over time.

Email your questions to [email protected].

Karin Price Mueller writes on Bamboo column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Register for NJMoneyHelp.com‘s weekly electronic newsletter.

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