Under most circumstances, declaring bankruptcy will not discharge your student loan debt. This means that you will still be required to pay back your student loans.
However, when you file for bankruptcy, you are granted temporary relief from harassing collection activities. If you are in default on your student loans, the temporary relief from collection provided by bankruptcy law may give you the time you need to get caught up on your payments. Additionally, you may be able to restructure your existing student loans in order to make your payments more feasible.
As long as you either are not in default status on current loans or have made a certain number of satisfactory payments on loans previously in default, a bankruptcy will usually not affect your eligibility for future federal student loans.
While student loans are generally not eligible for discharge under existing bankruptcy law, the law does provide certain specific exceptions for discharge, including "undue hardship." A qualified Michigan bankruptcy attorney can review your case and inform you if you meet the requirements for such an exception.
To learn more about how filing for bankruptcy may affect current and future student loans, please contact the Michigan bankruptcy attorneys at Johnson & McLoyd, PLC, for your free initial consultation.