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Tennessee judge refuses to allow student loans to be discharged

For many younger Chattanooga residents, they are facing an incredibly large amount of student loans that have to be paid back. Unfortunately for them, it is extremely unlikely they would be able to get relief from them via bankruptcy.

It is a somewhat well known rule that student loans are one of the few types of debt that cannot be discharged via bankruptcy. This is true unless there are extreme circumstances. Still, one recent law graduate attempted to get relief from his student loans via bankruptcy but was denied. The law graduate was not able to look for work as a lawyer because he was not licensed due to citations related to alcohol and motor vehicles.

The man attempted to discharge his loans, but the judge did not rule in his favor because it is not evident that the man is suffering from any illness or disability. The man also has no dependents. Moreover, the man seeking debt relief did not prove the likelihood that his financial situation will not improve due to outside forces. Some of these circumstances that may have enabled him to try and discharge some of the $250,000 in debt he has accrued.

Filing for bankruptcy is often seen as a last resort by many who have accumulated so much debt that they now can find no practical way to dig themselves out of that hole. Though it cannot typically be used for student loans, it is often used to handle credit card debit, medical expenses, foreclosure and most other financial challenges. Furthermore, after extended unemployment, it may be necessary to deal with the significant amount of debt someone has accrued even for basic living expenses.

For many, unexpected life changes, as opposed to bad choices, lead to a need to eliminate debt. Filing for bankruptcy is often the best way to get a fresh start. The first step is to understand the process. A qualified professional can guide one through the process and determine all of their options.

Source: The National Law Journal, "Judges Refuse To Allow Students To Discharge Debt," Karen Sloan, July 22, 2013

Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-624-4002
Toll Free: 800-257-7594
Fax: 423-624-0509
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