Can I file bankruptcy against student loan lender that is garnishing my paycheck?

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Can I file bankruptcy against student loan lender that is garnishing my paycheck?

Asked on July 26, 2014 under Bankruptcy Law, Georgia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

Unfortunately, almost certainly not. By law, there are certain debts that bankruptcy either never or rarely works against, and government backed, guaranteed, or insurered student loans (like the ones you get from student loan lenders) are one of those debts that bankruptcy is almost never effective against. Technically, if you can show "unreasonable hardship," you can use bankruptcy against  a student loan; but this means showing, basically, that you can't eat or have a roof over your head if you have to pay the loan (not just that that paying it is a hardship; essentially, that paying it renders you homeless) *and* that  you do not have any reasonable chance of making more money to be able to cover it, whether by getting a better job, working more hours, etc. This is a *very* difficult showing to make; I believe that 1% or less of people who try to use bankruptcy vs. student loans are successful.


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