If Ihave a student loan and am now on disability and can’t pay, can my SSDI be garnished?

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If Ihave a student loan and am now on disability and can’t pay, can my SSDI be garnished?

Asked on November 28, 2011 under Bankruptcy Law, Tennessee

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If you are receiving Social Security Disability Income (SSDI) federal law protects your benefits from being garnished by creditors for most debts (e.g. credit cards, medical bills, payday loans, personal loans, etc.). However, there are certain creditors that can attach or garnish your SSDI benefits. The federal government is one. So if you owe taxes, child support or spousal support it can garnish your benefits to cover past due taxes or support payments. Additionally, if you owe federal student loans then your benefits are also subject to garnishment. If you owe student loans it is very important that you find a way to resolve these debts before you are forced to pay them back through SSDI payments.
 
While virtually all student loan debts are non-dischargable in bankruptcy, if you may be able to get your loans discharged if repayment would present severe hardship. This is a difficult standard to meet. In deciding whether or not a genuine and "severe hardship" exists, the court will consider your income/expenses, the reason for non-payment, how long this reason(s) is likely to continue, and how hard you tried to make you payments.  

An alternative to bankruptcy also exists. Depending on the type of student loan that you have, you may be able to cancel it if you have a disability or severe economic hardship. In some cases, you may not be able to cancel the entire loan but you may be able to get rid of a portion of it. For more information you can contact The Student Loan Borrower Assistance website at: www.studentloanborrowerassistance.org discusses conditions for the cancellation or deferment in more detail and how to apply for such a cancellation.  You can also contact your loan holder or the Federal Student Aid office at:  http://www.ed.gov/offices/OSFAP/DCS/index.html) to determine if you qualify for cancellation.


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