The Obama Administration’s student loan forgiveness program is in full effect. Before you get too excited, however, keep in mind that the federal bailout only extends to schools affiliated with Corinthian Colleges. The Department of Education announced Monday that they will be forgiving billions in debt for students who claim they were bamboozled by the now-defunct for-profit chain’s use of artificially inflated job-placement rates in their marketing and promotional materials. As a result of a federal investigation, the chain lost its right to collect federal student loan dollars; the schools have since folded due to lack of revenue. The closure, unfortunately, left tens of thousands of students holding the bag for an incomplete education and demanding justice. The issue has shined a light on what some are calling predatory practices of for-profit education companies.
The financial pitfalls of college costs have become impossible to ignore. Although it’s starting to become more of an issue during the 2016 presidential race, it’s hard to regard any of the candidates’ posturing as anything other than an effort to court young voters. In the meantime, millions of young Americans leave school with an enormous handicap before they can even begin to make their way in the world. The parents who co-signed for the loans are often on the hook for the debt well into retirement.
Student loan debt is the second-leading cause of bankruptcy. Student loan borrowers who filed for bankruptcy in 2013 had an average of $32,096 in education debt. While it may be incredibly difficult to discharge student loan debt without extraordinary intervention, like the Corinthians case, it’s not impossible. Even if you aren’t able to discharge the debt, bankruptcy can give you a little more breathing room so you’re able to restructure your finances and get your arms around your mandatory financial obligations. If you’re seeking relief from student loans or any other kind of debt, an experienced and qualified bankruptcy attorney may be able to help you get the fresh start you need.