For many Maryland college students, the time leading up to graduation is one filled with excitement and hope for the future. Some are lining up jobs, while others are preparing for graduate study. For those who have taken out student loans to fund part or all of their education, concerns over their ability to repay these obligations can cast a pall over their plans for the future. For some, consumer bankruptcy may offer a form of financial relief, and the ability to repay their student loans.

Most students know that it is very unlikely that their student loans will be eligible for discharge under consumer bankruptcy rules. However, for those who have also racked up high levels of credit card or medical debt during their studies, bankruptcy can offer a number of benefits. In addition, many consumers do not need to consider bankruptcy relief until several years following graduation, when it becomes apparent that their salaries cannot meet their overall debt service needs.

In addition, there are a number of scams circulating that aim to defraud those seeking student loan debt relief. Anyone who is considering pursuing a consolidation loan or other options should make an effort to research the source of the debt relief, and ensure that they are dealing with a reputable debt servicing professional. In many cases, loan consolidations and other modification programs can be accessed directly through the federal government, and do not require a third party for participation.

Each and every individual’s financial standing is unique. Many in Maryland are able to work through a period of financial hardship after graduating from college, and move on to better overall stability. For some, however, their debt outlook is dire, and repayment seems unlikely in the foreseeable future. In such cases, consumer bankruptcy can help by eliminating many forms of unsecured debt, leaving the borrower free to make their student loan payments while also covering their living expenses.

Source: deseretnews.com, “9 ways to spot — and avoid — a shady student loan ‘debt relief’ agency”, Jan Miller, March 27, 2014