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Ask WALLSTREETESQ Your Own Question
Category: Bankruptcy Law
Satisfied Customers: 17223
Experience:  14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
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I need to claim personal bankruptcy due to fact I cannot pay

Resolved Question:

I need to claim personal bankruptcy due to fact I cannot pay my debts on LTD however I also must return to school to try to find a carreer that will allow me to work around my disability! I have 3 children that I alone support however from what I understand I will not qualify for student loan funding if I claim bankruptcy so my question is what can I do both are necessary...
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  WALLSTREETESQ replied 6 years ago.

Hello I am a licensed attorney here to help you with your question, please review my response and do not hesitate to ask for clarification.


You are correct in stating that a student loan would be difficult to obtain if you have filed a bankruptcy, if possible the best way to handle your situation would be to apply now for the loan, and then file a bankruptcy, student loans are not dischargable, so you would pay the loans and all your other debts would be discharged.

Customer: replied 6 years ago.
Ok so if I were to do this then I'm ok for lets say first year of studies but what about the second when I have already claimed bankruptcy...would I be declined ? Its really important that i do this right as 3 kids are dependent on me alone to support them i may try to get into law school as i currently have bachelor major
ing in psychology.
Expert:  WALLSTREETESQ replied 6 years ago.
Their is no restriction that a person who has previously filed bankruptcy cannot obtain a student loan, it may be difficult to get a private loan, however federal loans should approve you since credit scores are not an issue.
Customer: replied 6 years ago.
I was Looking at student loan site and was certain it stated that those whom had claimed bankruptcy were unable to qualify for student loan although I want your reply to be correct could u please just double check for me? I greatly appreciate your help. Thanks Alanna
Expert:  WALLSTREETESQ replied 6 years ago.
Private student loans will be an issue, but not for federal loans.
Student Aid EligibilityThis is from the Federal website:

Eligibility for federal student aid is based on financial need and on several other factors. The financial aid administrator at the college or career school you plan to attend will determine your eligibility.

To receive aid from our programs, you must


  • demonstrate financial need (except for certain loans).
  • have a high school diploma or a General Education Development (GED) certificate, pass an ability-to-benefit (ATB) test approved by the U.S. Department of Education, meet other standards your state establishes that the Department approves, complete a high school education in a home school setting that is treated as such under state law, or have satisfactorily completed six credit hours or the equivalent course work toward a degree or certificate.
  • be enrolled or accepted for enrollment as a regular student working toward a degree or certificate in an eligible program. Note: You might be able to receive aid for distance education courses as long as they are part of a recognized certificate or degree program.
  • be a U.S. citizen or eligible noncitizen.
  • have a valid Social Security Number.
  • register with the Selective Service if required. You can use the paper or electronic FAFSASM to register, you can register at, or you can call 1-847-688-6888. (TTY users can call 1-847-688-2567.)
  • maintain satisfactory academic progress once in school.
  • certify that you are not in default on a federal student loan and do not owe money on a federal student grant.
  • certify that you will use federal student aid only for educational purposes.

Students with intellectual disabilities can receive federal student aid under the Federal Pell Grant Program, FSEOG Program and Federal Work-Study Program. To be eligible, you must


  • be enrolled or accepted for enrollment in a comprehensive transition and postsecondary program for students with intellectual disabilities at an institution of higher education;
  • be maintaining satisfactory progress; and
  • meet the other student eligibility criteria.

The Higher Education Act of 1965 as amended (HEA) suspends aid eligibility for students who have been convicted under federal or state law of the sale or possession of drugs, if the offense occurred during a period of enrollment for which the student was receiving federal student aid (grants, loans, and/or work-study). If you have a conviction(s) for these offenses, call the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243) or go to the FAFSA on the WebSM site, click on "Before Beginning A FAFSA" in the left column, then click on "Student Aid Eligibility Worksheet" to find out how this law applies to you.

If you have lost federal student aid eligibility due to a drug conviction, you can regain eligibility if you pass two unannounced drug tests conducted by a drug rehabilitation program that complies with criteria established by the U.S. Department of Education.

Civil Commitment for Sexual Offenses - A student subject to an involuntary civil commitment after completing a period of incarceration for a forcible or nonforcible sexual offense is ineligible to receive a Federal Pell grant.

Even if you are ineligible for federal aid, you should complete the FAFSA because you may be eligible for nonfederal aid from states and private institutions. If you regain eligibility during the award year, notify your financial aid administrator immediately. If you are convicted of a drug-related offense after you submit the FAFSA, you might lose eligibility for federal student aid, and you might be liable for returning any financial aid you received during a period of ineligibility.

If you have a question about your citizenship status, contact the financial aid office at the college or career school you plan to attend.

How will I know what I'm eligible for?

The information you reported on your FAFSA is used to determine your Expected Family Contribution (EFC), which is calculated by a formula established by law. The EFC is not the amount of money that your family must provide. Rather, you should think of the EFC as an index that colleges use to determine how much financial aid (grants, loans or work-study) you would receive if you were to attend their school. If your EFC is below a certain number, you’ll be eligible for a Federal Pell Grant assuming you meet all other eligibility requirements.

You can get worksheets that show how the EFC is calculated by downloading them from our Web site at Click on the award year appropriate to you under "EFC Formula."

The amount of your Pell Grant depends on your EFC, your cost of attendance (which the financial aid administrator at your college or career school will figure out), and your enrollment status (full time, three-quarter time, half time, or less than half time).

For our other aid programs, the financial aid administrator at your college or career school takes your cost of attendance and then subtracts your EFC, the amount of a Federal Pell Grant you are eligible for, and aid you will get from other sources. The result is your remaining financial need:

Cost of Attendance
- Federal Pell Grant Eligibility
- Aid From Other Sources
= Remaining Financial Need

If you're attending at least half time, your cost of attendance is the sum of


  • your actual tuition and fees (or the school's average tuition and fees)
  • the cost of room and board (or living expenses for students who do not contract with the school for room and board)
  • the cost of books, supplies, transportation, loan fees, and miscellaneous expenses (including a reasonable amount for the documented cost of a personal computer)
  • an allowance for dependent care
  • costs related to a disability
  • reasonable costs for eligible study-abroad programs.

Costs unrelated to the completion of a student's course of study are not included in calculating that student's cost of attendance.

A financial aid administrator can consider special or unusual circumstances such as unusual medical expenses, tuition expenses, or unemployment and can adjust your cost of attendance or some of the information used to calculate your EFC. The financial aid administrator at your college or career school also can change your status from dependent to independent but only under specific circumstances the aid administrator will explain. You'll have to provide your college or career school with documentation to justify any change. The decision to change or not to change your dependency status is based on the aid administrator's judgment, and it's final. It can't be appealed to the U.S. Department of Education.

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Customer: replied 6 years ago.
Ok but I'm in Canada so things may be different right? I guess I assumed you were too...that should be addressed before question is sent to you. Should I re ask this question and state I'm in Canada ? Or can u get the answer? I will accept however because u have put alot of effort in answering
Customer: replied 6 years ago.
Hello again I see that I did put in country relating to question Canada! So maybe you did not see this anyway were u able to find out about Bankruptcy and acquiring student loans in Canada?
Expert:  WALLSTREETESQ replied 6 years ago.
the Canada Student Loans Program (CSLP) is implementing changes that will allow borrowers who participate in a bankruptcy-related event to apply for new federal loans while in-study and for debt management measures while in repayment. A bankruptcy-related event includes acts of bankruptcy, filing a consumer proposal and/or participating in a provincial scheme for the orderly payment of debts.

This means that they will apply only to borrowers who participate in a bankruptcy-related event on or after the date of implementation. The regulatory amendments will be published in the Canada Gazette, Part 1, Volume 138, #11 on June 2, 2004.

The changes for borrowers who participate in a bankruptcy-related event include:

Eligibility for interest free status on full-time students' loans while the borrower is in-study;

Availability of new student loans for a maximum of three years, provided that the borrower remains in the same program of study and does not drop below full-time status; and

Access to debt management measures, including Interest Relief and Debt Reduction in Repayment
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