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I am 39 years old (for one more month) I have close to 130,000

in student loan debt, some...
I am 39 years old (for one more month) I have close to 130,000 in student loan debt, some private loans, but mostly federal loans, , mostly because of interest. I have been paying for my private loans for more than 12 years. In fact, the original amount for one of my private loans was 10,000 in 1999 and I still owe close to $6000 on this loan. In addition almost $25,000 in interest has been added to my federal loans. I have never missed a student loan payment. I have no credit card debt, but do have a car loan.

I work 7 days a week! I have a full-time job as Public Health Nutritionist and a part-time job and have been doing this routine for more than 3 three years now (the 7 days). I'm not sure physically how much longer I can sustain working the way I do. I'm having some medical issues because of no rest or down time.
BotXXXXX XXXXXne is I have been doing this in hopes of getting ahead financially, but it's not really working out that way. I have no hope of owning a home, starting a family or even saving money to retire. I currently have less than $5,000 saved. How long will that last if I become injured or unemployed?

Moreover, my full-time job is a "permanent" consulting position that offers no benefits, so I am currently without health care coverage. (Cobra payments were completely unaffordable).

So, I have been doing some research on bankruptcy and student loans. I understand that bankruptcy cannot be declared for student loans, but from what I have been reading it may be possible if it can be proven that paying back these loans with be a burden affecting the rest of my life, plainly put. Maybe some of them can be declared in bankruptcy. I have also read that some lawyers have had some success with this.

Who can I speak with, receive information from ect.
Please Help!
Susan
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Answered in 34 minutes by:
8/1/2012
socrateaser
socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 39,348
Experience: Attorney and Real Estate Broker -- Retired (mostly)
Verified
If you have been researching this issue, then you are probably aware of the "Brunner test" for determining "undue hardship" related to the discharge of a student debt under Bankr. Code 523(a)(8).

In Brunner v. New York State Higher Education Services Corp., 831 F.2d 395 (2d Cir. 1987), the Second Federal Circuit Court of Appeals ruled that to discharge a student loan, the debtor must prove the following:
  1. That the debtor cannot maintain, based on current income and expenses, a “minimal” standard of living for herself and her dependents if forced to repay the loans;
  2. That additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and
  3. That the debtor has made good faith efforts to repay the loans.

 

Your facts show that you are at least close to meeting all three of the tests. If your balances are increasing, rather than decreasing due to the interest being added faster than your principal is being paid down, then that along with the inability to save any money, plus the fact that you are working a schedule that is effectively impossible to maintain without becoming seriously ill, suggests that you are in the ballpark to discharge the debt.

There is no bright-line determination here. You need a bankruptcy lawyer with experience in student loan discharges -- someone who has actually succeeded in obtaining a discharge -- and there are damn few lawyers who can make that claim. But, unless you have someone who has had success, then I wouldn't pay the lawyer a dime to handle that portion of the bankruptcy case, because there's a high probability that he or she will lose and you will have burned through perhaps an extra $5,000 or more to try to jettison the student loan debt.

In my view there is no point in trying to discharge anything other than all of the debts. Either you're free or you're a slave -- there is no middle ground.

That's about all I can offer to you here. For a competent bankruptcy lawyer referral, see this link (but, do not just accept the referral without the sort of confidence that I've described -- you need someone who has actually succeeded in discharging a student loan).

Hope this helps.

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socrateaser
socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 39,348
Experience: Attorney and Real Estate Broker -- Retired (mostly)
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