Behind on Student Loans :: What can Happen and What are Your Rights?

Are you behind on your student loans? There are a few things you need to know that could happen in this instance.

Of the major consequences, the IRS can actually step in and use any monies you may have received in a tax return toward the payment of your student loan. They are lawfully able to do this until your loans are paid off in full.

That said, you are free to argue the IRS in their effort to remove partial portions of your tax return, but you must have good reason to earn this right. A helpful resource for obtaining information on your rights is www.studentloanborrowassistance.org (the official website of the National Consumer Law Center.)

Another possibility when you fall behind on your student loans is that earnings from your paychecks can be garnished. A debtor of a student loan may lawfully garnish up to 15 percent of the wages you earn.

But again, you may fight a garnishment from a debtor. In most cases, the best option for those behind on their student loans is to discuss the issue with the debtor and work out some kind of deal to either obtain an extension or at the very least get the debtor to lower the amount that they are garnishing from your wages.

For help with dealing with student loans in the midst of a personal bankruptcy, contact the offices of Tom McAvity by dialing 503.860.6868 today.

Portland Bankruptcy | Does Bankruptcy Clear Student Loans?

According to a recent New York Times article written by Ron Lieber, the current state of bankruptcy law makes it extremely difficult if not impossible for most people to wipe out student loans with bankruptcy filing. Tom McAvity has been following the trends, and it appears as though a number of congresspersons are determined to help people get rid of student loan debt with bankruptcy, especially in cases where loans were disbursed from lenders such as Sallie Mae.

While we wait for more fair rulings where student loans and bankruptcy are concerned, many people struggle, knowing that they can't pay their mortgage, car payment, and other lines of credit in addition to their student loans. For these people, Tom McAvity can assess their unique situation and determine if bankruptcy filing in Portland will help to lessen the financial burden -- even if student loans are not wiped out by bankruptcy.

In his New York Time article Ron Lieber argues that it's insanity that a person can wipe out the debt they owe on an expensive luxury car while someone who simply wanted to educate himself is unable to clear a debt for having done so.

If you are struggling with debt associated with student loans in addition to a an ARM mortgage and/or other heavy debt, Tom McAvity can tell you there is hope through debt relief. Bankruptcy may be a good fit for you. To find out, call 1-866-601-1918 for a FREE bankruptcy consultation.