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Getting student loans after bankruptcy

In some cases, Kentucky residents may want to go back to college after they have obtained a discharge of debt through bankruptcy. Some of them may be concerned that their bankruptcy will prevent them from being able to secure student loans to help them pay their college tuition, and they may refrain from enrolling as a result.

People who have a bankruptcy on their credit record are often able to obtain student loans through the federal government. Federally-backed student loan lenders are prohibited from discriminating against loan applicants on the basis of bankruptcy, meaning most people who apply for them and who qualify will be successful with their applications.

Private student loan lenders in most cases operate under different credit standards, and they may deny loans to people whose credit scores are poor. Since these loans are not federally insured, the private lenders may apply the credit criteria they would normally use in loan approvals. Some people may still be able to obtain loans anyway, as many people who have filed bankruptcy are able to receive credit soon after receiving their discharge. They should be aware that these loans may be at higher interest rates than those available for federal student loans, however.

A Chapter 7 bankruptcy filing is not a bar to people receiving student loans after they have received their discharge. People who have a bankruptcy on their record and who wish to return to school may want to speak with the financial aid office at their intended school. In most cases, people should be able to apply for and receive student loans to help them pay for their educational expenses. Those who are facing unmanageable debt do not need to put off filing for bankruptcy because they are concerned they will not be able to get this type of credit afterward. A bankruptcy attorney may be able to provide guidance to a client who is in this situation.

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Law Office of Ginger C. Cord, PSC
155 E. Main Street
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Lexington, KY 40507

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