Student Debt Solutions

Smith Law Group Blog

Sharing thoughts on the latest news about student loan debt relief and bankruptcy.

Student Loan Debt and the Gender Gap

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Perhaps one facet that is missing from the debates on student loan debts and the many proposed solutions, is the adverse impact of these debts upon women. According to The Cut, in an article from 2017, women hold nearly two-thirds of the outstanding $1.5 Trillion student loan debt nationwide. That means that nationwide women hold nearly $1 Trillion worth of student loan debt.

Realizing that women now outnumber men on college campuses, this should not necessarily come as a surprise. However, when thinking through dropping fertility rates nationwide and the economic impact of families laden with excessive student loan debt, perhaps this is the time for a movement within the student loan debt crisis that addresses adverse gender gaps and familial responsibilities post-graduation, in debt lending practices.

While pundits everywhere debate the merits of Elizabeth Warren and other presidential hopefuls’ proposals for student loan forgiveness, everyone seems to be overlooking the fact that some student loans have already been forgiven. Private student loans in certain circumstances can be treated as consumer debt in the bankruptcy courts, yet the myth that all student loans are unforgiveable still swirls around the media and often scares off debtors from considering this option.

Reportedly $9 billion of student loan debt has already gone through bankruptcy. This fact impacts student loan debt and the gender gap drastically.

To clarify, students can take out loans in three basic ways:

1. Federal Guaranteed Student Loans.

These loans are originated and guaranteed by the federal government. The rates are typically fixed and they do not accrue interest while the student is in school. These loans are non-dischargeable in bankruptcy absent proving it is an undue hardship to repay.

2. Private Qualified Student Loans.

Loans are not guaranteed by the federal government and oftentimes originated by a loan servicer that is servicing both the private loan and the federally guaranteed loans at a particular school. Interest accrues while the student is in school and payments are often required while the student goes to school. These loans are non-dischargeable in bankruptcy absent proving undue hardship to repay.

3. Private Non-Qualified Student Loans.

These loans are made for either ineligible expenses or to ineligible individuals. These loans can be discharged in bankruptcy. Private non-qualified student loans have often already been discharged in bankruptcy, yet often times the debtors do not realize this and the collectors are happy to collect on those loans to their advantage. Private qualified student loans are more difficult to get discharged, but not impossible.

Feeling crushed by student loan debt? Smith Law Group specializes in discharging both private qualified student loans as well as private non-qualified student loans. Should you want to explore these options in discharging your student loan debt, please feel free to explore more information on our website.