Banking Law

College Students and Credit Card Debts

By Susanne Robicsek, North Carolina Bankruptcy Attorn

College students face huge financial burdens getting their education, then paying it off.  It is bad enough to take out student loans for tuition, but today’s students are being lent money to cover living expenses under the umbrella of an educational loan.  These educational loans allow someone to live without income.  This means that many students are borrowing enough to replace an average worker’s salary for the years in college, and cover tuition and books.  If someone is out of work, they would not borrow a year’s salary and continue to live as though they were working.  They would cut back on expenses, perhaps sell their car, move in with relatives, and make other efforts to use as little money as possible.   Students come out owing tens of thousands of dollars for their education, AND car payments, pizza, beer, utilities, apartment rent, and so on.

Unfortunately, student loans have no shelf life — they will follow borrowers FOREVER.  They survive bankruptcy and just get bigger with penalties and interest.   The lender won’t care if the student doesn’t find a job, or the job they find isn’t enough to cover the payments and bare living expenses.  Before you borrow, think about whether or not there is something you can do to cut back on spending so you can borrow even a little less.   You don’t want to still be paying for a car you owned years ago, plus interest.

See also:

Bankruptcy Law Network Jun 29, 2008 Can I Support My College Age Children and Still File Chapter 7? by Jonathan Ginsberg, Atlanta Bankruptcy Attorney

Bankruptcy Law Network Dec 28, 2007 Children?s College Education At Risk If Parents Are Bankrupt by Susanne Robicsek Charlotte NC Bankruptcy Attorney

Full post as published by Debt Law Network on June 01, 2009 (boomark / email).