The thought of finishing college with a new degree can naturally be exciting. The idea of paying tens of thousands of borrowed dollars back to the government over the course of two or more decades -- not so thrilling. For some people in Pennsylvania, the process can seem downright dreadful if they can’t earn enough wages to cover their debt or can’t find work at all. People facing these scenarios may understandably be ready for automatic debt relief.
College debt increased a whopping 20 percent from 2011 to 2013. It now rests at more than a trillion dollars, and the fact that Stafford undergraduate loan interest rates recently increased from last year’s rate is causing concern among students. The higher government loan rates might motivate students to pursue more private loans, which can be risky. This is because private loans usually flexible repayment plans that are income-based.
The average amount of debt that students have once they graduate is nearly $30,000. Unfortunately, one in seven borrowers default on loans within three years of their graduation. This is particularly an issue for students who attend for-profit institutions.
Getting into debt can be de-motivating and have long-term impacts on one’s finances. However, personal bankruptcy can help to provide the immediate debt relief a person in Pennsylvania so desperately needs and desires. Although a bankruptcy filing usually won’t get rid of college debt, it can help to quickly take away other burdensome debt, thus allowing a college graduate to more practically pay down his or her student debt and become financially free sooner.
Source: CBS News, "Student loan interest rates rise, worrying some experts", Jonathan Berr, July 1, 2014