How does filing bankruptcy affect your FFEL student loans?

The purpose of filing a bankruptcy petition is to provide you with a fresh start. However, with very limited exceptions, all federally Guaranteed Educational Loans are nondischargeable under the Bankruptcy Code.

        • If you filed a bankruptcy petition after October 8, 1998, you must bring an action known as an Adversary Proceeding in the Bankruptcy Court, and prove to the court that repaying loan will create an undue hardship on you and your dependents.
        • During the proceeding, HESC will cease collection activities on your student loan debt, provided you or your attorney have provided timely written notice of the date of filing.

We strongly suggest that you consult with your attorney on the effect of filing a bankruptcy petition on your student loan debt.