Families across the country are facing financial disasters that lead down the only path of choice, bankruptcy. It is a sad story repeated often. The Associated Press reports a tale of school teachers losing everything they worked long and hard to obtain.
That road toward Chapter 7 bankruptcy actually began during college days. A young, energetic woman attending school on a full athletic scholarship had to choose between playing collegiate softball and pursuing course studies that would not permit her to fulfill her team commitments. She chose school, lost the scholarship and took out student loans.
Her husband took out loans to pay for a master’s degree program believing additional education led the way to personal and financial success. It was possibly a good plan; yet, timing sometimes is a cruel and malevolent foe. A house was purchased at that very wrong time. Unforeseen medical bills struck. A pregnancy went wrong resulting in stillborn twins. The family faced not only personal trauma but were now devastated by school layoffs. They ultimately lost the house and a car.
So, filing for bankruptcy could give the couple a second chance, right? Unfortunately, the greater bulk of the couple’s debt stemmed from outstanding private student loans not covered under current Chapter 7 bankruptcy laws. The story is sadly quite common since 37 million Americans owe $870 billion in student loan debt.
Look to a future post where student loans are discussed where action to combat its burden is revealed.
Source: The Associated Press, “Even after bankruptcy, trapped by student debt,” Justin Pope, April 25, 2012