Private student loan debt is very difficult to include in a Chapter 7 bankruptcy, which is a forgiveness of all unsecured debt. To include a private student loan in a Chapter 7 one must prove to a judge that repayment of the debt would present an undue hardship on them and their dependents. Consider the resource below for examples of undue hardships. They are fairly extreme circumstances.
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As a result, debt settlement may be the best and only option for consumers in default, or about to default, on private student loans. Debt settlement done by a qualified debt settlement attorney can result in a reduction of the principal balance owed on a private student loan. Contact a qualified debt settlement attorney and learn more about your options to handle private student loans.