Recently, the bankruptcy court in the Southern district of Florida, which includes Miami and Ft. Lauderdale, has started a new program which allows you to negotiate with all of your student loans.  It doesn’t matter if the student loans are private or Federal loans.  You will be able to send documents through a portal that the Court has access to.  All of your documents will be sent through the portal so that the lenders cannot say they did not receive the documents.  The program will access all of your loans and consolidate them.  Therefore, you will only have one payment to make to your new lender.  The repayment amount depends on your ability to repay the loan.  So the lender will be requesting your pay stubs, tax returns and bank statements.  These documents must be updated every year after an agreement has been reached.  There are some lenders, private lenders, who are not required to participate in this program, but the majority of student loan lenders do and are required to participate in this program.  

In order to enter the program, you must file a Chapter 13 bankruptcy in Miami or Ft. Lauderdale.  Because you would be filing a Chapter 13, there is a repayment plan that includes all of your debt.  Some of the debt can be treated outside the plan.  So if you have a mortgage and you are current with the mortgage payments, the mortgage does not have to be included in the repayment plan in Miami or Ft. Lauderdale.  In other districts, even if you are current with your mortgage payments, the courts require all debts to be included in the repayment plan.  Luckily, that is not the case in Miami or Ft. Lauderdale bankruptcy courts.  The repayment plan through bankruptcy lasts between three to five years.  The student loan program that has just been instituted can last up to 10-20 years.  All payments after the bankruptcy have been finished will be made directly to the lender.  We will still be required to send pay stubs, tax returns and bank statements and any other documentation the student loan lender requires.  We will still be representing you in supplying the documents through the portal every year.  The student lender will contact us, and we will contact you to tell you what documents you will need to comply with the student loan lenders request.  We will send those documents through the portal for them to receive the documents.

Based on your ability to repay the student loans, the new consolidated payments can be as low as $0.  It is all based on your ability to pay which is proven by the documents you will be submitting through the student loan portal. Once the 10-20 year period is up, the consolidated student loans may be forgiven completely.  If you have a lot of student loan debt, whether it was for you as a guarantor, for your child, this new student loan program through Chapter 13 bankruptcy may be a good option to repay the loans in full.