This question has been asked by a new evil graduate who doesn’t want to pay and I can’t seem to find the answer on google for him.

So if a newly graduate happen to have the best rating and a big card that may be willing and able to pay off his student loans, by writing a card check. Can he just file a bankruptcy later so that he does not have to pay his card bills?

Note: If someone is thinking that the employer may check his …Of course he may get a first then he may file bankruptcy. So before 7 years, no debt and no bad record.

 

  • Jdub 5:01 pm on April 1, 2010 Permalink |

    Technically, yes. But here’s the deal:

    1) You can’t write credit card interest off on your taxes. You can write off every single cent of federal student loan interest on your taxes.

    2) You won’t be eligible for any of the loan forgiveness programs available to you with federal student loans once you transfer the debt to a credit card. You can find out more about forgiveness programs at http://www.fsa.ed.gov.

    3) Federal student loan debt hits your credit report differently than consumer debt (ie credit card debt). Consumer debt is considered very differently when evaluating your eligibility for home mortgages, car loans, etc. If your federal loan is in grace, it is totally ignored when you are considered for a home mortgage…like it’s not even there. Not true with consumer debt.

    4) You can’t get out from under credit card debt through bankruptcy anymore either. You will still be responsible for all of the debt. Bankruptcy will sit on your credit report like a brick for years and years.

    So tell your evil graduate that this is a bad idea and will not accomplish what he/she thinks it will. They will still be responsible for the debt. And they will be far worse off than they think they are now.

  • QF 5:01 pm on April 1, 2010 Permalink |

    no

  • Topnotch Engineer 5:01 pm on April 1, 2010 Permalink |

    In theory, that is a very good idea. In real world, I think it’s a little bit more complicated than that. I think the government would be smarter than to bail you out by bankruptcy and also pay for your tuition.

    I think that there are many other people that think the same way you do, and it’s not gonna fly.