One advantage of a Chapter 13 bankruptcy is that you, not your loan holder will determine the size of your student loan payments.  You will make court-determined payments while you are in the Chapter 13 plan, usually for three to five years. You may still owe the remainder of your student loans when you come out of bankruptcy, but you can try at that  point to discharge the remainder based on undue hardship. While you are repaying through the bankruptcy court, there are no collection actions that can be taken against you. The advantage of a Chapter 13 is that your student loans may be either given priority or otherwise paid at the expense of your unsecured creditors. 

You may have other options, depending on how judges decide these cases in your judicial district.  For example, some judges allow student loan borrowers to give priority to their student loans during the Chapter 13 plan.  Some bankruptcy lawyers don't know that it is even possible to discharge student loans.  Some districts still require that you first apply for the Income based repayment plan.  Here is the government information on the income based repayment plan.

The Bankruptcy Manual discusses student loans and hardship discharge.  Download your free copy.   The Bankruptcy manual is for informational purposes only. The Bankruptcy Manual comes in rtf format for word or WordPerfect, pdf for adobe, or you can download the audio.

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Indiana Student Loan Hardship Discharge  Bankruptcy Student Loan Hardship Discharge

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