Filing for bankruptcy not as easy as it used to be

Chapter 7, or absolute bankruptcy, which could be denied. It is not as easy as it once was to be granted bankruptcy. He might be eligible for Chapter 13, or reorganizational bankruptcy, which keeps the wolf from the door and allows him to make payments until all creditors receive their money. As I previously mentioned, no matter which bankruptcy he might choose, almost all cases will not cover his student loan debt.

There has been some rumbling in this election year to allow students to discharge their obligations. To me, that is a terrible lesson to teach: that people who have borrowed money to further their education for their own personal interest can then stiff the lender that provided the money. This is a topic for another day. Q: My son, who is a sophomore in college, has a good chunk of money in savings. In fact, he has enough money saved to pay for the college that he’s attending, yet he has insisted on taking out student loans.

He and I argue about this all the time. I don’t want him to have this debt. He says there’s nothing wrong with borrowing the money and investing it, and that since there is no interest, whatever he earns is just gravy.

I think he is doing something illegal. Am I wrong? — Concerned Mother, via email A: Your son is not first to do what you describe. Is there anything improper? That depends whether he answered all questions truthfully in loan documents he signed.

You say that whatever he earns is “gravy.” On the other hand, if he loses money on his investments, the gravy goes and he has to pay back this loan when the time comes from some other source.

The fact that your son has saved money says a good deal about him. If he is able to do this without any impropriety, and if he understands that investments don’t always rise in value, frankly, I have no problem with it. I actually admire his abilities and would probably encourage him.