We were interviewed by Wallace Chapman, from Radio New Zealand, about student loan debtors going bankrupt. The link to the interview is here. We act for many student loan bankrupts. But that's not the only solution in all cases. We also have many clients who repay large student loans, often after we have obtained a write off, payment arrangement, or hardship approval.
Our typical client is someone who left New Zealand 5-15 years ago. At that stage their student loan debt was $20,000. They were very young when they took out the debt and didn't understand the details, or they were misinformed and told that they didn't have to repay the debt unless their earnings were above a threshold. They gave the IRD their contact details but the first they heard from them was years later when they were contacted and told that, not only is their student loan debt now $120,000 (through interest and penalties), but that they have to pay $40,000 within 7 days. Their lives are destroyed. Many people say that the IRD refuses to give them options for dealing with their debt, gives them misinformation, or treats them rudely. When they contact us we advise them of all of the available options for dealing with the debt, and the advantages and disadvantages for them of each option. With some clients we can arrange a resolution with the IRD that may include a partial write off, a time payment arrangement or hardship. Sadly, many people do not have the funds to pay the IRD, or they find that even if they can manage the annual compulsory payments the debt will grow faster than they can pay it off. For many reasons, some people may find that bankruptcy is their only option. Not only does bankruptcy bring an end to the debt, it also stops harassment. In the right circumstances, bankruptcy can provide enormous relief from stress and provide a path forward for the rest of your life.
Our typical client is someone who left New Zealand 5-15 years ago. At that stage their student loan debt was $20,000. They were very young when they took out the debt and didn't understand the details, or they were misinformed and told that they didn't have to repay the debt unless their earnings were above a threshold. They gave the IRD their contact details but the first they heard from them was years later when they were contacted and told that, not only is their student loan debt now $120,000 (through interest and penalties), but that they have to pay $40,000 within 7 days. Their lives are destroyed. Many people say that the IRD refuses to give them options for dealing with their debt, gives them misinformation, or treats them rudely. When they contact us we advise them of all of the available options for dealing with the debt, and the advantages and disadvantages for them of each option. With some clients we can arrange a resolution with the IRD that may include a partial write off, a time payment arrangement or hardship. Sadly, many people do not have the funds to pay the IRD, or they find that even if they can manage the annual compulsory payments the debt will grow faster than they can pay it off. For many reasons, some people may find that bankruptcy is their only option. Not only does bankruptcy bring an end to the debt, it also stops harassment. In the right circumstances, bankruptcy can provide enormous relief from stress and provide a path forward for the rest of your life.