Many clients are concerned about how bankruptcy will affect their children, especially with regard to obtaining financing for post-secondary education.

Unlike most credit, federally guaranteed student loans are not conditioned upon credit history. Federal student loans are available if you meet the statutory and administrative criteria. Although default on an existing educational loan may affect your ability to get a subsequent loan, the filing of a bankruptcy in itself should not (student loans are not dischargeable except under extraordinary circumstances). Under 11 U.S.C. ยง 525(c), federally guaranteed loans, federal grants, and federal loan insurance may not be denied on the basis of a bankruptcy filing. This applies to both the debtor and to persons with whom the debtor is associated (so your bankruptcy cannot be held against your children). For more information on educational loans, you can start with Student Aid on the Web, or the financial aid office at your schools of interest.