A very common problem that comes up often with persons that owe student loans is the refusal of the school to provide a transcript of grades for use by the individual.  This could be a document needs for employment applications or maybe even going to another school.  Whatever the reason, the inability to obtain the transcript is a big problem.   If you do not have the money to pay the student loan and have other reasons to need bankruptcy relief you may find that filing a bankruptcy case allows you to get your transcript from the school even though you have not paid the student loan debt.

The reason behind this ability to obtain the transcript by filing bankruptcy is the result of the interplay between two different sections of the Bankruptcy Code.  Section 11 U.S.C. 362 ( a)(6), i.e. Automatic Stay, prevents any act to collect, assess, or recover a claim against the debtor that arose before the commencement of the case under this title.  If the school is refusing to provide the transcript because of the outstanding student loan debt, then there may be a violation of the Automatic Stay which could subject the school to penalties in the Bankruptcy Court for this violation.  Further, Section 11 U.S.C. 525  Protection against discriminatory treatment may also be asserted by the debtor in the event the school refuses to provide the transcript upon request.

So, in short, if the school is holding your transcript hostage until you pay your debt to the school or school loans, filing a bankruptcy case may be the ticket to allow you to get your transcript.  Of course, you have to qualify to file bankruptcy and need the protection of bankruptcy for other reasons beyond just your school loans to make this course of action worthwhile.  Our offices offer a free consultation if you would like for us to review your financial situation and see if bankruptcy might be a good option.