Can I Still Go To College If My Parents Filed Bankruptcy?

If you or your parents have been through the process of bankruptcy, then you probably have a few questions about the future. Bankruptcy will, naturally, have some effects on credit history

Can I Still Go To College If My Parents Filed Bankruptcy?

But will this ruin your chances of going to your college of choice?

Many parents want to help their children succeed by helping them pay their way through college. But if they have bankruptcy on their record, will it hurt your chances of getting financial aid to help make college more affordable? These are very important questions and their answers can make huge impacts on your financial future, so wersquo;re here to try and break them down for you.

Bankruptcy Reform of 1994

This reform is like your saving grace. It states that a student cannot be denied government grants and loans due to a history with bankruptcy. That means that a student can receive student loans even if their parents have declared bankruptcy. For example, one student loan called the Stafford loan does not depend on your credit history.

The bankruptcy reform of 1994 also means that you can receive federal and state grants to fund your education. Students can also earn scholarships and receive money from the college just like other students with clear credit histories. Your parents might even be able to set up a payment plan with your college to make it easier for you.

Federal PLUS Loans

Maybe this all sounds a little too good to be true, but there is one catch that applies to those with a bankruptcy in their history. Parents will not be able to apply for Federal PLUS loans if they have gone through bankruptcy within the last five years. By law, those who apply for Federal PLUS loans must have a clear credit history.

There is still hope to fund your education though. If your parents are denied a Federal PLUS loan, that means that you will be eligible to receive larger unsubsidized loan limits. During the first two years of college you can receive up to $4,000 more in unsubsidized loans, and that limit will increase by $1,000 more during their last two years of college.


If your parents have their hearts set on receiving a Federal PLUS loan, there is still a way to receive one. Even if they have bankruptcy in their history, they can receive a PLUS loan if they have someone who is willing to cosign on the loan. If they have someone who is willing to cosign, they must have a clear credit history.

Private Schools

Private colleges are a little different, and a tad trickier to deal with if your parents have bad credit. The Bankruptcy Reform of 1994 and all it states applies to federal student loans, but it doesn’t apply to private student loans. If your parents apply for a private student loan, the lender will look at your credit history from the last 7 to 10 years to decide whether or not to grant the loan.

If you have any worries about paying for your education, you should be sure to speak with the collegersquo;s financial aid department. They may be able to set up payment plans, extensions on payments due to special circumstances, and much more. Just because your parents have had a rough time, it doesn’t mean their children (you!) will have to suffer. So take a deep breath and know that college is definitely still and option for your future.

Colin Andrews works for Ziegler Law Office, a Clearwater bankruptcy attorney. The law firm has helped several parents and college students find educational success.nbsp; As a Clearwater bankruptcy attorney, Colin hasnrsquo;t dealt with bankruptcy outside the state of Florida but is confident students all over the country can fund the educational career of their choice.

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Author: SmartStudent

SmartStudent is an educational portal that provides information & advice to aspiring students. regarding applying to university, choosing a course, what to take to university, finding student accommodation and much more.

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