Bankruptcy is sometimes the only option that a person has when they are drowning in debt that he or she is unable to pay.  Unfortunately, when a parent files bankruptcy it can have an impact on his or her child’s college financing.  Parents are not eligible to borrow money for college tuition from the PLUS loan program for at least five years and it could be seven years or more before they would qualify for a private loan.  For undergrads, parents that are denied loans through PLUS may get more from their Stafford loan.  However, students who file bankruptcy may have trouble if they to pursue graduate school and need loans.

For more read, “How Bankruptcy Affects College, Grad School Financing.”