Lexria Review: Student Loan Bankruptcy Help

The bottom line: Lexria can connect you with an attorney who has previously helped student loan borrowers dismiss their debt via bankruptcy. It is best for borrowers with private student loans who’ve already completed a bankruptcy filing — ideally, within the past five years — but did not include that debt.


Product	Student loan bankruptcy help
Fees	$299 upon signing with an attorney. $299 monthly payments during litigation.
Total costs	12% of any amount eliminated by bankruptcy; if no debt is discharged, you pay nothing and fees are refunded.
Location	Currently available only in certain states. Contact Reset Button for details.

Pros & Cons

Pros

Money you pay is returned if your student debt is not reduced or discharged.
Monthly payment plans for legal fees are available.

Cons

Lawyers may not be available in your area.
Monthly payments of $299 are due during litigation.

Full Review

Lexria launched its services in February 2020, originally under the name Reset Button. Lexria is not a law firm, nor does it offer legal advice. Rather, it is a technology company that connects student loan borrowers with experienced bankruptcy attorneys.

While it’s possible to dismiss student loans via bankruptcy, few borrowers take this step. One of Lexria’s co-founders, Jason Iuliano, an assistant professor of law at Villanova University, found that just 0.1% of borrowers attempted to discharge student loans when filing for bankruptcy.

That low number is partly because obtaining relief presents multiple hurdles, including:

Finding a bankruptcy attorney who understands the student loan landscape.
Paying additional bankruptcy costs, for a lawsuit known as an adversary hearing.
Overcoming the lack of a set standard for dismissing loans via bankruptcy.

Lexria aims to address these challenges: It connects you with bankruptcy attorneys who’ve had success obtaining student loan relief, and it has a “Fresh Start Guarantee” that refunds your money if no debt is discharged.

Lexria can’t do anything about murky bankruptcy standards — nor the fact that student loan companies aggressively fight these lawsuits. Its Fresh Start Guarantee refunds anything you pay out of pocket if your filing is unsuccessful, but you’ll still need to pay the $299 each month during litigation.

Ultimately, talking to a lawyer in Lexria’s network costs only your time; you don’t pay anything until you sign with an attorney. But even if you both think your student loans should be dismissed via bankruptcy, you still might not end up with the relief you want or need.

Lexria details

Costs

Lexria makes its money by charging attorneys fees for nonlegal administrative services related to their cases. You do not pay Lexria; you pay the attorney you work with after signing with him or her.

Fees: $299 initial payment, then $299 each additional month during litigation.
Total costs: You’ll owe 12% of any discharge amount; your previously paid fees are credited toward this amount. If you receive no relief, you pay nothing and fees are refunded.
Payment plans: If you can’t afford the total charges post-litigation, interest-free plans of $299 a month are available.

For example, say your case lasts nine months and results in the dismissal of $80,000 in student debt. You would owe $9,600 (12% of $80,000) minus the nine $299 payments already made.

That could end up similar to how much a non-Lexria bankruptcy attorney may charge — the site uses $10,000 as a benchmark — but you'd potentially have to pay it all upfront and get no guarantee of relief.

Keep in mind that Lexria's charges are on top of the original costs from when you filed for bankruptcy, which can range from hundreds to thousands of dollars.

Eligibility

Lexria currently focuses on borrowers who previously filed for bankruptcy without including their private student loans, but may be able to help post-bankruptcy borrowers with federal loans as well.

Ideally, you’ll have filed within the preceding five years and be in a similar place financially, which could reinforce that you may never be able to repay the debt. There is no strict time limit, though.

In addition to bankruptcy history, you may be a good candidate for Lexria if you have:

Significant student debt.
A debt-to-income ratio that exceeds 150%.
Long-term struggles repaying student loans.

Attorney network

Lexria does not disclose the number of attorneys within its network.

Iuliano says attorneys are available in about a dozen states, but that number is expanding. Lexria will connect you with an individual attorney in your area, if available.

Attorneys do not pay Lexria to be listed in its network, nor to be provided with leads. Lexria rigorously vets every lawyer; Iuliano says the service has turned down 70% to 80% of interested attorneys. Those accepted all have a history of obtaining student loan relief.

Before deciding to sign with any bankruptcy attorney, be sure to ask your own questions about their experience — and success — discharging student loans.

Additional services

Bankruptcy is not an option for every student loan borrower. Lexria also provides resources around income-driven repayment plans, debt consolidation and student loan refinancing.

Options besides bankruptcy

Lexria is not a law firm and cannot advise you whether to file for bankruptcy in the first place. Bankruptcy may make sense if:

Your consumer debt — like from credit cards or medical bills — is more than half your income.
It would take at least five years to pay off that debt.

If you need student loan help

If you’re struggling with student loan debt, first speak with your servicer or lender to:

Discuss repayment options.
Take a temporary payment pause.
Temporarily reduce your monthly payments.

If the problem is with your lender or servicer or you’re not getting the help you need, look for a legitimate student loan help organization that offers counseling. In addition to Lexria, consider these other vetted resources for student loan help; they're established organizations or legal representatives with verified histories:

Student loan help resource	Best for
The Institute of Student Loan Advisors	Advice on repayment plans, forgiveness programs and dispute resolution.
National Consumer Law Center	Comprehensive information on options for student loan borrowers.
Student Borrower Protection Center	Advocacy on behalf of all borrowers to influence policy.
National Foundation for Credit Counseling	Complete financial review for struggling borrowers, which can include advice on student loan options and plans for dealing with other debt.
American Consumer Credit Counseling	Advice on repayment plans, help with paperwork and budget counseling.
National Association of Consumer Advocates	Information for student loan borrowers and an attorney directory.
Lexria	Help for borrowers who have already filed bankruptcy that did not include their student loans.
Adam Minsky	Advice on defaults, dispute resolution, collections, debt settlement and legal remedies. Licensed in Massachusetts and New York.
Stanley Tate	Advice on debt settlement, bankruptcy, default and forgiveness. Licensed in Missouri and Illinois.

Many of these organizations offer advice for free. In some cases, you may need to pay a fee, as with a certified nonprofit credit counseling agency or if you hire an attorney.

None of the organizations above calls, texts or emails borrowers with offers of debt resolution.

Offers of help that you haven't sought out are likely to be scams. While it’s not illegal for companies to charge for services such as consolidation or enrollment in a payment plan, those are steps you can do yourself for free.

Avoid any debt relief companies that demand money upfront.

» MORE: How to spot student loan scams

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