[Parthamis]

So basically, I am in 150k of private student loan debt that I’m defaulting in. And 90k of federal loans in which I am on a Pay as you Earn program, allowing any amount after 20 years to be forgiven.

Will my defaulted student loans stop my CPA application? 110k or so is ‘charged off’ and about 40k is in collections.

[AusNat]

It will be a state by state thing, but my state's rules don't say anything about credit or debt issues that aren't the subject of litigation in their background statement & check thing. Make sure you've appropriately reported all of the discharged debt on your tax returns though; in many cases, debt relief is income. Unfiled tax returns or an unpaid tax liability can definitely pose licensure issues.

That said… credit issues and debt in default can be a problem in the job search, especially in positions with financial responsibility or where you have access to sensitive data or assets. It's becoming more and more common for employers to include credit checks with their pre-employment background checks.

[Author]

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