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Banks hardly lose money on loans, they have an infinite capacity to go after delinquents. Try to default on your loan and see what happens to you. You'll be a slave of the bank for the rest of your life.

Of course, individuals bear no such power. So please don't use banks as an example.

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> Try to default on your loan and see what happens to you. You'll be a slave of the bank for the rest of your life.

Bankruptcy exists almost entirely to offer protection against this exact scenario playing out.

As long as the debt in question is not a student loan, which usually survive the bankruptcy.

"Usually" is quite correct. You basically have to prove there would be no hope of being able to pay it back without severe financial hardship, and the bar for hardship is fairly high. Even when some student debt is discharged in bankruptcy, it's often a partial discharge.

On the contrary, banks have departments dedicated to estimating the amount they will lose from bad loans. It's expected.

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