You might remind your F/O that if he declares BK, especially for a flight training loan, it WILL come up on the credit check run by a prospective employer, and would probably down him even if everything else went well. It would reflect poorly on his judgement and ability to be responsible for his obligations.

If he can't make the payments on his flight pay, he needs to get another job on the side and work on his days off. THAT will show character and responsibilty.

If he BK's now, it will follow him for a very long time, and hinder his ability to advance his career in ANY field, not just aviation.

He better give it a lot of thought, and consult a professional (before he starts that process) and get the complete picture.