Congress Considering Changes to Allow Student Loan Debt to be more easily Discharged in Bankruptcy
Currently, student loan debt can not be discharged in bankruptcy without showing that the payback of the student loan would be an “undue hardship” on the debtor. The courts have interpreted this very strictly to mean that a person almost has to be homeless or living out of your car to qualify under the courts standard. (not quite that bad, but close !)
Here is the link to the Committee’s website: http://judiciary.house.gov/hearings/hear_090923_1.html
Because of the economic collapse the country is suffering, and the extremely large student loan debt that folks are facing, Congress has been requested to re-visit this part of the bankruptcy law. The Committee on the Judiciary’s Subcommittee on Commercial and Administrative Law is holding this hearing at the direction of the Chairman.