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  • Writer's pictureRebecca Natow

News on Bankruptcy Discharge for Student Loan Debt

Inside Higher Education has a very interesting report today on a recent case where a federal bankruptcy judge ruled that it is possible for a debtor to file for bankruptcy protection with regard to student loan debt, something that has been very difficult to do given the high "undue hardship" standard that has applied to student loan debt since Congress changed the bankruptcy law in 1998. As noted in the article, this decision is part of a trend in which courts have recently begun to lower the bar for what counts as an "undue hardship" when it comes to student loan debt.

From Inside Higher Education: "The issue has risen in prominence as the number of Americans with student debt has grown to an estimated 45 million, with many unable to repay their loans... some judges in the past five years have been taking a more expansive view of the hardship standard to allow bankruptcy, as they find more people coming to court who are unable to pay student loans."

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