At present, student loans are nearly impossible to discharge under the bankruptcy code, even if you get yourself the best Las Vegas bankruptcy lawyer you can find.
The only way to meet the standard of “undue hardship” is to prove that you are physically unable to work, or your chances of obtaining any type of gainful employment in the future are non-existent. (That said, there are still ways of using the bankruptcy process to help you deal with student loans, as described in one of our previous posts.)
Fortunately for many American, all of that may soon change.
According to an article in Inside Higher Ed, Congress has been making noises about putting lenders of private student loans on the same footing as all other lenders. That means that in the near future, you may finally have the option of discharging your student loans in a bankruptcy filing.
Recently, the House Judiciary Subcommittee on Commercial and Administrative Law held a hearing on the subject of student loans. In it, Rep. Steve Cohen (D-Tenn.), the committee chair, said the current law gave private student loan lenders a “favorable, unusual” advantage over other consumer lenders. As a result, Cohen is initiating legilsation to undo a 2005 change in the federal bankruptcy law, saying, “Hopefully it’ll be bipartisan and if not, you know, we’ll just have to forge ahead and do what’s right.”
This is potentially great news for everyone facing financial hardship who also has to worry about student loans. According to House testimony by attorney Brett Weiss, a consumer bankruptcy lawyer, it’s unfair that mortgages and other large loans can be dealt with in bankruptcy while student loans cannot.
If you’re considering bankruptcy and student loans is one of your concerns, please get in touch with us for all the bankruptcy information in Las Vegas that you’ll need to start dealing with your problems. Get in touch with us for a free initial consultation and you can talk with an experienced bankruptcy attorney in Las Vegas and get a clear picture of all of your options.
For more information on student loans and bankruptcy, here’s one of our previous posts on the topic.