Student Loan Forgiveness Tightening Up

Student loans hold a unique place among debt as non-dischargeable. Most debt, from a car loan to credit cards, can be discharged in a bankruptcy. Not so with student loans. The only way out of a student loan is to pay it off, or to get that debt forgiven by the federal government. With thousands of former students unable to pay off their loans, many are lobbying for more student loan forgiveness. These former students argue that they were lured into loans with false data about employment opportunities, and therefor should have their debt forgiven. Thousands of students have already had their debt forgiven by the feds.

Yet the Trump administration is now cracking down on student loan forgiveness. President Trump and Education secretary Betsy Devos believe that loan forgiveness under the Obama administration lacked sufficient standards, allowing thousands of perfectly reasonable student loans to be forgiven. Trump’s new standards would include criteria such as a status of default, which will hopefully keep people from abusing federal loan forgiveness.

While student loan debt is non-dischargeable, knocking out all your other loans can go a long way toward breaking the chains of debt. Thousands of people over the years have sought our help with financial problems, including hundreds from the Fairfield area. Feel free to give our Fairfield bankruptcy office a call to schedule your free consultation.