The History of Student Loans in Bankruptcy
Student loans are basically non-dischargeable, almost everyone knows this. There are some very specific circumstances where even today you can have your student loan debt discharged, but that is a narrow exception that often requires a fight and money to fight. We will discuss the current state of dischargeability in a future post. The landscape around student loans and bankruptcy has not always been so desolate. Not so long ago these loans were dischargeable. Back when they were dischargeable, the cost of an education was much lower and the total student loan debt was a fraction of what it is now. With student loan debt currently being a 1,200,000,000,000.00 (One Trillion Two Hundred Billion) dollar problem holding people back from purchasing homes or taking part in the broader economy, with a little help they may become dischargeable yet again. A Brief History. Student loans really did not pop into existence in America until 1958 under the National Defense Education Act. 1. Thes...