Discharging Student Loan Debt Could Soon Be A Possibility!
The Supreme Court (SCOUTS) has decided to hear the case of a former student who is trying to discharge his student loan debt through bankruptcy – United Student Aid Funds, Inc. v. Espinosa.
The key points to be decided here are: 1. whether loan debt can be discharged in bankruptcy without proving an undue burden for the debtor to repay the loan; 2. whether the burden is on the issuer of the loan to respond to the borrower when they dispute the legitimacy of the loan during bankruptcy proceedings; and 3. could a student loan be discharged during bankruptcy proceedings without the need for a hearing.
I will be following this case very closely and post continuous updates regarding its progression. Pending the final ruling, there is potential for a landmark holding which could have an untold impact in the student loan arena. The timeless notion that not even bankruptcy could save one from paying their student debt may soon be at an end!