New Student Aid Bill of Rights: 2015

President Obama recently announced a new Student Aid Bill of Rights for all Americans. This new Bill of Rights could make it easier for people owing federal student loans to deal with their loans- specifically, how they may be more able to get rid of/discharge them in a bankruptcy.

Most of the announced changes are geared toward getting rid of payment red tape and making federal student loan repayment options easier. However, one section in particular shows that the government is looking closely at changes to bankruptcy laws that could help student loan debtors.

Debt guru Steve Rhode says that, contrary to popular belief, there have been people successfully discharging both private and federal student loans in bankruptcy. That said, his research found that less than four out of 10 who tried to discharge their student loan debt through bankruptcy were able to.

A Fox Business article written by Rhode quotes the new Student Aid Bill of Rights :

Section 3(b) says, “By July 1, 2015, the Secretary of Education shall issue information highlighting factors the courts have used in their determination of undue hardship, to assist parties who must determine whether to contest an undue hardship discharge in bankruptcy of a Federal student loan.”

Another section quoted in the same article reads:

“After assessing the potential applicability of consumer protections in the mortgage and credit card markets to student loans, recommendations for statutory or regulatory changes in this area, including, where appropriate, strong servicing standards, flexible repayment opportunities for all student loan borrowers, and changes to bankruptcy laws.”

For more details on the Student Aid Bill of Rights itself, please visit this website.

To learn more about how this updated Bill of Rights may affect your tax situation please contact our office at 858-549-8600 to let Attorney Gary Quackenbush and his staff discuss your particular situation with you. Gary has been helping people like you since 1989 and is sure to get you the best tax and debt relief possible. Call today for your free consultation!