White House Weighs Decision To Enable Discharge Of Student Loan Debt Through Bankruptcy
Created: Friday, 20 July 2012 09:40
That would include only about 15% of current outstanding debt issued by Sallie Mae and Wells Fargo & Co. The 2005 law prohibiting student loan inclusion in bankruptcy filings currently only allows the discharging of such debt in extraordinary circumstances.
Private lenders warn that the move could cause interest rates to spike as a result of increased loan losses. Many students do not have assets like houses from which to recover the losses. For those who have made a good-faith effort to repay the debt, Sallie Mae supports reform that would allow the discharge through bankruptcy.
The student debt issue is one that filters into the economy, hampering young people from becoming productive business owners and wage earners because of the enormity of their debt
loads and the length of time it takes to pay the debt off since students are just starting out and have few resources.
This Website Is For Financial Professionals Only