student loan

It’s a ‘severe problem’ that student-loan borrowers are still facing roadblocks getting rid of their debt through bankruptcy, Elizabeth Warren says
Sen. Elizabeth Warren

Sen. Elizabeth Warren.Tom Williams/CQ-Roll Call, Inc via Getty Images

  • Elizabeth Warren called on the Justice Department to restore bankruptcy protections for student-loan borrowers.

  • Borrowers currently have to prove a difficult standard in court to get rid of their debt.

  • Biden’s administration has promised reform, but the process continues to be slow-moving.

Massachusetts Sen. Elizabeth Warren is renewing the call to restore bankruptcy protections for student-loan borrowers.

Last week, President Joe Biden took a major step in providing relief to millions of borrowers by announcing up to $20,000 in student-loan forgiveness for those making under $125,000 a year. While that relief is expected to wipe out balances for 20 million borrowers, the majority will still have debt balances that some might seek to discharge in court through bankruptcy. But doing so has historically been very difficult, and Warren wants Attorney General Merrick Garland to ensure bankruptcy becomes a viable route to providing relief.

“To support the administration’s efforts to overhaul the student loan system and ensure that bankruptcy relief is a viable option for borrowers in severe financial straits, it is critical that you issue and implement this updated guidance without delay,” Warren wrote in a Thursday letter

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September 12, 2022 by ATTORNEY

Warren Grills DOJ on Why It’s Still Trying to Crush Student Debtors in Bankruptcy Court

Just over a week after President Joe Biden unveiled a plan to cancel $10,000 in federal student loan debt for most borrowers and reform the income-driven repayment program, his administration on Thursday was rebuked once again for its ongoing effort to deny bankruptcy relief to some of the nation’s most hard-pressed student debtors.

“Those who continue to struggle with student debt are in need of updated undue hardship guidance.”

In a letter sent to Attorney General Merrick Garland, Sen. Elizabeth Warren (D-Mass.) asked about the status of the Department of Justice’s “work to update guidance on how it handles undue hardship claims by student borrowers in bankruptcy proceedings.”

“To support the administration’s efforts to overhaul the student loan system and ensure that bankruptcy relief is a viable option for borrowers in severe financial straits,” Warren wrote, “it is critical that you issue and implement this updated guidance without delay.”

Although Biden spent years as a senator siding with lenders and making it more difficult for Americans to reduce educational loan repayment obligations in court, he promised last year to “allow for student debt to be relieved in bankruptcy,” which would help give overwhelmed borrowers a fresh financial start.

Nevertheless,

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September 11, 2022 by ATTORNEY

Student-Loan Borrower Chooses Between Paying Debt and Health Insurance

  • Robin O’Brien, 61, has $64,000 in student debt from her master’s degree.
  • She’s experiencing long COVID, which has caused her to work part time earning half an income.
  • Now, she’s forced to choose between affording health insurance or paying off her student debt.

Even on an income-driven repayment plan for her $64,000 student-debt load, Robin O’Brien can’t afford the payments.

After working in long-term care facilities for 25 years, O’Brien said the next step in her career was becoming an administrator — but in order to be in that field while making a sufficient income, she needed a master’s degree. When she took out federal loans to take online classes at two public universities, and after graduating in 2017, there was no way she could have foreseen the pandemic and the financial strain it would bring.

Now, she’s dealing with long-COVID symptoms that forced her to work part time, and her medical bills and student-debt bills are unmanageable.

“Right now, I’m picking five of the envelopes with medical bills, and then I’ll pay them $20 apiece,” O’Brien said, referring to the stack of bills she gets each month. “And the next month I’ll take five

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June 13, 2022 by INSURANCE
May 2024
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