Robert Shireman, President of The Institute for College Access and Success, is guest blogging over at New America Foundation—check out his post today on how private student loans (not the government-backed loans) can’t be eliminated in bankruptcy.
Bankruptcy allows people who have serious financial problems a chance to start over by relieving them of most of their debt and preventing creditors from pursuing lawsuits and garnishing wages. But these protections do not extend to private student loan debt. Private student loan debt is in a special category of debt, along with child support, taxes, criminal fines, and government-backed student loans, that can't be eliminated with bankruptcy.
How did private student loans end up in that category? Well, apparently no one is quite sure. But one thing is sure -- preventing students from discharging private student loans eliminates a valuable safety valve for students with the most serious financial problems.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment