Allen Ertel, a Congressman from Pennsylvania, pushed to make student loans hard to discharge. Ertel was in the U.S. House of Representatives from 1977 to 1983. Despite stats showing less than 1% of federal student loans were ever wiped clean in bankruptcy, Ertel argued student loan defaults were jumping up. His convincing talk changed the rules, making student loans stick around after bankruptcy unless the borrower faced severe hardship.
Joe Biden’s Dual Role in the Student Loan Crisis
Joe Biden has affected the dynamics of student loan debt and its dischargeability, playing two distinct roles:
As a senator, Biden backed multiple pieces of legislation that unintentionally exacerbated the student loan crisis. These laws facilitated the growth of student loan borrowing, often increasing borrowers’ monthly payments and making these loans tougher to discharge in bankruptcy.
As President, Biden’s policy changes have further altered the landscape of student loan dischargeability, albeit in a different direction. While his administration has sought to alleviate the student loan crisis and lighten the burden on borrowers, the reforms implemented may have indirectly made it more difficult for some student loan borrowers to discharge federal loans in bankruptcy.
Here’s how:
The administration created the most affordable repayment plan to date, shielding even more of a borrower’s discretionary income from student loan payments. While this new student loan repayment plan provides immediate relief, it might inadvertently discourage some borrowers from seeking bankruptcy discharges.
Biden implemented an interest waiver, effectively reducing the debt burden. While beneficial for most, it could indirectly create an environment where discharging student loans through bankruptcy becomes harder.
All federal student loan borrowers, including those with a consolidation loan, are eligible to get retroactive credit toward income-based repayment forgiveness. This move alone has already erased $39 billion in federal student loans. Experts expect that this will ultimately lead to a $400+ billion bailout by the federal government, again potentially reducing the instances of borrowers resorting to bankruptcy.
As a senator, Biden backed multiple pieces of legislation that unintentionally exacerbated the student loan crisis. These laws facilitated the growth of student loan borrowing, often increasing borrowers’ monthly payments and making these loans tougher to discharge in bankruptcy.
Yes literally what I said. Cherrypicking lmao. If you want to learn something:
“Biden was one of the most powerful people who could have said no, who could have changed this. Instead he used his leadership role to limit the ability of other Democrats who had concerns and who wanted the bill softened,” said Melissa Jacoby, a law professor at the University of North Carolina at Chapel Hill specialising in bankruptcy
Oh, I’m afraid you misunderstood. I was doing you the respect of including what you were talking about along with the context for it, because you aren’t wrong that Biden contributed to the problem. But you are very wrong that he’s exacerbating it now.
But hey, the difference between then and now, true and false, right and wrong - why should any of that bother you? You’ve got an agenda to push! 🤡
Cherry picking a bit, there.
https://www.tateesq.com/learn/student-loan-bankruptcy-law-history
Yes literally what I said. Cherrypicking lmao. If you want to learn something:
How Biden helped create the student debt problem he now promises to fix:
(please stop using this formatting btw)
Oh, I’m afraid you misunderstood. I was doing you the respect of including what you were talking about along with the context for it, because you aren’t wrong that Biden contributed to the problem. But you are very wrong that he’s exacerbating it now.
But hey, the difference between then and now, true and false, right and wrong - why should any of that bother you? You’ve got an agenda to push! 🤡