State AGs Urge Department of Education to Get a Move On Forgiving Corinthian College Student Loans

Yesterday, nineteen state attorneys general and the Director of the Hawaii Office of Consumer Protection delivered a letter to Betsy DeVos, U.S. Education Secretary, urging the Department of Education to quickly process fraud claims brought by former students of Corinthian Colleges. The state AGs asked DeVos to approve “swift automatic group discharge” to students in … Read more

Discharging Student Loans in Bankruptcy: A Field Guide For People Who Have Nothing To Lose

Student loans cannot be discharged in bankruptcy. How often have you heard that said? But that bromide is not true. Student loans are being discharged–or at least partly discharged–in the bankruptcy courts every year. So if you are a distressed student borrower who will never pay back your student loans, why not attempt to discharge … Read more

Court Agrees Some Private Student Loan Debt Not Protected in Bankruptcy

Who holds the record for accumulating the most debt while going to college and law school? I don’t know, but it might be Scott Dufrane. Mr. Dufrane attended Thomas Jefferson Law School and graduated from the Maurice A. Deane School of Law at Hofstra University in 2009. He financed his undergraduate and legal education with … Read more

The White House Wants to Kill the Public Service Loan Forgiveness Program: But Who Can Stop a Tidal Wave?

President Trump’s White House proposes to eliminate the Public Service Loan Forgiveness Program (PSLF), which has triggered howls of protest. Jordan Weissmann, writing for Slate, described the proposal as a “sick joke” perpetuated by an out-of-touch President and an out-of-touch Secretary of Education: A billionaire president and billionaire education secretary, neither of whom spent a … Read more

Betsy DeVos’s Department of Education fumbles the Public Service Loan Forgiveness Program

The Public Service Loan Forgiveness Program: The Best Option for Student borrowers With Six-Figure Debt A few years ago, law professor Paul Campos wrote an advice book for people thinking about going to law school. If you borrow a lot of money to go to a second- or third-tier law school and graduate in the … Read more

Income-Driven Repayment Plans for Managing Crushing Levels of Student-Loan Debt: Financial Suicide

By the end of his first term in office, President Obama knew the federal student loan program was out of control. Default rates were up and millions of student borrowers had put their loans into forbearance or deferment because they were unable to make their monthly payments. Then in 2013, early in Obama’s second term, … Read more

Student Loan Debtors Need Good Bankruptcy Lawyers

We often hear that student loans cannot be discharged in bankruptcy—don’t even try. But in fact, quite a few people have gotten relief from their student loans in the bankruptcy courts. And a few student-loan debtors have gone to bankruptcy court without lawyers and been successful. But if you go to bankruptcy court to shed … Read more

The Student Loan Crisis is WORSE than the 2008 Housing Crisis: The Return of “The Big Short”

As everyone knows, the housing market collapsed in 2008, triggering a major economic crisis in the United States. The nation descended into recession, and the national economy is still recovering from this catastrophe. Steve Rhode and others have described a student loan “bubble,” and I share these commentators’ view that the federal student loan program … Read more

Student Loan Bankruptcy Case Discharges Debt for Humanity

Student loans cannot be discharged in bankruptcy, right? WRONG! Distressed student borrowers have won a string of victories in the bankruptcy courts over the past few years. And Fern v. FedLoan Servicing is another case for the win column. Fern v. FedLoan Servicing: A single mother of three children discharges her student loans in bankruptcy … Read more

Chased for Student Loan Debt for 37 Years

In Clusterfuck Nation, James Howard Kunstler has argued that many sectors of our economy have descended into criminal enterprises: banking, medicine and higher education in particular. And by God, he has convinced me. Kunstler concluded his latest essay with these words: “It is getting to the point where we have to ask ourselves if we … Read more

Bank of America hit with $45 million punitive damages award for violating automatic stay provision of Bankruptcy Code: ECMC take notice!

A few days ago, Judge Christopher Klein, a California bankruptcy judge, struck a breathtaking blow for justice when he assessed $45 million in punitive damages against Bank of America for violating the automatic-stay provision of the Bankruptcy Code. You may recall that a Texas bankruptcy judge hit Educational Credit Management Corporation with a $74,000 punitive … Read more

Bankruptcy May Be the Only Good Option for Overburdened Private Student Loan Debtors

Patsy Cline gave one of the greatest lyrical apologies in music history when she sang, “I’m sorry, so sorry that I was such a fool.” And of course about half of all country music songs are sung by some guy who says he’s sorry for cheating on his girlfriend. But for my money, the all- … Read more

Should Student Loan Debt Be Forgiven When Colleges Close?

As reported by Bloomberg, 763 colleges and schools closed last year–the highest number since 2012, when more than 900 schools were closed. In fact, since 1984, more than 13,000 post-secondary schools have shut down, including more than 300 foreign schools. And all these institutions–including the foreign institutions–were beneficiaries of the federal student aid program at … Read more

Single Mom Eliminates Private Student Loans in Bankruptcy But Federal Hold Back

Edwards v. Navient Solutions, Inc., decided last November, contains both good news and bad news for distressed student loan debtors. The good news is this: Paula Maxine Edwards, a single mother of two children, was able to discharge $56,640 in private student loans under the Bankruptcy Code’s “undue hardship” standard. Judge Janice Miller Karlin, a … Read more

Has Higher Education Become a Criminal Enterprise?

I am not a doomsayer or a survivalist, and I try to stay away from apocalyptic bloggers. But James Howard Kunstler, whose blog site goes by the unfortunate name of Clusterfuck Nation, is making persuasive arguments that our postmodern economy, hopped up on cheap energy and enormous debt levels, is unsustainable. In fact, he predicts … Read more