Durbin, Cohen and Others Introduce Legislation to Restore Fairness in Student ...
Before the changes were made to the bankruptcy code in 2005, only the government has issued or guaranteed loans have been protected during the bankruptcy. This protection has been established since 1978 and was intended to protect the federal investment in higher education. The bill today is to restore the bankruptcy law, such as respect for private student loans, the language that was in place before 2005, while private student loans issued will be released again in bankruptcy."Students, especially those for-profit schools, which are unable to obtain government assistance to pay their high fees are turning to private loans to bridge the gap," said Durbin has introduced such legislation in June 2007. "Unlike federal student loans, there are some consumer protections for these private student loans, leaving some students stuck with this debt for the rest of their lives.The bill now will be to restore some equity in student loans by allowing borrowers in financial difficulties for private student loans to discharge these loans in bankruptcy, like other types private debt can be discharged. "
"People who seek higher education to better their future should not be dissuaded from doing so by the threat of financial ruin," said Cohen. "The bankruptcy system should function as a safety net that allows people to get the education they want with the assurance that if their finances strained by layoffs, accidents or other unforeseen life events, they will be protected.My bill is a small but important part in achieving this goal. "Congressman Cohen held a hearing on the dischargeability of student loans in bankruptcy in September 2009. It's been a long time to make higher education more affordable and accessible, including through the creation of the Tennessee Lottery.
For the past decade, private student loans were the fastest growing and most profitable part of the student loan industry. The interest rate and fees on private loans can be as expensive as credit cards.There are reports of private loans with interest rates of at least 15% and higher rates are not unknown. It can be a huge burden on student borrowers with private loans and student loans, unlike the federal government, there is no loan limit imposed by government on private loans and no government regulation on the conditions and cost of these loans.
About a quarter of a mile down the road is the local intersection, with the identikit Taco Bells, 7-Elevens, dollar stores and payday loan outlets that