Should student loans be dischargeable in bankruptcy court?

F

Fr3shjive

Member
Joined
Feb 13, 2009
Messages
430
As you know student debt has been in the news a lot lately because of all the OWS protests. While I certainly don't think that you're entitled to a free education I also don't think that you should be saddled with debt for the rest of your life because of poor choices you made in your teen and early 20s. Every other form of debt can be discharged in bankruptcy court except for student debt, why shouldn't that be included?

What do you think RPFs: should student debt be eligible to be discharged in BK court?
 
Last edited:
thats a toughy!

on one hand i think a person should pay any and all debts they owe just because its being responsible. however hardships do occur and there should be a way to get help in some form or another, maybe charity based.

on the other hand, wall street got bailed out on massive waste and fraud type debt so if its good enough for them, then student loans based on that should be up for bankruptcy court.
 
Fr3shjive said:
As you know student debt has been in the news a lot lately because of all the OWS protests. While certainly dont think that you're entitled to a free education I also dont think that you shoud be saddled with debt for the rest of your life because of poor choices you made in your teen and early 20s. Every other form of debt can be discharged in bankruptcy court except for student debt, why shouldn't that be included?

What do you think RPFs, do you think student debt should be eligible to be discharged in BK court?
Click to expand...

They could have done what my two oldest children did - Join the military and EARN their education!
 
Of course they should be dischargeable. The whole idea of filing for bankruptcy protection is to get a fresh start. There are so many exceptions to discharge today that the fresh start is moribund. In 2005 the bankruptcy laws underwent major changes making it harder for everyone to file. It could be argued that the unavailability of bankruptcy relief is one of the reasons we are so choked on debt today. Even Ron Paul says we must liquidate debt. Well that is what bankruptcy does. It liquidates debt. With the stroke of a gavel, debt just disappears. I have heard it speculated that the changes in the laws in 2005 precipitated the housing crash. Of course that bubble would have popped eventually anyway, but when people could not discharge their credit card debts in a bankruptcy, they fell behind in their mortgages trying to keep up the credit card payments.
 
student loans should be the same as any other debt, same for IRS and state/local govt debt
 
Fr3shjive said:
As you know student debt has been in the news a lot lately because of all the OWS protests. While certainly dont think that you're entitled to a free education I also dont think that you shoud be saddled with debt for the rest of your life because of poor choices you made in your teen and early 20s. Every other form of debt can be discharged in bankruptcy court except for student debt, why shouldn't that be included?

What do you think RPFs, do you think student debt should be eligible to be discharged in BK court?
Click to expand...

That rates should be increase 2-4% because they are way to low. Make the folks pay way more. They are totally screwing everyone over in the US.

For example, the NH government already paid the least into the NH government colleges this year. However, this year, NH cut government spending in government colleges by at least 45% this year, more than twice as much as any other state. Of course, the government shouldn't pay a penny in your college education. Oh, and I recommend you don't waste your time going to college, either.
 
Bailouts are always a 100% wrong. The vast majority of folks (somewhere around 80%) in the US are Christian. Of course, it goes against Christianity to not pay 100% of your debt off. But of course, government should completely get out of the student loan biz ASAP.
 
Keith and stuff said:
Bailouts are always a 100% wrong. The vast majority of folks (somewhere around 80%) in the US are Christian. Of course, it goes against Christianity to not pay 100% of your debt off. But of course, government should completely get out of the student loan biz ASAP.
Click to expand...

lol, you are not a Christian are you?
 
Keith and stuff said:
Bailouts are always a 100% wrong. The vast majority of folks (somewhere around 80%) in the US are Christian. Of course, it goes against Christianity to not pay 100% of your debt off. But of course, government should completely get out of the student loan biz ASAP.
Click to expand...

Who owns the debt? Just wondering.
 
specsaregood said:
Who owns the debt? Just wondering.
Click to expand...

Bingo! Since Uncle Sam provided me with that unsecured loan, he will happily allow me to put that obscure degree I have to good use in one of his military branches in order to settle that debt! My not being able to get the job I want, where I want to live, is not the same as my not being able to find a job at all.

As Thompson said: Buy the ticket, take the ride.
 
Yes.

Bankruptcy is an integral part to the free market. People forget this.

Lenders need to know that there's a risk they won't be repaid. Then, they will be more cautious with who they lend to.

Then you won't have a bunch of 22 year olds with $100k in debt and a sociology degree--because they never would've gotten lent the money in the first place.
 
It should definitely be possible for borrowers to discharge student loans through bankruptcy, just as with any other form of debt.

One of many problems that the current system has is that it removes the need for lenders to adequately qualify borrowers -- which was, of course, the whole idea in the first place. This encouraged more people to borrow. The idea was that "all education is good," and that somehow just because people had a degree, they would be able to quickly pay back their debt, no matter what type of degree or how much debt; it's economic nonsense.

By allowing student loans to be discharged through bankruptcy, and by not providing government guarantees, lenders would be forced to look at traditional borrower qualifications, which would be a Good Thing all around.
 
Blueskies said:
Yes.

Bankruptcy is an integral part to the free market. People forget this.

Lenders need to know that there's a risk they won't be repaid. Then, they will be more cautious with who they lend to.

Then you won't have a bunch of 22 year olds with $100k in debt and a sociology degree--because they never would've gotten lent the money in the first place.
Click to expand...

A++ post, would read again.

The FedGov backing every jackass that wanted to go to school at 'the best possible school' (read: most expensive) for a shitty liberal arts degree in historical art, womans literature, etc, definitely helped to create this problem. When a lending company can make loans with 100% of its capital and all of it will be insured by some outside party - of course they are going to be extremely reckless with their lending.
 
You must log in or register to reply here.

Similar threads

Anti Federalist
VP - "Student loans will be forgiven regardless of income, even if you didn't graduate"
Replies
16
Views
1K
Voluntarist
Voluntarist
Anti Federalist
Over 153,000 people got emails today, notifying them that their student loans are "forgiven"
Replies
9
Views
1K
Matt4Liberty
M
Swordsmyth
Why Property Tax Is Illegal
Replies
12
Views
4K
Snowball
Snowball
Swordsmyth
Trump Tells Xi, Putin 'Let's Cut Military Budget In Half' - Says Russia Should Be Back In G7
Replies
5
Views
201
unknown
unknown
PAF
Vance’s Big Win Which Wasn’t All That
Replies
0
Views
802
PAF
PAF
Back
Top