How 2020 Student Loan Rulings Set New Precedents

How 2020 Student Loan Rulings Set New Precedents

( -The level of student loan debt peaked in 2019. The average student loan that year surpassed $30K for the first time in a decade. Additionally, almost a fourth of students with an academic loan had overdue payments. However, recent rulings by three New York bankruptcy courts set new legal precedents opening the door for remedies unavailable to loan recipients in the past.

The National Consumer Law Center, a non-profit focusing on low-income issues, told reporters those decisions might very well have changed everything.

In the first case, a New York bankruptcy judge set aside about $200K of student loan debt for a person. The second case upheld the discharge of nearly $500K of federal loans for an individual. The third case eliminated roughly $200K in college debt for a couple with nearly a dozen educational loans at private learning institutions.

Typically bankruptcy hearings can be quite complex and expensive, costing thousands of dollars in filing fees, court costs, and attorney fees. So, it remains to be seen if this becomes a viable option for student loan recipients in the future. However, these 2020 cases offer a glimmer of hope to individuals delinquent on their student loans.

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