WASHINGTON, D.C. – Today, U.S. Senator Jacky Rosen (D-NV), a member of the Senate Committee on Health, Education, Labor, and Pensions (HELP), announced her co-sponsorship of the Student Borrower Bankruptcy Relief Act, legislation that would allow student loans to be dischargeable during bankruptcy.
“Students in Nevada and across the country are being saddled with the burden of rising debt, with even those with full time jobs finding themselves unable to pay their student loans, even after bankruptcy,” said Senator Rosen. “Congress must take action to protect our nation’s students so that they aren’t dragged down by student loan debt. I will continue to work on forward thinking solutions to our nation’s student loan debt crisis.”
BACKGROUND: Currently, while nearly all other forms of consumer debt are dischargeable in bankruptcy, student loans can only be discharged if the borrower proves “undue hardship” in court.
Last Congress, then-Congresswoman Rosen co-sponsored similar legislation, the Discharge Student Loans in Bankruptcy Act of 2017.
This is a tough, many faceted problem. I agree that the loans should fall into the same category as personal loans in a bankruptcy and we should act to protect our students. However, that old word, we should also protect the student from themselves. If a 20 or 21-year-old student went to a bank and asked for a loan of, say, $125,000, based on an expectation of future earnings, laughter would rock the room. Yet that is exactly what is happening. A wise drug counselor told me that drugs are rampant among the young because they see themselves as immortal. Drugs cannot hurt me and I will make a million dollars a year out of college. We must add some level of wisdom to ensuring student loans. Maybe only match what a student has saved and can add to the total available school funds. We must change the game.