It could become easier for student loan borrowers to file bankruptcy

Our videos are made by the latest news in the world.
Do you enjoy the video? Find it helpful? Want to view more?
Why not subscribe our channel to save you searching next time http://bit.ly/2FRmyPR ?
Thank you so much!Lawmakers have introduced a bill that would make it easier for student loan borrowers to cancel their debt in bankruptcy.The measure, which is supported by 14 Democrats, one Republican and one independent, is dubbed the Student Borrower Bankruptcy Relief Act of 2019. "Americans struggling financially should have the option to discharge their student loans during bankruptcy as a last resort," said John Katko, R-New York. "This bipartisan legislation makes that change."A number of consumer advocacy groups, including Americans for Financial Reform, the National Consumer Law Center and the Center for Responsible Lending, praised the bill. "It's important to have legislation that will provide vulnerable student loan borrowers who cannot repay their debt with a pathway to reestablish their financial stability," said Cheye-Ann Corona, a senior policy associate at the Center for Responsible Lending.The country's outstanding student loan balance is projected to swell to $2 trillion by 2022, far surpassing credit card or auto debt, and experts say a large portion of it is unlikely to ever be repaid. More than a quarter of borrowers are in delinquency or default. Student borrowers owed $33,310 on average in 2018, according to the latest figures available from the Institute for College Access & Success.In the 1970s, policy makers and pundits raised concerns that students would rack up a bunch of loans and then try to discharge them after graduation. As a result, lawmakers added a stipulation that student loan borrowers would have to wait at least five years after they began repayment to file for bankruptcy. In 1990, that waiting period was upped to seven years. Almost a decade later, the rules changed again, and now people with federal or private student loans can walk away from their debt in bankruptcy only if they can prove their loans pose an "undue hardship."