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Reed Law Blog  ~ Dean A. Reed


In 2014 student loan debt averaged $33,000.00. In some cases student loan debt comprises 69% of all debt owed by graduates. This makes the class of 2014 the most indebted ever. This debt affects the ability to purchase a home and car. This adversely affects the economy as millennials represent the largest portion of our population.

At one time debt relief was available for graduates saddled with student loans. Before 1976 all education loans were dischargeable in bankruptcy. In 1976 the debt relief for student loans was restricted when the law was changed so that government loans and loans from non-profits could not be discharged in the first 5 years of repayment. Then in 1984 debt relief from student loan was denied to private student loans.

In 2005 a sweeping overhaul of the bankruptcy law further denied debt relief from all student loans unless the borrower can show “undue hardship”, a difficult burden to prove.

It doesn’t have to be that way. If you borrowed money for college or plan to do so or are the parent of one such person you should act now to have debt relief from student loan made available in bankruptcy. Write your congressperson. They hold the key to writing legislation that reinstates debt relief from student loans in the bankruptcy laws.

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