Discharging Student Loans in Bankruptcy Gets House Subcommittee Hearing

In 2005, Congress added private student loans to the list of debts that are not automatically discharged when a person declares bankruptcy — federally guaranteed student loans were treated that way in a 1976 law. Instead, students who borrow from both public and private lenders must prove to a judge that repaying their debts would be an “undue hardship.” On Wednesday, a subcommittee in the U.S. House of Representatives held a hearing on why the law should be changed.