Bankruptcy and Student Loans

"As overall student loan indebtedness in the United States has increased over the years, many borrowers have found themselves unable to repay their student loans. Ordinarily, declaring bankruptcy is a means by which a debtor may discharge—that is, obtain relief from—debts he is unable to repay. However, Congress, based upon its determination that allowing debtors to freely discharge student loans in bankruptcy could threaten the student loan program, has limited the circumstances in which a debtor may discharge a student loan. Under current law, a debtor may not discharge a student loan unless repaying the student loan would impose an “undue hardship” upon the debtor and his dependents.

The Bankruptcy Code does not define “undue hardship,” and the legislative history of the relevant statutory provision does not precisely specify how courts should determine whether a debtor qualifies for an undue hardship discharge. The task of interpreting this statutory term has consequently fallen to the federal judiciary. Courts, however, have disagreed regarding exactly what a debtor must prove in order to discharge a student loan on undue hardship grounds..."
Bankruptcy and students loans

The Effect of Firm Bankruptcy on Retiree Benefits, with Applications to the Automotive and Coal Industries

"Benefits for retired employees are of particular interest to policy makers because of the growing

number of retirees and forecasts indicating that some future retirees may not have the necessary financial resources to maintain their standards of living. Part of this congressional concern is what happens when bankrupt employers are unable to provide promised pension and health benefits to their retired employees.."

Bankrupcty and retiree benefits