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[quote=Anonymous]This is getting a fair amount of press the past couple of days:

http://moneyland.time.com/2012/02/09/why-cant-you-discharge-student-loans-in-bankruptcy/

[quote]If you’re struggling to pay credit card debt, car loans or even gambling debt, you can wipe the slate clean in bankruptcy. Struggling to pay your student loans? Sorry, you’ll just have to figure that one out on your own.

In an effort to shed light on a policy they say “doesn’t make any sense,” a group of bankruptcy lawyers issued a report on Tuesday that highlights the need to change the U.S. bankruptcy code so that it offers college grads relief from inescapable debt loads. 
...

Some fear allowing graduates to discharge their private loans would create a situation where students take out many loans during college and then turn around and file for bankruptcy when they get their diploma. But those who make that argument forget that bankruptcy is not for the faint at heart; it’s a lengthy, complicated legal process and there are also anti-abuse protections in place to guard against those who would opt for bankruptcy when they can in fact afford to pay their debts.

On the contrary, Kantrowitz says allowing private loans to be discharged could have some very positive effects. Lenders might be more careful about whom they lend to and how much. And when they have distressed borrowers, they might be more willing to compromise, he says. Which would mean for the first time in a long time, private lenders would have a little incentive to play nice with students.

Read more: http://moneyland.time.com/2012/02/09/why-cant-you-discharge-student-loans-in-bankruptcy/#ixzz1m1O0Kccr

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[quote]Thought the mortgage crisis was a rough ride? Buckle up for the next financial crisis.

Student-loan debt may be the next major U.S.-asset bubble to burst, according to Standard & Poor's.

The problem: colleges and universities are hamstrung with lower endowments, while students have increasingly lower prospects of ever paying back their loans. Student debt now outpaces credit-card debt, approaching $1 trillion for the first time. The Project on Student Debt found that in 2008, 67 percent of college students at four-year universities were graduating with student-loan debt. That number is even higher for students at private nonprofit and for-profit colleges and universities.

http://www.huffingtonpost.com/2012/02/09/sp-warns-student-loans-bubble-burst_n_1266209.html[/quote]

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