Justice Department Updates Important Student Loan Discharge Form
Whether you have been considering bankruptcy for some time and are inquiring about if it may be possible to have your student loan debt discharged, or you have been following news about new guidance and wondering about the possibility of having your student loan debt discharged, you are not alone. As the student debt crisis continues to loom large, many debtors in Florida and across the country are asking questions about bankruptcy and student loan debt. Those inquiries have become more visible since the U.S. Department of Justice (DOJ) and the Biden Administration provided information about new guidance for handling student loan debt in consumer bankruptcy cases.
According to a recent article in Forbes, the DOJ has now updated an attestation form that is key to the new process for handling consumer bankruptcy cases involving student loans. That update should let debtors know that it is time to begin speaking with a bankruptcy lawyer in West Palm Beach about their student loan debt and their bankruptcy case. In the meantime, our attorneys can tell you more about the update and what you should know about the attestation form.
New Guidance for Student Loan Discharged in Bankruptcy
The Forbes article comes after news of new guidance from the Biden administration for discharging student loans in consumer bankruptcy cases. It is important to know that the underlying requirements for a discharge have not changed. In other words, the “undue hardship” requirement still exists. What this means is that a debtor seeking to have student loans discharged in a bankruptcy proceeding would need to experience an undue hardship if they were required to continue to pay student loans (an undue hardship if the loans are not discharged).
While that underlying undue hardship requirement remains unchanged, the process is now different with the new guidance. A key element of the new process is the attestation form, which is the recently updated form discussed in the Forbes article.
What is an Attestation for Student Loan Debt Discharge in Bankruptcy?
The attestation form is a 15-page form, according to Forbes, through which the debtor provides detailed information about their financial circumstances that can show and clarify that they have met the “undue hardship” requirement. The attestation form has now been updated so that debtors can provide essential information that includes, for example: details about their student loan debt and payments, monthly income and expenses, assets, and attempts in the past to repay student loan debt.
Contact a West Palm Beach Bankruptcy Lawyer
The article in Forbes underscores that, in all likelihood, the Justice Department is planning for many more debtors to be eligible to have their student loans discharged in bankruptcy filings. Given that the new guidance makes the process for a bankruptcy discharge significantly easier — even if it does not change the undue hardship requirement — more debtors should be thinking about the possibility of discharging student loan debt in bankruptcy. If you have questions or want to learn more about your options, one of the experienced West Palm Beach bankruptcy lawyers at Kelley Kaplan & Eller can speak with you today.