If you are one of the many Americans struggling to pay off student loans, you may know how frustrating it can be to find a solution. Very few resources are available to borrowers, because student loans are not treated the same way other unsecured debts are. You can negotiate with your credit card company or medical provider, or you can discharge the debt in bankruptcy. Not so with student loans.

The Illinois House of Representatives passed a resolution earlier this month that may give you hope. The resolution is not binding, and it will not go to the Senate or the governor. What it does is formally express the House’s opinion that Congress should change bankruptcy and consumer protection laws to include student loans.

The resolution offers more than just the recommendation. It lays out the House’s arguments supporting the resolution.

Current law, of course, specifically excludes student loans from the debts that can be forgiven through bankruptcy. According to the resolution, it is the only type of debt to be excluded, and the rationale is unclear: Before the exclusion was adopted, just 1 percent of federally guaranteed student loans were discharged in bankruptcy.

Apparently the House is not the only organization to question the law. The resolution states that the Consumer Bankers Association and the American Bankers Association have spoken out against exempting student loans and only student loans.

The House points out as well that the federal government has exempted student loan debt from other consumer protection laws. We’ll explain more in our next post.


Chicago Sun-Times, “House calls for student loans to be forgiven in bankruptcy,” Elise Dismer, April 9, 2014

Illinois House of Representatives, House Resolution 620, as adopted April 9, 2014