Jeff Hakanson, a renowned bankruptcy attorney and founder of Hakanson Law, applauds the recent changes in the Biden administration's bankruptcy guidance, announced in November 2022, making it easier for individuals to have their student loan debt discharged through bankruptcy. This breakthrough significantly relieves many borrowers struggling under the weight of their student loans.
For a detailed account of this development, read the full article on Business Insider here.
The new guidance is expected to significantly impact millions of Americans with student loan debt. According to Hakanson, this policy shift is a critical step forward in addressing the student debt crisis and offers hope to many who have been suffering for years under the weight of their loans.
Previously, borrowers were required to prove "undue hardship" to have their student loans discharged in bankruptcy. However, the term was ambiguously defined, making it difficult for borrowers to meet this standard. As a result, only a tiny percentage of people who filed for bankruptcy successfully discharged their student loans.
Under the new Biden administration guidance, the standard for proving undue hardship has been relaxed, allowing more borrowers to become eligible for student loan debt cancellation through bankruptcy. Hakanson believes this change is long overdue and is optimistic about the possibilities it brings for his clients and countless others.
Jeff Hakanson explains that the new guidance encourages bankruptcy judges to consider the borrower's income, job prospects, and other financial obligations when determining whether the loan repayment would impose an undue hardship. This broader and more flexible approach will make it easier for borrowers to discharge their loans and move forward with their lives.
While Hakanson acknowledges that bankruptcy should not be the first solution for those struggling with student loan debt, he emphasizes that this new guidance offers a valuable lifeline to those in desperate situations. He urges borrowers to consider their options carefully and consult a qualified attorney to determine the best action for their circumstances.
Hakanson Law is committed to helping individuals navigate the complexities of bankruptcy and is excited about the potential for this new guidance to relieve those overwhelmed by student loan debt. As an advocate for borrowers' rights, Jeff Hakanson will continue to monitor these policy changes and provide expert legal counsel to those seeking a fresh start.