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  1. Signatures
    916 out of 10,000,000
    Petitioning
    1. The U.S. Senate (+ 7 others)
      Petitioning
      close
      • The U.S. Senate
      • The U.S. House of Representatives
      • Sen. Barbara Boxer (CA)
      • Sen. Dianne Feinstein (CA)
      • Sen. Tom Harkin (IA)
      • Sen. Richard Durbin (IL)
      • Sen. Sheldon Whitehouse (RI)
      • Sen. Al Franken (MN)
  2. Created By
    Ray Gallo
    San Rafael, CA
About this Petition Petition Letter Petition Updates

In this day and age of stunningly-profitable for-profit schools using hard-sell tactics to sell middle and low-income students education and training of doubtful value at high prices, it is time to revisit the discharge-ability of student loans in bankruptcy.  

We gave relief to GM and Chrysler. We gave it to AIG.  We give relief to people who consume luxury goods they cannot pay for.  We should give at least a little relief to ordinary people who sought a better life through education or training but were either misled or simply miscalculated, and wound up with student loan debts they cannot hope to pay.   These  people should pay what they can pay over time, but they should be entitled to discharge the rest in bankruptcy.  Otherwise, their lifetime of insolvency and misery will hurt us all.

There has been a bill pending in Congress to fix this since last year.  It's time it was acted on.

 

 

Why People Are Signing
Recent Signatures

Student loan debt should be dischargeable under Chapter 13 of the Bankruptcy Code

Senator,

Student loans should be dischargeable under Chapter 13 of the bankruptcy code.

Under the law today, student loan debt cannot be discharged in bankruptcy. This rule originally applied only to federally guaranteed loans, and was to protect taxpayers. Banks later lobbied Congress and had it expanded to cover private student loans.

It's a good policy to make people responsible for paying their debts. But evidence is mounting that for-profit schools, opportunistic banks, and other profiteers have taken advantage of the education finance system. Many students are sold education or training at prices unrelated to the value they receive, and they are sold the financing to pay for it at high interest rates. In the end, those students are left with debts they can never hope to pay.

Students should be responsible for their own actions. But so should schools who sell education or training that is worth less than what it costs. And so should banks that loan money to facilitate those deals while turning a blind eye to what they know or should know—that the student is being damaged by buying what the school sells.

Students should be required to repay their student loans if they can. But to the extent they cannot pay, even over many years to come, those debts should be discharged. That is how Chapter 13 of the bankruptcy code works. Individuals can discharge debts they cannot reasonably hope to pay. That way, they have some hope of leading productive lives, having families, and contributing to society.

Otherwise, they will retire still insolvent, never get ahead, and their misery and lack of financial wherewithal will hurt all of us and society---particularly given their growing numbers.

We have no debtors prisons in the US, but citizens with student loan debt are now being singled out for their particular misfortunes. Individuals who buy houses and cars they cannot afford get relief. Individuals who buy education that doesn't pencil out do not.

We gave relief to GM and Chrysler. We gave it to AIG. We should give just a little to ordinary people who sought a better life through education or training but were either misled or simply miscalculated. These people should pay what they can pay over time, but they should be entitled to discharge the rest in bankruptcy.

Student loans should be dischargeable in bankruptcy.

[Your name]

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