Stopping Abusive Student Loan Collection Practices in Bankruptcy Act of 2026
Sponsored By: Representative Thanedar, Shri [D-MI-13]
Introduced
Summary
Creates a clearer path for borrowers to get student loans discharged in bankruptcy. This bill would let debtors ask a court to decide whether their student loan debt meets the legal "undue hardship" test by using the procedural route in 11 U.S.C. § 523(d). It aims to limit abusive or overly aggressive student loan collection tactics during bankruptcy proceedings.
Show full summary
- Families and borrowers: Makes it easier for people in bankruptcy to seek discharge of student loans by allowing a debtor-initiated undue hardship determination. This could give struggling borrowers a clearer legal route to relief.
- Loan holders and collectors: Narrows some collection leverage in bankruptcy by shifting the procedural path for dischargeability claims. Creditors may face more debtor-initiated challenges to student loan claims.
- Courts and cases: Changes the procedural basis courts use to resolve student loan discharge claims and applies only to bankruptcy cases commenced under Title 11 on or after enactment.
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Bill Overview
Analyzed Economic Effects
1 provisions identified: 1 benefits, 0 costs, 0 mixed.
More bankruptcy relief for student borrowers
If enacted, you would be able to ask a bankruptcy court to decide that repaying your student loan would be an undue hardship. The bill would amend the bankruptcy code to let a debtor start that undue-hardship discharge process under § 523(a)(8). It would apply only to Title 11 bankruptcy cases started on or after the date of enactment. Courts would decide each case, and some filers could get large student debt relief depending on their situation.
Sponsors & CoSponsors
Sponsor
Thanedar, Shri [D-MI-13]
MI • D
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov