U.S. Sen. Elizabeth Warren (D-MA) is encouraging the U.S. Department of Justice (DOJ) to issue and implement updated student debt bankruptcy guidance with no delay.
Warren has forwarded correspondence to Attorney General Merrick Garland regarding the request, following the Biden-Harris administration’s decision to cancel up to $20,000 in student debt for up to 43 million borrowers and overhaul the student loan system.
“The administration’s bold action to provide debt relief and reform the student loan system for current and future borrowers underscores the urgent need for the Department of Justice (DOJ) to do its part to ensure that borrowers who continue to struggle with student debt have a path toward additional relief,” Warren wrote.
Warren is advocating the DOJ prioritize updating the student bankruptcy guidance and provide clear answers regarding the status of its plans to address bankruptcy discharge claims no later than Sept. 15, 2022, with Warren maintaining borrowers have struggled to receive relief because of the failures of the existing bankruptcy guidance and consequent actions by DOJ and the Department of Education (ED).
“Those who do pursue undue hardship claims face aggressive litigation challenges by the federal government that fail to acknowledge borrowers’ challenges in navigating the student loan system,” Warren concluded. To support the administration’s efforts to overhaul the student loan system and ensure that bankruptcy relief is a viable option for borrowers in severe financial straits, it is critical that you issue and implement this updated guidance without delay.”