Wednesday, December 07, 2005

Student Loan Debt

Student loan debt...a topic I'm very familiar with after ten years of higher education. One that brings a tear (or a dozen) to my eyes each month as I wrote those checks. I'm not usually one for consumer law issues, but this article in today's NY Times caught my eye. Student loans are already non-dischargable (for the most part) under the bankruptcy laws, and now the Supreme Court has held that Social Security funds can be dipped into to repay defaulted student loans more than ten years old.

This ruling was caused by a split in lower courts regarding whether or not there was a ten year limit on tapping SS funds for defaulted loans. Under a 1996 law, as related in the Times story, only a certain about of SS funds are totally exempt (as all the funds once were). The top court held that the ten year period did not apply and collection could proceed.


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