Fresh Start Through Bankruptcy Act named Senate Bill S 2598
It’s official: S2598. This is the Senate Bill designation for the very cumbersome Fostering Responsible Education Starts with Helping Students Through Accountability, Relief, and Taxpayer Protection Through Bankruptcy Act of 2021.
Also, it spells out the (somewhat?) shorter Fresh Start through Bankruptcy Act of 2021.
In other words, as a new development, we now have an even shorter name for it: Senate bill 2598 or, shorter, S 2598.
What is S2598?
Senate bill 2598 is the bill introduced last week into the U.S. Senate which would provide much-needed student loan bankruptcy reform. So, what does this mean? There’s a long list of things that don’t go away in bankruptcy. Not surprisingly, student loans are on that list.
If this law passes, this would be student loan reform. However, it would be in bankruptcy. Consequently, it would change that list of exceptions in the Bankruptcy Code. In other words, it would amend 11 USC 523 and allow student loan forgiveness in bankruptcy.
First, it has to pass. If signed into law, this will present a major change in how student loans are handled in bankruptcy. At present, bankruptcy won’t discharge student loan debt unless it meets a very strict test of undue hardship.
Consequently, if the new S2598 Fresh Start Act passes through Congress and is signed into law, student loan forgiveness is broadened to those who qualify and get a bankruptcy discharge.
Interested? Then, click the Fresh Start Through Bankruptcy Act tag on the right to follow the progress and news of this landmark bill. Also, be sure to read our deep(er) dive below to get a better understanding of the subject.
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