Clint Cutler of Bankruptcy Law Clinic Comments on KSTP of the Changes in Bankruptcy Guidance, Effect on Student Loan Forgiveness 

Last November, the United States Department of Justice (DOJ) issued new guidance that makes it easier for students to offload their student loans in bankruptcy if they meet the following criteria: 

  • Prove they lack the ability to repay the loan.
  • The inability to repay will likely persist in the future.
  • Acted in good faith to repay the loan.

Clint Cutler, a partner at Fredrickson and Byron, said it was a “sea change” moment for desperate students. “Now the government is willing to consider these factors in a way that’s a little more informal and quite a bit less expensive,” he said, adding that bankruptcy may now be a last resort for students at a crucial time.  

KSTP: For decades, filing for bankruptcy rarely helped with student loans. That’s changing.