KEY POINTS
  • More people with federal student loans have been able to walk away from their debt in bankruptcy court due to a Biden administration policy change announced last November.
  • In the first 10 months of the new policy, student loan borrowers filed more than 630 bankruptcy cases, a "significant increase" from recent years, the government said.
President Joe Biden delivers remarks about the student loan forgiveness program on Oct. 17, 2022.

More people with federal student loans have been able to walk away from their debt in bankruptcy court due to a Biden administration policy change announced last November.

In the fall of 2022, the U.S. Department of Education and the U.S. Department of Justice released updated bankruptcy guidelines to make it easier for struggling borrowers to get their student loans erased in court. Previously, it was difficult, if not impossible, for people to part with their education debt in a normal bankruptcy proceeding.