In advance of 1976 – Student loans might possibly be discharged like many un-secured debts and you can credit and you will repayment was subject to normal sector pushes like any most other debt.
It’s skewed brand new student loan markets heavily and only loan providers, causing disastrously negative consequences to have student loan individuals:
1976 – Government Regulations 
kept one student loans could not feel discharged unless of course that they had been in cost for five many years prior to the processing of one’s bankruptcy proceeding; if the student loans ended up being when you look at the installment for less than five years, they may only be discharged whether or not it is an “excessive adversity” to the debtor to repay the mortgage. In the 1978, the brand new Bankruptcy proceeding Password are amended to keep the exact same limitation.
1979 – The 5-year installment several months needs was extended from the people deferments and you can forbearances that had been drawn from the borrower. So it restrict to the dischargeability was longer past finance created by a great bodies device in order to fund covered, guaranteed otherwise financed by the an authorities device.
1981 – The latest 8th circuit (with Minnesota) situated an examination for excessive difficulty considering the “totality away from situations” to determine dischargeability. ادامهٔ «A short And you will Sad Reputation for Student loan DISCHARGEABILITY»