A Potential Game-Changer in Student Loan Relief for Struggling Borrowers
For decades, student loans have remained one of the most difficult debts to discharge in bankruptcy. While credit card bills, medical debt, and even some tax debts may be wiped out, student loans require a separate legal process under the “undue hardship” standard—a notoriously high bar to meet.
That might soon change.
On July 5, 2023, Congress introduced H.R. 4444, titled the "Student Loan Bankruptcy Relief Act of 2023." This bill aims to amend the U.S. Bankruptcy Code and make it easier for borrowers to discharge certain federal student loans without having to prove undue hardship. Here's what you need to know.
What Is H.R. 4444?
H.R. 4444 is a bill introduced in the House of Representatives that proposes a major shift in how student loans are treated in bankruptcy cases. Currently, under 11 U.S.C. § 523(a)(8), most student loans are presumed non-dischargeable, unless the debtor initiates an adversary proceeding and proves that repaying the loans would cause “undue hardship.”
H.R. 4444 would eliminate the undue hardship requirement for federal student loans that have been in repayment for at least 10 years. In other words, it would allow certain federal loans to be discharged like credit cards or medical bills—without requiring a separate lawsuit or a nearly impossible legal standard.
Key Features of the Bill
10-Year Lookback Period: If a borrower has been in repayment for at least 10 years, their federal student loans would be eligible for discharge under a standard Chapter 7 or Chapter 13 filing.
Applies to Federal Loans Only: The bill currently covers only federal student loans, not private loans. However, it marks a significant shift in policy.
No “Undue Hardship” Requirement: Eliminating the undue hardship requirement would remove the need for an adversary proceeding, simplifying and lowering the cost of bankruptcy for qualifying borrowers.
How This Could Impact Bankruptcy Filers
If H.R. 4444 becomes law, it could fundamentally reshape bankruptcy relief for millions of Americans:
More Access to Relief: Borrowers who are drowning in student loan debt may finally get meaningful relief without spending thousands of dollars on litigation.
Shorter Timelines: Currently, bankruptcy discharge of student loans can take months or even years, especially when litigation is involved. This bill would drastically reduce that timeline.
Lower Legal Costs: Removing the adversary proceeding requirement means fewer legal hurdles and less expense, especially for low-income filers.
What You Should Do Now
H.R. 4444 has been introduced, but it is not yet law. Until it is passed and signed by the President, student loans remain dischargeable only under the undue hardship standard. However, if you’re considering bankruptcy and struggling with student loans:
Track the Bill’s Progress: Stay informed. You can monitor the status of H.R. 4444 at congress.gov.
Schedule a Bankruptcy Consultation: An experienced bankruptcy attorney can assess whether your current student loan situation might qualify for discharge under existing hardship standards—and help you plan for future relief if laws change.
Explore Other Options: In some cases, income-driven repayment, deferment, or loan forgiveness programs may be more suitable depending on your situation.
Final Thoughts
H.R. 4444 represents a long-overdue shift in how student loan debt is treated in bankruptcy. While the bill still needs to pass both the House and the Senate, it signals growing bipartisan recognition that the current system is unsustainable. If passed, it could open the door to real relief for millions of borrowers who have spent a decade or more trying to dig themselves out of student loan debt.
If you're considering bankruptcy or want to understand how this bill might affect you, contact Bankruptcy Near Me today.
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