New Bill Proposed As Relief For Students Loan

 
This is the first time it’s been the bipartisan consensus of choosing between student loan forgiveness and bankruptcy reform.
Last week a new bill called “FRESH START Through Bankruptcy Act of 2021” was proposed by Senate Majority Whip Dick Durbin (D-IL), and Senator John Cornyn (R-TX)
This bill enables borrowers to opt for student loan discharge in bankruptcy. With this bill student, borrowers get a chance to get back on their feet.
If the bill gets approved, then it allows federal student loans to become eligible for discharge in bankruptcy proceedings 10 years after the borrower’s first loan payment comes due.
The associate professor of law at the University of Utah and an expert on student loan bankruptcy law, Jason Iuliano, said that the bill’s 10-year waiting time was noteworthy.
He supports this idea because he feels the people who have been struggling to repay their student loans for a decade can benefit from bankruptcy’s fresh start and get some respite in their life.
And it would see to it that the student loan credit market continues to be operational.
If student loans are discharged in bankruptcy or if the colleges or universities had high default rates and small repayment rates continuously then the bill proposes to make colleges that receive federal loans from more than a third of their students to be accountable for partial reimbursement to the Department of Education (ED).
Iuliano said that this proposal will stop underperforming schools that have ever-increasing tuition fees, to cut it or improve employment prospects for their students.
Close to 45 million Americans have more than $1.7 trillion debt in federally-backed student loans.
Student loan bankruptcy discharge
Though it is difficult, discharging student loans through bankruptcy, is not impossible.
The student loans were just like other unsecured debt bankruptcy before 1976. Congress observed that student borrowers were declaring bankruptcy right after graduation. That is when laws became harder.
Sen. Josh Hawley (R-MO) feels that the bipartisan bill was a very sensible approach because of students with huge debts as lifelong serfs of banks and lifelong serfs of universities by not letting them discharge a bankruptcy of their debt under appropriate circumstances.
Reference Source: Yahoo Finance
https://www.compareclosing.com/mortgagenews/new-bill-proposed-as-relief-for-students-loan/

Comments

Public Feedback Requested By CFPB

The Home Mortgage Disclosure Act underwent certain changes and to evaluate whether it is meeting the stated goals of detecting discrimination in mortgage lending the Consumer Financial Protection Bureau is seeking comments. The CFPB requests for assessment of the mortgage disclosure law and checks if it meets the objectives of the Dodd-Frank Act . To abolish discrimination in mortgage lending in 1975 the Congress enacted . The bureau said the request comes after an August report found that mortgage lenders as compared to white applicants were charging higher interest rates and denying credit to Black and Hispanic applicants. The bureau said that with this evaluation the CFPB will be able to maintain a fair, competitive, and non-discriminatory mortgage market. They added that the assessment is an opportunity for the Bureau to get an idea if the earlier HMDA rulemakings have improved upon the data collected, thereby reducing loans on financial institutions, and streamlining and mo

What is an Appraisal Contingency? — Best Guide for Homebuyers

About Appraisal Contingency If a home is appraised for less than the purchase price included in the contract then there is a provision that is included in the purchase contract allowing homebuyers to back out of their contract this is termed as an appraisal contingency clause. Buyers who use financing to buy a house or are buying homes in areas where prices are volatile commonly use Appraisal contingencies. How do Appraisal Contingencies work? Purchase offers have appraisal contingencies inserted into them to notify the seller that the buyer intends to have the property appraised as part of their purchase for the financing process. If th e property doesn’t appraise for the amount the buyer offered to pay then this contingency allows them the option of backing out of the contract without losing their earnest money deposit or facing other penalties. During an appraisal, a licensed professional is hired by the homebuyer to examine the property and evaluate it against the recent sal

What is Fannie Mae and Freddie Mac?

Understanding Fannie Mae And Freddie Mac What is Fannie Mae and Freddie Mac? Fannie Mae or FNMA is a nickname for Federal National Mortgage Association. It was established in 1938. It is a Government-sponsored Enterprise (GSE). In 1968, Fannie Mae ceased to exist as a government entity and became quasi-governmental, federally charted corporation to buy mortgages other than those insured by the Federal Housing Administration, otherwise known as FHA. Freddie Mac or FHLMC is a nickname for Federal Home Loan Mortgage Corporation. Freddie Mac is also a government-sponsored enterprise (GSE) which was brought into existence in the year 1970 by the Congress. It provides competition to Fannie Mae and provides funds availability in the secondary mortgage market. What is Fannie Mae's and Freddie Mac's Role? Fannie Mae’s purpose is to create a secondary market for the purchase and sale of mortgages. The secondary mortgage market is where home loans and s

How to Use Home Equity for Remodeling Projects

Important Guide How to Use Home Equity Everyone has to live somewhere and, everyone has to invest their money in someplace. So what happens when where you live, meets up with where your money is invested? Today we are going to discuss on how to use home equity for remodeling projects and things to know before using it for remodeling. For most homeowners, it is a choice between paying cash or borrowing against the equity that they have build up in their home. HELOC Or HEL? Interest rates are still significantly low, and we are not sure how long they are going to stay that way. And home values are still rising at least on average. So taking out a home equity line of credit (HELOC) or a Home equity loan (HEL) may seem like a sensible financial move. Not always the case We have explained the difference between the HELOC and HEL in our blog post “ About Home Equity Loan / Home Equity Line Of Credit .” It depends on the individual’s needs to choose between t

COMPARE CLOSING LLC

Search This Blog