Senator Richard Durbin (D-IL) reintroduced legislation in Congress to allow privately-issued student loans to be discharged in bankruptcy.

This could negatively impact both the number of active private student loan lenders and the performance of student loan ABS. “The ability to discharge private student loans in bankruptcy would disrupt the private student loan market and could force lenders to raise borrower rates or elevate already strict underwriting standards, limiting access and valuable funding opportunities for students,” said the Education Finance Council in a press release today.

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