[Congressional Record (Bound Edition), Volume 161 (2015), Part 1]
[Extensions of Remarks]
[Page 80]
[From the U.S. Government Publishing Office, www.gpo.gov]




STOPPING ABUSIVE STUDENT LOAN COLLECTION PRACTICES IN BANKRUPTCY ACT OF 
                                  2015

                                  _____
                                 

                         HON. JOHN CONYERS, JR.

                              of michigan

                    in the house of representatives

                        Tuesday, January 6, 2015

  Mr. CONYERS. Mr. Speaker, the ``Stopping Abusive Student Loan 
Collection Practices in Bankruptcy Act of 2015'' targets ruthless 
collection tactics employed by some student loan creditors against 
debtors who have sought bankruptcy relief, as documented by the New 
York Times in its cover story last year.
  Specifically, my legislation bill would empower a bankruptcy judge to 
award costs and reasonable attorney's fees to a debtor who successfully 
obtained the discharge of his or her liability for a student loan debt 
based on undue hardship if: (1) the creditor's position was not 
substantially justified, and (2) there are no special circumstances 
that would make such award unjust. The Bankruptcy Code already grants 
identical authority to a bankruptcy judge to award costs and reasonable 
attorney's fees to debtor where a creditor requests the determination 
of dischargeability of a consumer debt based on the allegation that it 
was fraudulently incurred and the court thereafter finds that the 
creditor's position was not substantially justified and there are no 
special circumstances that would make such award unjust.
  Although parties typically do and should pay their own attorney's 
fees in litigation, dischargeability determinations concerning student 
loan debts present compelling factors that warrant the relief provided 
by this legislation. Under current bankruptcy law, debtors must meet a 
very high burden of proof, namely, that repayment of the student loan 
debt will present an undue hardship on the debtor and the debtor's 
dependents. The litigation typically requires extensive discovery, 
trial-like procedures, and legal analysis.
  Unfortunately, some student loan debt collectors engage in abusive 
litigation tactics that exponentially drive up the potential cost of 
legal representation for a debtor. As a result, debtors, who may 
legally qualify for the Bankruptcy Code's undue hardship 
dischargeability exception for student loans, may be unable to obtain 
such relief because of the potential risk of excessive and unaffordable 
legal fees that the debtor may have to incur not only to meet the high 
standard of proof, but also to combat an abusive litigation stance 
taken by a well-funded adversary.
  The ``Stopping Abusive Student Loan Collection Practices in 
Bankruptcy Act of 2015'' will help level the playing field for debtors 
overwhelmed by student loan debts, the repayment of which would present 
an undue hardship for themselves and their families. It is my hope that 
should this measure become law, bankruptcy judges will not hesitate to 
award debtors attorney's fees in appropriate cases of abusive 
litigation engaged in by student loan creditors.

                          ____________________