In last week’s article about student loans, I mentioned how difficult they are to get rid of.  Primarily, they don’t just go away if an individual declares bankruptcy—he/she must demonstrate “undue hardship” such as a chronic illness or debilitating injury.

Later in the week, the US Supreme Court heard a case that has the potential to begin unraveling this rather tenacious knot of student debt. If the Supreme Court upholds the appeals court’s decision, loan holders may begin to have some flexibility in how they are able to discharge their student debt through bankruptcy.

According to today’s MinnPost article on student debt, the average Minnesota student graduates with $25,558, $3,358 higher than the national average. Moreover, 72 percent of students in Minnesota graduate with some debt. With students taking on increasing amounts in loans to fund their higher education, the outcome of this case could have a significant impact on the future of higher education finance in Minnesota.

The Court isn’t likely to rule on the case for several months, but the possibility of change is on the horizon.

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