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Natalie Kitroeff – Obama Administration Hits Back at Student Debtors Seeking Relief

On a day when Democratic presidential candidates sparred in a national debate over who would do more to help indebted students, the U.S. government launched a new attack on student debtors seeking loan relief.

On Tuesday, the Department of Education intervened in the case of Robert Murphy, an unemployed 65-year-old who has waged a three-year legal battle to erase his student loans in bankruptcy.

Unlike almost every single form of consumer debt, student loans can be erased only in very rare circumstances. Murphy’s case, which is currently being heard in a federal court in Boston, could make things a little easier for certain borrowers. A win for Murphy would relieve him of $246,500 in debt and could loosen the standard used to determine how desperate someone needs to be to qualify for relief.

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