Practice area focuses on bankruptcy, injury, family law

The Medical Bankruptcy Fairness Act of 2021 proposed legislation addresses Medical Bankruptcy and Student Loan Assistance

The Medical Bankruptcy Fairness Act of 2021 proposes to ease the impact of medical bills due to unforeseen medical circumstances and for Public Heath related shutdowns (ie: the Covid-19 pandemic). The legislation is asking to waive the pre-filing credit counseling requirement. Many view this requirement as unnecessary, not beneficial and find it as just another hurdle to getting relief, especially because these types of debts were incurred through no fault of the debtor and would thus provide no benefit.

There are also proposed changes to the homestead exemption, allowing debtors to protect up to $250,000 in equity in their homes, allowing more people to qualify for chapter 7 bankruptcy.

Finally, they are seeking to allow for discharge of student loans in bankruptcy as well, which is currently very difficult to do under the current bankruptcy caselaw. While it is possible, student loan discharge is rarely granted.

I feel these first two provisions make sense, and have a good intent. Congress has been talking about changing the student loan dischargeability laws, but should propose this as separate legislation to be discussed, and studied for its impact. But legislation always has extra provisions weaved into the proposals, so this is nothing new. I would support some modifications of the student loan dischargeability laws, but I am not in favor of a straight elimination of student debt.

The legislation can be reviewed here: The Medical Bankruptcy Fairness Act of 2021

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Terrance Leeders

Chicago Bankruptcy Attorney, husband, father, Cubs fan.

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