Here’s what you need to know—and what it means for your student loans.
A student loan borrower, Thelma McCoy, petitioned the Court to have nearly $350,000 of student loans discharged after the 5th U.S. Circuit Court of Appeals ruled that her student loans could not be discharged in bankruptcy. The Court denied McCoy’s petition for certiorari. McCoy borrowed $175,000 of student loans to earn a college degree, master’s degree and Ph.D. While earning her Ph.D., McCoy sustained injuries and said she could not find employment due to her disabilities. McCoy argued that paying student loans created an undue financial hardship. Unable to pay her student loans, McCoy filed for Chapter 7 bankruptcy in federal court in Texas to discharge her student loans, which had grown with interest to $350,000. However, McCoy did not get student loan cancellation. Why?