More student-loan borrowers are getting debt cancellation through bankruptcy 2 years after Biden streamlined the process

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By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time by visiting our Preferences page or by clicking "unsubscribe" at the bottom of the email. Access your favorite topics in a personalized feed while you're on the go. download the app Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview The Biden administration's new process to help student-loan borrowers get rid of their debt in court is working. On Wednesday, the Justice Department released an update on bankruptcy for borrowers following new guidance it released in 2022. According to the department, 588 new cases were filed from October 2023 to March 2024, marking a 36% increase from the prior 6-month period. Most of those borrowers have also seen success in court — per the department, 98% of them received full or partial debt relief from November 2022 through March 2024. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Prior to the guidance, borrowers had to prove an "undue hardship" standard, in which they had to show that they could not maintain a minimal standard of living, that their circumstances weren't likely to improve, and that they had made a good-faith effort to repay their debt. However, that standard was very challenging for borrowers to meet, so the Education and Justice Departments streamlined the process by establishing clearer guidelines for borrowers to prove undue hardship. Those included examining whether borrowers have made a good faith effort to repay their debt and determining their future ability to make payments. Advertisement The guidance also allowed borrowers to complete a self-attestation form, which allowed departments to process their discharge requests faster and avoid investigations. "Our clear, fair, and practical standards are helping struggling borrowers find relief that was previously out of reach," Under Secretary of Education James Kvaal said in a statement. "This data should puncture the myth that struggling borrowers cannot discharge their student loan debt through bankruptcy," he continued. "We will continue to work with our partners at the Department of Justice to make it simpler and easier for borrowers to get much-needed relief in the way it was intended." Along with an increase in borrowers filing for discharges, the departments also found that 96% of borrowers voluntarily completed self-attestation forms, and some bankruptcy courts have taken on procedures to use the new process. Advertisement The Justice Department did not immediately respond to Business Insider's request for the total number of borrowers who have received discharges through this process. While this process shows improvement, it has been slow-moving. The advocacy group Student Defense found that fewer than 45 borrowers had received full or partial discharges just under a year after the new guidance. Related stories Some Democratic lawmakers have also scrutinized the process. Last summer, Sen. Elizabeth Warren requested information on how the guidance was being implemented, writing that the bankruptcy standard "has been narrowly interpreted by courts, and has proven to be so difficult to meet that most borrowers do not even attempt to discharge their student loans through the bankruptcy process." Still, Biden's administration is using the new data to show the process is working and expects more borrowers to participate. Advertisement "The results are clear: this guidance has helped make the promise of a fresh start in bankruptcy a meaningful option for individuals weighed down by student loan debt," Acting Associate Attorney General Benjamin Mizer said in a statement. Have you gotten your student loans discharged through bankruptcy? Are you struggling with the process? Share your story with this reporter at asheffey@businessinsider.com.