[repomies69]

Ah that's why they're complaining about the student loans.

In The European countries I have been living in, the concept of personal bankcrupty doesn't exist in the same way, at least. People who get too much loans kind of just hang with them, after 15-20 years they are forgiven AFAIK.

[eru]

Btw, my suggestion for the US would be to remove that special bankruptcy exception for new student loans.

That's because once you do that, the supply of new student loans would most likely dry up. Thus shutting off the money fountain for the education industry.

[rayiner]

Your suggestion wouldn’t work because nearly all student loans (over 90%) are issued by the federal government, which does not (and for political reasons, never will) evaluate credit risk.

[trashtester]

Just make the college a guarantor for the student loan. That would solve a lot of the issues with higher ed in the US today....

[eleveriven]

Actually it sounds really good

[greenavocado]

Germany has Verbraucherinsolvenzverfahren. The individual's credit rating will be negatively affected for several years after the completion of the procedure. The insolvency proceedings are recorded in a public register, which can be accessed by anyone. The process typically lasts for six years, during which the individual must adhere to a strict budget and make payments to creditors. After completing the six-year period, the remaining debts are discharged, provided the individual has adhered to the terms of the insolvency plan.

Step 1 is außergerichtliches Schuldenbereinigungsverfahren where the debtor attempts to reach an out-of-court settlement with creditors. This stage usually lasts up to 6 months.

Then there is Eröffnung des Insolvenzverfahrens where if the out-of-court settlement fails, the debtor files for insolvency with the local court. The court appoints a trustee to manage the debtor's assets and liaise with creditors. This stage typically takes 1-2 months.

Next there is either Regelinsolvenzverfahren or vereinfachtes Insolvenzverfahren. In the latter if the debtor's assets are insufficient to cover the costs of the proceedings, the court may initiate a simplified insolvency process. The debtor proposes an insolvency plan to the creditors, which includes a 6-year repayment period. If the plan is accepted, the court approves it, and the debtor begins making payments.

In the former, if the debtor's assets are sufficient to cover the costs, regular insolvency proceedings take place. The trustee liquidates the debtor's assets and distributes the proceeds among creditors. The debtor proposes an insolvency plan, which typically includes a 6-year repayment period.

After the insolvency plan is approved, the debtor enters a 6-year good conduct phase called Wohlverhaltensperiode. During this period, the debtor must adhere to the repayment plan, maintain gainful employment, and inform the trustee of any changes in their financial situation. The debtor is allowed to keep a portion of their income for living expenses.

If the debtor complies with the terms of the insolvency plan during the good conduct phase, the court grants a discharge of the remaining debts called Restschuldbefreiung. This typically occurs 6 years after the opening of insolvency proceedings.

This is really not that different from bankruptcies in America. I think Europeans are simply unaware of their options.

In the US Chapter 7 bankruptcy will remain on the individual's credit report for up to 10 years, making it difficult to obtain credit, secure housing, or find employment. Chapter 7 bankruptcy is a matter of public record, which can be accessed by anyone. The process is relatively quick, typically lasting 4-6 months. Most unsecured debts, such as credit card balances and medical bills, are discharged upon completion of the process.

Chapter 13 bankruptcy will remain on the individual's credit report for up to 7 years, which is less than Chapter 7. Like Chapter 7, Chapter 13 bankruptcy is a matter of public record. The repayment plan typically lasts for 3-5 years, during which the individual must make regular payments to creditors. After completing the repayment plan, the remaining eligible debts are discharged.

Verbraucherinsolvenzverfahren lasts longer (6 years) than both Chapter 7 (4-6 months) and Chapter 13 (3-5 years). Verbraucherinsolvenzverfahren and Chapter 13 involve a repayment plan, while Chapter 7 does not. Chapter 7 has a longer-lasting impact on credit ratings (10 years) compared to Verbraucherinsolvenzverfahren and Chapter 13 (6-7 years).

France has a procedure called "rétablissement personnel," which is similar to Chapter 7 in the US, allowing individuals to liquidate their assets and discharge their debts. In the UK, individuals can file for bankruptcy or enter into an Individual Voluntary Arrangement (IVA), which is similar to Chapter 13 in the US.