The NYT on Intermediaries and Student Loans

The New York Times ran an important story today by Natalie Kitroeff on the role of Educational Credit Management Corporation in policing student loans in bankruptcy. It is a story that should interest all Credit Slips readers.

Observers of the legal scene often underestimate the role that intermediaries play in shaping not only the court system but the legal doctrine itself. In the story, Ms. Kitroeff mentions a decision of the U.S. Court of Appeals for the Eighth Circuit that essentially adopted Educational Credit's loan repayment guidelines as the legal standard for what constitutes "undue hardship" for a discharge. One could ponder how the legal doctrine on undue hardship might look if Educational Credit was not pushing so hard in one direction.