Discharging Student Loans Through Bankruptcy

This is a very readable summary of the Brunner Test for discharging student loans in bankruptcy. I would only note that another complication is that the debtor must initiate an adversary proceeding to discharge student loan debt.

Find Your Balance

488960049Student debt is weighing on you like a baby grand piano on your back. You honestly have no idea how you can make payments. You’re considering throwing up your hands and declaring bankruptcy to rid yourself of the unworkable debt. But not so fast. There are a few things you need to know before you go down this path.

Who can have loans discharged?
In order to have your student loans discharged, you must show that paying them would cause an “undue hardship” for you and/or your dependents. Generally speaking, in practice this is a very tough standard to reach.

How is hardship determined?
Each court can determine what standard they use to determine undue hardship. A common measurement is known as the Brunner test. Under this test, you are allowed to discharge your student loans only if:

  • You cannot maintain a minimum standard of living for yourself or your…

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